PITTSBURGH (KDKA) — Two of the nation’s three largest dollar discount stores are joining forces.
It’s an acquisition that could affect the wallets of many consumers.
Dollar Tree is acquiring Family Dollar in a friendly $8.5 billion purchase that positions it to overtake Dollar General, the nation’s leading dollar discount chain.
There are 5,000 Dollar Tree stores in the United States and 8,000 Family Dollar stores.
Dollar Tree would not say whether they would close any of these stores. In fact, for the time being, both companies will operate under their old names.
Locally, there are 58 Dollar Trees and 52 Family Dollars within 50 miles of Downtown Pittsburgh, but each has a discount niche.
While Family Dollar has flexible pricing, everything at Dollar Tree is a buck or under.
“They (Dollar Tree) really are where you’re buying little gift things or holiday or seasonal decorations, and they really are completely different than Family Dollar that is like a little mom and pop grocery store,” Point Park University professor Elaine Luther told KDKA money editor Jon Delano.
They’re other differences, too, noted Duquesne University professor Audrey Guskey.
“When you look at the Dollar Tree, they’re mainly in the suburban areas — not that it’s an upscale consumer but it could be — as compared to the Family Dollar which is more in rural and city types of areas,” said Guskey.
Customers don’t seem to care about any of this as long as the stores stay open.
“I personally don’t care,” said Olga Hodgetts of Carnegie. “I come here all the time, and I like it. But if it’s different name to me, it doesn’t matter.”
“Whatever is convenient to get to, that’s where I go,” added Irene Was of North Fayette.
The acquisition positions Dollar Tree and Family Dollar to compete against bigger chains.
“A lot of people are saying they’re going head to head with Dollar General, but they really might be going head to head with Walmart,” noted Luther.
And that battle may be good news for consumers.
“In this situation, it’s good for consumers because I think the prices are going to continue to stay low, and these two stores are going to have more buying power to allow shoppers to really save some money,” said Guskey.