Dollar Tree to buy out Family Dollar, now what?

(Photo Source: WMC Action News 5)
(Photo Source: WMC Action News 5)

(WMC) - Dollar Tree is buying out Family Dollar, creating the largest discount retailer in America. People who shop at both stores say they have significant differences, and some shoppers are concerned about what the acquisition will mean.

"Which one of them are going to stay open?" shopper Virginia Cathey asks.

Family Dollar fans can relax. The corporate office says Family Dollars will not be converted into Dollar Trees. The two stores will be owned by the same company, but they will function independently as complements to each other.

Shoppers were shocked because there are 71 Family Dollar stores in Memphis and only 14 Dollar Trees. Dollar Tree has about 5,000 stores across the country, and there are 8,000 Family Dollar stores nationwide.

Shoppers care because the two stores are slightly different. Family Dollar has name brands for low prices, and Dollar Tree has a lot of generic items at a fixed price.

"Dollar Tree means literally a dollar. Family Dollar, nothing in there costs a dollar. I can't even find pencils for a dollar," said Hopkins.

During a conference call on Monday, the Dollar Tree corporate office said with both retailers buying in bulk, they will be able to offer customers greater value. However, they never directly said prices could drop at their Family Dollar Stores.

"I like the bargains at both of the stores. In fact, I left that store to come to this store," said Cathey.

Dollar Tree expects the merger will result in $300 million in savings by year three. Customers hope those savings will hit their pocket books.

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