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Dollar Tree struggles with rampant theft as it closes stores

  • Dollar Tree Inc. will close nearly 1,000 locations over the next few years
  • Some communities rely on discount stores like Family Dollar for groceries
  • The closures might impact so-called 'food deserts'

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(NewsNation) — Theft continues to plague Dollar Tree Inc. and its Family Dollar chain, a persistent issue that has only worsened amid plans to shutter hundreds of underperforming locations, the company said Wednesday.

During an earnings call, Dollar Tree executives revealed the discount retailer’s efforts to install more security cases and hire more guards have failed to curb the rampant shoplifting that has long vexed dollar stores.

Nearly 1,000 Family Dollar and Dollar Tree locations are set to close over the next several years, an announcement that stands to disproportionately impact communities where discount stores have pushed out local grocers.

Dollar Tree Inc. did not immediately respond to NewsNation’s request for comment on how the closures might impact so-called “food deserts,” where grocery options have dwindled due to competitive discount store pricing.

The number of independent grocers significantly declines when new dollar stores enter a neighborhood, according to research from the University of Toronto and the University of California, Los Angeles. The impact is equal to the loss of about one grocery store for every three dollar stores within a 2-mile radius.

When communities lose grocery stores in exchange for dollar stores, shoppers buy about 4 to 7% less fresh produce. The study suggests that that decline is significantly steeper for low-income households.

Dollar Tree began locking up more items and stationing workers near store entrances last year after reporting its financial performance was being battered by excessive “shrink,” retail jargon for theft and other inventory loss. But those measures proved insufficient.

Rampant theft isn’t limited to Dollar Tree. In Wisconsin, a group of Dollar General employees walked off the job to protest rising levels of shoplifting and lack of safety measures.

NewsNation’s Katie Smith contributed to this report.

Business

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