DOLLAR Tree is undergoing a major change at the executive level after facing a wave of economic hardships.
Following a series of store closures and a decline in profits, the discount chain has announced a shift in its leadership.
Dollar Tree is undergoing a major leadership change at the executive level[/caption]
Dollar Tree’s leadership shift comes amidst financial struggles and a wave of store closures[/caption]
Dollar Tree announced on Monday that chairman and CEO Rick Dreiling had stepped down from his position as of November 3.
Health complications factored into his decision.
“With my health presenting some new challenges over the past two months, the time is right for me to step away and focus on myself and my family,” said Dreiling.
“I have been honored to serve the customers and associates of Dollar Tree and Family Dollar since 2022.”
The former CEO will be temporarily replaced by Michael Creedon, the discount chain’s chief operating officer.
Creedon was appointed interim CEO as the board searches for a permanent CEO.
Dollar Tree’s New Interim CEO
Michael Creedon took on the role of interim CEO in place of the former Dollar Tree CEO Rick Dreiling.
Creedon served as the discount chain’s COO since joining the company in 2022.
Before joining Dollar Tree, the interim CEO held multiple leadership positions at Advance Auto Parts for nearly nine years.
Most recently, Creedon was executive VP and president of US Advance Auto Parts stores.
Source: Dollar Tree
“Having worked side-by-side with Mike, I am confident in his strong leadership, deep passion for our business and ability to create value,” said Dreiling.
The new CEO also spoke out about his hope for the future of Dollar Tree.
“The entire Dollar Tree team is grateful to have worked so closely with Rick. Looking forward, we are well-prepared to help both banners reach their fullest potential,” said Creedon.
“We are excited about our current trajectory and are focused on delivering a successful holiday season. We will continue accelerating growth at Dollar Tree, and we remain focused on identifying the best path forward for Family Dollar.”
SALES SLUMP
Dollar Tree Inc. operates over 16,000 stores under the Dollar Tree, Family Dollar, and Dollar Tree Canada banners.
The shift in executive leadership comes as the chain struggles to stay afloat amidst macroeconomic pressures, impacting all three banners.
On a previous company conference call, Creedon attributed Family Dollar’s struggles to the pressure its core lower-income customers were under.
The former chief operating officer added that high inflation and interest rates among other economic factors have increasingly impacted Dollar Tree’s middle-class and high-income consumers.
The struggles consumers are facing have impacted the discount chain’s sales, with Dollar Tree financially faltering in recent months.
The chain’s second quarter net sales, for example, were $7.37 billion – less than 1% higher than the same time in 2023.
The overall same-store sales growth of 0.7% was impacted by a decline of 0.1% at Family Dollar, contrasting with a stronger 1.3% increase in the Dollar Tree banner.
As Family Dollar struggles, the company is reassessing how to move forward with the banner.
Dollar Tree Inc. is considering selling it, spinning it off into a separate entity, or divesting the business.
The company announced earlier this year its plans to close around 1,000 stores to improve its profitability.
It laid out plans to shutter around 600 Family Dollar stores in the first half of fiscal 2024 and close 370 Family Dollar and 30 Dollar Tree stores as their leases expire.
The company has taken strides in the past to turn around its decline, including expanding its merchandise.
In March, Dollar Tree began offering products ranging from $1.25 to $7 – a change that resulted in a sales increase at the participating stores.
Other retailers are undergoing changes, including Costco enforcing purchase limits on a popular holiday item.
Kroger also confirmed it’s opening two “Asian focused” stores in the same state with new decor and food options.
