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Family Dollar Plans Consumables Promotions

Family Dollar Stores said it hopes to drive increased traffic with more in-store and direct-marketing campaigns that focus on its increased assortments of consumables and private-brand merchandise.

MATTHEWS, N.C. — Family Dollar Stores here said Wednesday it hopes to drive increased traffic with more in-store and direct-marketing campaigns that focus on its increased assortments of consumables and private-brand merchandise.

"We're also increasing targeted digital marketing efforts and executing more promotional events to leverage our growing customer traffic," Howard R. Levine, chairman and chief executive officer, told analysts during a conference call to discuss financial results for the second quarter and first half, which ended Feb. 26. He was not specific about any of those plans.

According to Levine, consumables accounted for 62.2% of sales in the second quarter, compared with 60.8% a year ago. Having already expanded the assortment of grocery and health and beauty aids at 300 stores last year, Family Dollar intends to add more than 350 SKUs of grocery and personal care merchandise to another 500 stores this year, Levine said, "by leveraging slightly higher shelf heights and reducing space in some underperforming discretionary categories."

Private brand sales at Family Dollar rose 23% through the first half of the year, he noted, with private-brand consumables up 29%.

For the quarter, net income increased 9.8% to $123.2 million, whiles sales rose 8.3% to $2.3 billion. Comparable-store sales were up 5.1%. For the half, net income climbed 9.8% to $197.5 million, while sales were up 8.9% to $4.3 billion and comps rose 6%.