1. The Dollar Tree Brad Dowdy Elizabeth Cha Ryan Lancaster

2. Mission Statement Dollar Tree Stores, Inc. is a customer- oriented, value driven variety store, operating at a one dollar price point. It will operate profitably, empower its associates to share in its opportunities, rewards and successes; and deal with others in an honest and considerate way. The company's mission will be consistent with controlled and profitable growth. Dollar Tree Stores, Inc. is a customer- oriented, value driven variety store, operating at a one dollar price point. It will operate profitably, empower its associates to share in its opportunities, rewards and successes; and deal with others in an honest and considerate way. The company's mission will be consistent with controlled and profitable growth.

3. Background Info. Established in 1953 and headquarters in Chesapeake, VA. Established in 1953 and headquarters in Chesapeake, VA. Acquired numerous companies Acquired numerous companies –4 similar companies from 1996- 2000 As of Dec. 31, 2005: As of Dec. 31, 2005: –#75 on top 100 businesses –Revenue: $3.3 billion (+8.6% from 2004) –# of stores: 2,914 –Stock price: $31.20 (DLTR/NYSE)

4. Who & Why? Low-Medium income households Low-Medium income households –Dollar Tree locations typically anchored next to mass merchandisers (ex: Walmart & Target) Convenience Convenience Variety of Merchandise Variety of Merchandise $1 price ceiling $1 price ceiling

5. Product Category Division 1 Division 1 –Party Goods, Stationery, Gifts, Crafts/Notions Division 2 Division 2 –Fashion Accessories, Softlines, Floral, Valentine/Easter, Halloween, Thanksgiving/Fall Seasonal, Christmas, Baby, Books, Toys Division 3 Division 3 –Candy, Food, Health/Beauty Care Division 4 Division 4 –Household Consumables, Housewares, Pet Supplies, Electronics, and Hardware

6. Types of stores The Dollar Tree chooses three different store locations. The Dollar Tree chooses three different store locations. –Large strip center or mall –Small strip center –Stand alone store

7. What Do We Look For? Regional centers, anchored by "big box" discounters or dominant grocery stores. Regional centers, anchored by "big box" discounters or dominant grocery stores. Freestanding locations in a strong retail corridor, with street presence and easy in/out and plenty of parking. Freestanding locations in a strong retail corridor, with street presence and easy in/out and plenty of parking. Shopping centers that are highly visible and have strong traffic counts. Shopping centers that are highly visible and have strong traffic counts. Back door freight delivery, accessible by tractor-trailers Back door freight delivery, accessible by tractor-trailers

8. Store Layout Anchored by large discount or grocery store (25-33%) Anchored by large discount or grocery store (25-33%) Inside a mall (18%) Inside a mall (18%) Freestanding or strip centers (about 50%) Freestanding or strip centers (about 50%) Dollar Tree employs Grid Layout in the Corvallis location Dollar Tree employs Grid Layout in the Corvallis location

9. Strengths Pricing of merchandise at $1.00 Pricing of merchandise at $1.00 Wide range of merchandise Wide range of merchandise Potential industry growth and square footage growth. Potential industry growth and square footage growth. Corvallis Corvallis –Located within a small strip center (other retailers to draw customers in) –Little direct competition

10. Weaknesses Customer Service Customer Service Quality and quantity Quality and quantity Poor product presentation Poor product presentation Lack of cleanliness  Lack of cleanliness  Corvallis Corvallis –Above! –Location in relation to campus –Strip mall retail selection (run down strip aesthetics) –Poor signage

11. Opportunities for the Dollar Tree Relatively slow growth in U.S market, but stores that focus on discount merchandise will generally gain market share from independent more higher priced retailers. Relatively slow growth in U.S market, but stores that focus on discount merchandise will generally gain market share from independent more higher priced retailers. –Larger stores are seeking tighter inventory control. –Take advantage of manufacturers excess production capacity. Corvallis Corvallis –Students love anything cheap –Not much direct competition –Large and small strip centers available for retail space. for retail space. –Sponsorships 

12. Threats Fixed price model limits power and gross margin enhancement. Fixed price model limits power and gross margin enhancement. –Margins pressured by merchandise cost, labor and shipping expenses and energy increases. –Competition for super centers and other discount stores, including other “dollar stores” (ie Dollar Discount and Fred’s). Corvallis Corvallis –Kmart, Bi-Mart, Rite-Aid, Ross (volume and quality)

13. Sources http://www.stores.org/pdf/06%20JULY%201- 100%20Chart.pdf http://www.stores.org/pdf/06%20JULY%201- 100%20Chart.pdf http://www.stores.org/pdf/06%20JULY%201- 100%20Chart.pdf http://www.stores.org/pdf/06%20JULY%201- 100%20Chart.pdf http://www.dollartree.com/ http://www.dollartree.com/ http://www.dollartree.com/ http://mason.wm.edu/NR/rdonlyres/B269B202- 3EBF-4F05-8AFA- 88AFA9520E9C/0/Dollar_Tree_REPORT.pdf http://mason.wm.edu/NR/rdonlyres/B269B202- 3EBF-4F05-8AFA- 88AFA9520E9C/0/Dollar_Tree_REPORT.pdf http://mason.wm.edu/NR/rdonlyres/B269B202- 3EBF-4F05-8AFA- 88AFA9520E9C/0/Dollar_Tree_REPORT.pdf http://mason.wm.edu/NR/rdonlyres/B269B202- 3EBF-4F05-8AFA- 88AFA9520E9C/0/Dollar_Tree_REPORT.pdf