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Shoppers Turn to Dollar Tree for Groceries as Inflation Costs Hit Hard

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Dollar Tree is known for its great prices on holiday decorations and party supplies, but as food prices continue to hit budgets hard, shoppers are turning to this discount store to get their groceries.

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According to Winsight, Dollar Tree’s same-store sales of consumables outpaced discretionary sales for the second straight quarter, the retailer reported, with a 9.3% comparable in food and beverage, snacks and cookies, and candy. 

Same-store sales of food and beverages grew by 4.7% and the chain saw overall same-store sales growth of 4.1%, Winsight noted. The company’s overall same-store sales increased by 8.6%.

“We are increasing our sales outlook for the year. The efforts to evolve the assortment to drive consumables performance at Dollar Tree, combined with initiatives designed to improve the value proposition at Family Dollar, are working,” said Mike Witynski, Dollar Tree President and Chief Executive Officer in a company statement. “We believe we will continue to be part of the solution to millions of households seeking value at a time when they need us most.”

Dollar Tree has made several investments in its food merchandising, said Winsight, and the chain has seen increasing interest in its private label items. Witynski also told analysts that SNAP and food stamp business is growing as shoppers are “shifting into the consumables and needs-based to make their budget happen,” Winsight reported.

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Dollar Tree plans to continue its focus on increasing frozen and refrigerated offerings, as well as over-the-counter drug and health items, paper products and food as it looks to expand its owned private-label brands.

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