Dollar Tree announces permanent price increase for the first time in 35 years

After 35 years of pricing almost everything at $1 or less, national retailer Dollar Tree announced Tuesday that it will soon permanently increase prices. According to the Associated Press, the price jump will begin to appear in select locations soon, before more than 2,000 stores see the increases next month.

The company said nearly all of the company’s 8,000 sites will see a price hike sometime early next year.

“(Dollar Tree) believes this is the right time to move away from the constraints of the $1 price point in order to continue to provide maximum value to customers,” the company said in a statement.

The company cited the higher cost of goods and the higher cost of operations (such as wages) as reasons for the increase, saying that persistent shortages in the supply chain were not a reason for the increase.

Dollar Tree executives don’t think customers will suffer a backlash against the chain as its prices have held steady for decades and are still considered affordable.

“[Customers]believe that at $1.25 it will still be an undeniable value because of what they see in the market,” Dollar Tree CEO Michael Wittinsky said on a call with industry analysts. “And they know the Dollar Tree hasn’t raised its price in 35 years, so they give us credit.”

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