Dollar Twenty-Five Tree? 

While the beloved discount variety store chain will not be changing its name any time soon, Dollar Tree announced Tuesday that it will be changing the prices of most of its items from $1 to $1.25.

What You Need To Know

  • Dollar Tree announced Tuesday that it will be changing the prices of most of its items from $1 to $1.25

  • The company insisted that the decision was not a reaction to short-term inflation, but rather will allow the company to expand its offerings and introduce new products

  • In recent months, the company announced it would begin testing items for $1.25 and $1.50, as well as offering items for $3 and $5; Dollar Tree said it has seen positive responses to both changes

  • The company will begin expanding the new price point to 2,000 additional Dollar Tree stores in December, and expects to complete the rollout by early next year

The company said in a statement that the decision does not have to do with recent trends of rising inflation, which has driven up the price of consumer goods nationwide, but will allow the company to "materially expand its offerings, introduce new products and sizes, and provide families with more of their daily essentials."

"For 35 years, Dollar Tree has managed through inflationary periods to maintain the everything-for-one-dollar philosophy that distinguished Dollar Tree and made it one of the most successful retail concepts for three decades," the company wrote in a statement.

In recent months, the company announced it would begin testing items for $1.25 and $1.50, as well as offering items for $3 and $5. The company said in September that they saw a "positive customer reaction" to the $3 and $5 items, and said Tuesday that offering items for $1.25 and $1.50 produced "overwhelmingly positive" results.

"As detailed in its September announcement, the Company believes this is the appropriate time to shift away from the constraints of the $1.00 price point in order to continue offering extreme value to customers," Dollar Tree wrote in a statement. "This decision is permanent and is not a reaction to short-term or transitory market conditions."

"Our Dollar Tree pricing tests have demonstrated broad consumer acceptance of the new price point and excitement about the additional offerings and extreme value we will be able to provide." Dollar Tree president and CEO Michael Witynski wrote in a statement. "Accordingly, we have begun rolling out the $1.25 price point at all Dollar Tree stores nationwide."

The company will begin expanding the new price point to 2,000 additional Dollar Tree stores in December, and expects to complete the rollout by early next year.

Witynski said on a call with industry analysts, per The Associated Press, that he expects the store's customers to stay loyal, because they "believe that at $1.25, it’s still going to be an undeniable value because of what they’re seeing out in the marketplace, and they know that Dollar Tree hasn’t raised its price in 35 years, so they’re giving us credit."

Dollar Tree has about 8,000 stores nationwide.