Every Reject Shop about to disappear for good
A familiar fixture in Australia’s retail landscape, The Reject Shop, is on the cusp of disappearing for good.
Following its $259 million acquisition by Canadian discount giant Dollarama, the iconic Australian brand is set to be systematically phased out, replaced entirely by its new owner’s banner.
This strategic rebranding and expansion will not only alter the consumer experience but fundamentally reshape the identity and utilisation of hundreds of retail properties across the nation.
The transition, described by Dollarama CEO Neil Rossy as “methodical” and “slow and steady,” will see the 395 existing The Reject Shop locations gradually shed their longstanding identity.
“We are now starting to selectively phase in Dollarama products across categories,” he told Yahoo Finance.
“Along the way, we will be simplifying the price point structure, including lowering the current pricing ceiling.”
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The Reject Shop’s days of looking like this are numbered as its parent company, Dollarama, has revealed major changes are already happening.
A general view of a Dollarama logo and store in South Edmonton. On Wednesday, 24 August 2021, in Edmonton, Alberta, Canada. (Photo by Artur Widak/NurPhoto via Getty Images) · NurPhoto via Getty Images
There are more than 1600 Dollarama stores across the globe, and it’s Canada’s biggest retailer of “items for $5 or less”.
Mr Rossy did not confirm if prices would be that cheap across Australia, but indicated they would be coming down to turn the heat up on competitors like Kmart, Big W and Target.
UNSW consumer behaviour researcher Professor Nitika Garg told Yahoo Finance that consumers will likely be the big winners of this move.
“A lot of households are struggling to make ends meet right now, and the cheaper options are attractive,” Garg said.
“It will give competition to Kmart for this segment because they would look at their options when shopping.
“While the cost-of-living crisis is going on, you can see that it will work.”
When will The Reject Shop be replaced with Dollarama?
Dollarama’s ambitious expansion plans are intrinsically linked to the eradication of The Reject Shop.
The goal to grow from 395 to 700 stores by 2034 means that not only will existing Reject Shops be rebranded, but hundreds of new sites will be sought to establish Dollarama’s dominant physical presence.
“This will be a gradual process, which will continue through to the end of fiscal 2027,” he said,” Ross told Yahoo Finance.
He said that each Reject Shop will change its name once it contained a “critical mass” of Dollarama products.
“Our plan is to convert store layouts to deliver that convenient and consistent shopping experience we are recognised for, and which directly supports our merchandising strategy,” Ross said.
For commercial landlords, this signifies a significant investment in their leased premises, as the new tenant commits to transforming and modernising the physical spaces previously occupied by The Reject Shop.
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Mansi Shah, a regular customer of Rundle Mall’s Reject Shop, is disappointed the store is closing. Picture: Darren Chaitman
The complete disappearance of The Reject Shop brand will also have a tangible impact on retail property identity.
As a known entity for over four decades, its presence anchored many local shopping strips and centres.
Its replacement by Dollarama will necessitate a recalibration of how these retail sites are perceived and marketed.
UNSW consumer behaviour researcher Professor Nitika Garg told Yahoo Finance that Dollarama would have its work cut out.
“To really compete against Kmart, or to have a viable business model for the long-term, they would have to change their proposition,” she said.
“Either you increase the variety or you increase the quality… I think that’s the struggle that they will have with the increased store numbers.”
