Family Dollar is the latest in a string of retailers to shutter stores.
The discount chain said it will close 370 underperforming locations this year, shed some of its workforce and lower the price of more than 1,000 basic items to cut costs. The company reported sluggish second-quarter sales Thursday, citing a multitude of factors including financially-strapped consumers and aggressive holiday discounting strategies.
The company’s net sales fell 6.1 percent in the second-quarter, while same-store sales dropped by nearly 4 percent.
Family Dollar didn’t specify which locations would close or how many jobs would be cut. The chain currently operates 8,100 stores.
Although retailers had a rough 2013, luxury stores and dollar stores managed to thrive while stores catering to middle-income shoppers struggled. But Family Dollar’s move shows that the end of unemployment benefits and cuts to the nation’s food-stamp program are starting to hit lower-income shoppers.
The company said it expects to save $40 million to $45 million with these cost-cutting measures. It will also slow the expansion of new stores, opening less than 400 locations starting in 2015.
“We are not satisfied with our results, and we hold ourselves accountable for improving our performance,” Howard Levine , the company’s chairman, said in a statement.