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The Washington Post reports that Dollar Tree, after three decades promising that “Everything’s $1,” now has “begun testing higher prices at some of its stores. Soon, more than 100 Dollar Tree stores around the country will sell items that cost up to $5.”

There are two reasons. First, there are activist inventors that have been pushing the company to test a higher ceiling on prices. And second, there are the Trump administration’s tariffs on China and Mexico, two countries from which Dollar Tree imports a lot of merchandise. (It gets 40 percent of its product mix from China.)

It isn’t just Dollar Tree. The chain’s main rival, Dollar General, also has said it is raising prices because of tariffs.
KC's View:
The activist investors pushing for a higher price ceiling are doing so because they want the company to compensate for the company’s $8.5 billion acquisition of the Family Dollar chain, which has not had the kind of impact that it hoped for; the company is bigger, but not better … which happens so often when acquisitions take place. But it remains to be seen whether going against what one would think of as a core company value is going to have the desired effect.

As for the tariffs … this seems to reinforce the argument that tariffs hurt US consumers more than foreign countries against which they are levied, and in this case, they seem to hurt people who can ill afford it.

Potential bad news all around.