Dollar Tree 2013 Annual Report Download - page 6

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all categories – including our higher-margin discretionary product. We plan to expand
frozen and refrigerated product to an additional 320 stores this year, and we intend to
expand the frozen and refrigerated sections in 50 stores that already offer these products.
Another key component of our Growth strategy is the development of new retail
formats, the expansion of our geographic reach and the development of additional
channels of distribution. Specifically, that means Deals, Dollar Tree Canada and Dollar
Tree Direct.
Our Deals format extends our ability to serve more customers with more categories
and increases our unit growth potential. Deals stores deliver low prices on everyday
essentials, party goods, seasonal and home products. By lifting the restriction of the
$1 price point at Deals we are able to serve more customers with more products at
value prices every day. Our goal is to surprise and delight our customers with every
visit. Awareness of the Deals brand is growing and the concept is building momentum.
I am excited about the growth potential of Deals and particularly the opportunity that
it provides to grow profitably in higher cost-of-operation urban markets. We opened
29 new Deals stores in 2013 and ended the year with a net total of 214 stores across 18
states. We plan to continue this growth rate in 2014.
Our Canadian integration and expansion continues. We initially entered the Canadian
market via the acquisition of 86 “Dollar Giant” stores in the fourth quarter of 2010. In
the three years since then, we have set the foundation for long-term profitable growth in
the Canadian market while establishing the Dollar Tree Canada brand, expanding our
geographic reach and more than doubling our Canadian store count. We opened 41 new
stores in 2013 and ended the year with 180 Canadian stores, a 29% increase for the year.
We see enormous potential in Canada. As we grow and improve, we believe the
Canadian market can support up to 1,000 Dollar Tree stores. is is in addition to the
7,000 store potential for Dollar Tree in the United States plus additional growth in
our Deals format. Our goal is to be recognized by customers as the leading retailer in
Canada at the single price point of $1.25 (CAD) just as we are in the U. S. at the $1 price.
Dollar Tree Direct, our e-commerce business, is expanding as planned. is additional
channel of distribution provides an opportunity to broaden our customer base, drive
incremental sales, expand the brand and attract more customers into our stores. We
launched our e-commerce platform in early 2009. Since then, customers have been
discovering the value of Dollar Tree Direct in ever-increasing numbers.
Customer traffic on Dollar Tree Direct exceeded 21 million unique visitors in
2013, a 23% increase over 2012. Dollar Tree Direct and Deals Direct now have more
than 3,800 items available on-line, including more than 1,700 unique items that can
be purchased in less than case quantities – an increase of 50% from 2012. Dollar Tree
Direct is also gaining social-media popularity, with more than one million Facebook
Fans and over 1.1 million email subscribers as of year-end 2013. Dollar Tree Direct
is gaining customers every quarter and we expect to see sustainable growth in our
on-line business.
Corporate Governance and Shareholder Value
Dollar Tree has a long-standing commitment to responsible corporate governance
and to building value for our long-term shareholders.
Our Board of Directors is active, involved, and committed to responsible corporate
governance. e majority of the Board is comprised of independent directors; we have
a lead independent director and all of the standing committees of the Board consist
entirely of independent directors. e Board regularly reviews the Company’s governance
4 Dollar Tree, Inc.