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Will Five Below strike gold in California?

May 3, 2017Written by RetailWire Staff

Photo: Five Below

Five Below, the retailer that serves as magnet for pre-teens, teens and quite a few adults, as well, is moving westward as part of its plan to grow its store count from its current 550 to 2,000. The chain, which groups products into eight "in-store worlds" — candy, crafts, party, room, sports, style, tech and now — entered the California market for the first time last month with the opening of nine locations in the southern part of the state. "Our growth westward has been careful and strategic, and well worth the wait as we believe Five Below will have a tremendous reception and reaction in Southern California," said Joel Anderson, CEO of Five Below, in a recent statement to announce the chain's newest stores. "We're not just dipping our toe in the Pacific with these openings, we're diving in with nine stores and several more to follow within a matter of months," he said. "We expect California to be our largest state for stores in the coming years." Five Below has been on an accelerating growth track in recent years. The chain opened 62 new locations in 2014, 71 in 2015, 85 in 2016 and plans to add another 100 this year. Five Below, which sells goods for $5 or less, as its name claims, operates stores that are roughly 8,000-square-feet. It operates out of shopping centers that are anchored by national retailers. Last year, Five Below engaged in a soft launch of its e-commerce site last August. While not offering specifics, Mr. Anderson said the company was "very pleased" with the site's sales performance during Christmas. He said Five Below was "enhancing the assortment and mobile customer experience and will soon also be able to ship nationwide." The chain's net sales increased 20.2 percent last year to top $1 billion for the first time. Comparable sales improved two percent. Net income was $71.8 million, up 24.5 percent over 2015.

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