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Dollarama
Dollarama
from Wikipedia

Dollarama Inc. is a Canadian dollar store retail chain headquartered in Mount Royal, Quebec.[3] Since 2009, it has been Canada's biggest retailer of items for five dollars or less.[4] Dollarama has over 1400 stores and is active in all of Canada; Ontario has the most stores.[5]

Key Information

History

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Rossy S Inc.

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The first all-dollar store was founded in Montreal in 1910 by Salim Rassy, a Lebanese immigrant, whose name became Rossy.[6][7] His son George took over the retailer in 1937 and led the company until his death in 1973 when grandson Larry Rossy assumed leadership of it when it had 20 stores.[6]

Dollarama

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The discount retailer grew to 44 stores by 1992 which until then operated under the corporate name Rossy S Inc. but traded simply as Rossy (not to be confused with Rossy Michael Ltd., a similar chain founded in 1949 by another son of Salim Rassy[8]). That year, Larry Rossy opened the first Dollarama at the shopping center "Les Promenades du St-Laurent" in Matane. The Dollarama division rapidly overtook Rossy S as the primary source of revenue for the Rossy family. Locations of Rossy S were rare after 1997 and the chain quietly disappeared by the turn of the new millenium with all of its stores either closed outright or converted into Dollarama branches. After converting all the locations to the dollar store concept, Larry Rossy continued to open new stores eventually reaching 1,000 stores in 2015.[6] In November 2004, 80 percent of the chain was sold to a private equity fund Bain Capital for US$850 million.[9]

Post IPO

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Dollarama's initial public offering took place on 9 October 2009.[10] In 2013, Dollarama was planning to expand its market to Latin America, and made an eight-year agreement to share its business expertise and offer sourcing services to Dollarcity, a Salvadoran chain of dollar stores in Central America and Colombia.[11]

In 2016, Dollarama established a partnership with the Marco G. R. Enterprise, resulting in the sponsorship of the first edition of the Formula Windsor Championship.[12]

In 2018, Dollarama recalled over 50,000 children's toys due to dangerous levels of phthalates.[13]

The number of stores in October 2021 was 539 in Ontario, 379 in Québec, 134 in Alberta, 111 in British Columbia, 42 in New Brunswick, 41 in Manitoba, 40 in Nova Scotia, 40 in Saskatchewan, 25 in Newfoundland and Labrador, and 5 in Prince Edward Island.[14] The company announced that it would open 700 new locations across Canada (including a few replacements for some of the Great Canadian Dollar Store locations) in the aforementioned provinces as well as their first store in the Yukon Territory.

Acquisition of The Reject Shop

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On 26 March 2025, Dollarama announced they would be acquiring Australian discount retailer The Reject Shop for CA$233 million (A$259 million).[15] The investor presentation said it will deliver a “dollarama shopping experience” with a new store layout, design and merchandising experience.[16] The Reject Shop stores would be rebadged as Dollarama.[17]

Business practices

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A standalone Dollarama store in Toronto's Parkdale neighbourhood
Dollarama in Square One, Mississauga, ON

Many items are priced at $1.00 or less, and initially almost all items were priced as such.[9] In early 2009, Dollarama began to introduce items priced up to $2.00 (including $1.25 and $1.50 price points). The stores introduced items at $2.50 and $3.00 in August 2012. It again increased price points to include $3.50 and $4.00 items in August 2016. In 2022, Dollarama announced that its maximum price point would be increasing to $5.00.[18] This price level increase allowed the chain to acquire products from a greater variety of sources, including closeout sales.[19] Adjustments may eventually happen to all prices.[20] Dollarama has always had a No Return and No Exchange Policy, stating an item cannot be given back to the store once a purchase is complete.[citation needed]

Payment in Dollarama stores was once by cash only, until Interac debit cards were added as a payment option beginning in 2008. Gift cards began to be offered in 2011. As of 2015, all Dollarama stores also support contact-less Interac Flash payments. In March 2017, Dollarama announced that credit cards would be offered as a payment option at all stores by the end of summer 2018.[21]

Many Dollarama stores were opened in place of former locations of the now defunct BiWay,[citation needed] which closed after a series of dubious financial transactions involving a new owner of the parent operation.[22] Dollarama launched its online store on 21 January 2019 where it will sell many of its products in bulk.[23] Only 1000 of the roughly 4000 products offered in Dollarama stores will be sold online, namely items that are easily purchased in bulk.[24]

