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Dollar Tree Warns of Impact on Consumer Wallets Following Chicago's Ban on New Stores

Feb 23, 2024 10:16 PM EST | By Jep Collins

(Photo : Pexels/KATRINBOLOVTSOVA)

In Chicago, dollar stores like Dollar Tree are now under new rules. This change comes after the city found many health and safety problems in these stores.

The Chicago City Council decided on Wednesday. They passed a law that puts these new rules on discount shops, including Dollar Tree. These rules ensure these stores follow health and safety standards more closely.

Chicago Clamps Down on Dollar Tree Stores

The Chicago City Council decided on Wednesday, with a vote of 42-7, to put tougher rules on dollar stores, including Dollar Tree, across the city. They agree that the growing number of these stores is causing problems in many West and South Sides neighborhoods.

This vital vote was on a plan made by Ald. Matt O'Shea from the 19th Ward. It was put off for nearly a month because lobbyists for Dollar Tree, Inc., who run Dollar Tree and Family Dollar stores, tried to stop it. According to O'Shea, there are 149 dollar stores in Chicago.

Chicago's dollar stores are now facing new rules. These rules apply to stores between 4,000 and 17,500 square feet, mainly selling items for less than $5. But these rules don't affect gas stations, pharmacies, pawn shops, flea markets, thrift shops, or particular stores.

Also, smaller stores with at least 10% of their space for fresh food like fruits, meat, seafood, and dairy products don't have to follow these rules.

Dollar stores need to put up signs with the owners' and license holders' names and emergency contact info. These stores must have an insurance policy worth at least $1 million.

Also Read: Macy's Announces Closure of 5 Stores in 2024, Cutting Costs Amid Economic Challenges

Dollar Store Chain Faces Heavy Fines, Increases Security

(Photo : Pexels/Pixabay)

In Chicago, there are 23 licensed Dollar General stores, around 60 Dollar Tree locations, and 66 Family Dollar stores. This information comes from the city's Department of Business Affairs and Consumer Protection, which looked at active business licenses.

Dollar Tree bought Family Dollar in 2015. Now, the company owns more than 120 stores in Chicago, mainly in the southwest and northwest parts of the city.

A CBS data analysis shows that more than 90 of these stores are within a mile of each other. This is about 75% of all Dollar Tree-owned stores in Chicago. In contrast, only 2 of the 23 Dollar General stores are this close to each other.

However, the new ordinance that Chicago is putting in place only affects the opening of new stores by the same owner. So, the existing stores won't be impacted by these new rules.

The company owning Dollar Tree, Dollar General, and Family Dollar has faced 3,300 city code violations since 2017, Alderman Matt O'Shea revealed. He led the effort to pass a new measure against these stores.

These violations include selling expired medication and baby formula. "In six years, the stores paid over $600,000 in fines in Chicago," O'Shea stated, emphasizing the large sum.

The measure took months to pass due to opposition from business groups and some council members. However, it gained significant support, with Alderman Jeanette Taylor of the 20th Ward citing concerns about store conditions and safety.

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