As luxury department stores flounder, discount retailers are flourishing.
Dollarama opened 65 new stores across Canada during its 2023 fiscal year, which ended on January 29, and plans to open another 60 to 70 locations before the end of fiscal 2024.
The expansion plans were revealed in the dollar store chain's fourth quarter and fiscal year 2023 financial results, released on Wednesday. According to the documents, Dollarama's sales increased by 16.7% from fiscal year 2022 to over $5.05B.
"In the first half of Fiscal 2024, the Corporation expects to benefit from strong demand for its affordable, everyday items in the context of continued inflationary pressures on consumers," the financial results read. "These demand trends are expected to normalize through the second half of the fiscal year."
A spokesperson for Dollarama declined to reveal where the new stores would be located, but told STOREYS the company has a long-term target of having 2,000 stores across Canada by 2031. Currently, there are 1,486 locations in ten provinces and two territories.
"Dollarama is currently growing its footprint and not the other way around," the spokesperson said via email. "In terms of locations and timing, they will continue to be opened throughout the year and across Canada."
The discount retailer's growth coincides with the decline of some higher-end chains in the Canadian market.
In February, Bed Bath & Beyond revealed that it would be closing all 54 of its Canadian stores and winding down operations across the country. The retail chain is insolvent, and will close its 11 buybuy BABY stores as well.
Less than a month later, Nordstrom followed suit. In an attempt to streamline its business and bolster profits, the department store chain plans to close its six Canadian Nordstrom stores and seven Nordstrom Rack locations, and shut down Nordstrom.ca.