Discount chain closing 75 stores, admits 1,000s are 'substandard'

Businesses rarely come out and tell you that they have a bad product, but on rare occasions, embracing the need for change and admitting problems has worked to help turn a brand around.

In 2009, for example, Domino's shared some videos from its internal focus groups on YouTube.

"These video sessions were brutal. Consumers hated Domino's pizza. In one video, a woman said, 'Domino's pizza crust to me is like cardboard.' Another added, 'The sauce tastes like ketchup.' 'Worst pizza I ever had,' said a third," reported Business Age .

That turned out to be the kickoff for the company's "Pizza Turnaround" campaign, a reset for the brand, built around admitting that its core product needed work.

Dollar Tree is doing the same thing, although it's just admitting that many of its stores are "substandard," and planning to fix them, rather than actually running ads saying that.

In addition, the chain has committed to closing a number of locations in 2026.

Domino's acknowledging its lousy pizza worked because even bad pizza is pretty good, and even though sales had slumped before those ads ran, the company was still selling a lot of pizza.

Dollar Tree's admission hits a little harder because its stores are its product, and it's saying that an awful lot of them have significant room for improvement.

Scot Ciccarelli from Truist Securities addressed the issue during Dollar Tree's first-quarter earnings call .

"So you talked about making progress on the initiatives you provided at Investor Day. I think one of the ones that really stood out was your gold store goals and how the majority of your stores basically are substandard by your own metrics. So can you help us understand the progress that you've already made on improving the store standards?" he asked.

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CEO Michael Creedon answered him without pulling any punches.

"And just to correct, I think 42% is what we showed. So it wasn't the majority were below our standards. But if the average retailer is chasing 15% to 20% of their stores, we were chasing 42% below our standard," he said.

"So that's what I showed at Investor Day; that's significantly high. That's less than 1/3 today. So we haven't broken that out. But I'll tell you right now, that's less than 1/3, still not where we want it to be, but significant improvement," he added.

Dollar Tree, Creedon noted, has 9,400 stores "and change, turning these big QE2s are hard to do. I'm very pleased with the progress we've made over the past year."

"And as more and more stores are above our standard and approaching that grand opening look daily, the ones left to manage get easier to manage just because of volume. Every room in your house is a mess, it takes longer to clean it. As you start cleaning room to room, it gets easier to clean up the kitchen," he said.

A case study of the Domino's campaign for the Advertising Research Foundation (ARF) showed the blueprint the pizza chain used.