See also

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References

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Revisions and contributorsEdit on WikipediaRead on Wikipedia
from Grokipedia
Dollarama Inc. is a Canadian value retailer headquartered in , that operates a chain of offering consumable products, general merchandise, and seasonal items at low, fixed prices. Founded in 1992 by entrepreneur Larry Rossy with a single store in , , the company has grown into one of Canada's largest retailers by focusing on affordable everyday essentials such as household supplies, snacks, toys, and beauty products. As of November 2025, Dollarama operates 1,665 stores across all ten Canadian provinces and two territories, emphasizing convenient locations and a broad assortment of over 4,000 items priced up to $5. The company has pursued international expansion since 2013 through its majority-owned subsidiary Dollarcity in , which manages 658 stores in , , , , and as of June 2025, and via the 2025 acquisition of The Reject Shop, adding approximately 395 outlets in . In fiscal year 2025, ending February 2025, Dollarama achieved sales of $6.413 billion, a 9.3% increase from the prior year, driven by store expansions and comparable store sales growth, with net earnings of $1.169 billion.

History

Founding and early years

The Rossy family's involvement in retail dates back to the early 20th century, when Salim Rossy immigrated from Lebanon to Montreal around 1910 and began as a peddler selling household goods. His son, George Rossy, expanded the business into discount variety stores under the name S. Rossy Inc., establishing a network focused on affordable everyday items primarily in Quebec during the mid-20th century. By 1973, George's son, Larry Rossy—a third-generation retailer—assumed leadership of the company, which then operated 20 stores, and grew it to 44 discount variety outlets in Quebec by 1992 through strategic expansions in underserved areas. In 1992, Larry Rossy founded Dollarama Inc. as a of S. Rossy Inc., launching a distinct where all merchandise was priced at exactly $1 to appeal to budget-conscious shoppers amid rising and economic pressures in . The inaugural Dollarama store opened in April 1992 in , , by converting an existing variety store in the Les Promenades du Saint-Laurent ; this pilot emphasized a wide selection of non-perishable goods, household essentials, and seasonal items in a clean, organized environment. The concept quickly gained traction for its simplicity and value, differentiating it from traditional s. Throughout the 1990s, Dollarama prioritized organic growth by opening new locations and converting additional stores, concentrating first on before entering with its initial store in 1994. This expansion targeted urban and rural communities, leveraging the fixed-$1 pricing to attract families and low-income households during a period of economic recovery following the . By 2000, the chain had grown to approximately 100 stores, with the majority in and a growing presence in , establishing Dollarama as a regional leader in value retailing. In 2004, amid lingering economic uncertainty from the early downturn—including high and consumer caution—Dollarama reinforced its fixed low-price model through internal initiatives that unified store layouts, signage, and to enhance consistency and operational efficiency. This strategic focus coincided with a pivotal investment, as Bain Capital acquired an 80% stake for US$850 million, injecting capital to fuel national scaling while preserving the core $1 pricing that defined its affordability amid challenging market conditions; by year's end, the network approached 350 stores across six provinces.

Initial expansion and IPO

In preparation for its (IPO), Dollarama underwent significant financial restructuring between 2008 and 2009, including the repayment of substantial obligations and the preparation of audited consolidated in accordance with Canadian generally accepted accounting principles (). External auditors, including those referenced in the preliminary prospectus, reviewed the company's financial position to ensure compliance and transparency for potential investors. This process was essential as Dollarama, previously backed by since 2004, sought to deleverage its ahead of going public. The restructuring focused on reducing high interest expenses, which had reached $72.1 million in fiscal 2008, through planned repayments using IPO proceeds. Dollarama completed its IPO on October 16, 2009, offering 17.14 million common shares at C$17.50 each on the (TSX) under the DOL, raising gross proceeds of approximately C$300 million. This marked a transition from private ownership to a publicly traded entity, with an initial trading price that quickly rose to C$18.59 on the first day and further to C$19.95 amid strong demand. The proceeds were primarily allocated to reduction, including C$70 million to repay promissory notes, C$38 million to fully settle a , and additional funds for other outstanding obligations, resulting in a net reduction to C$487.1 million by November 2009. This financial maneuver not only strengthened the company's but also provided capital for future growth initiatives. Following the IPO, Dollarama accelerated its domestic expansion, leveraging the influx of capital to open new stores across . At the time of the IPO in 2009, the company operated approximately 550 locations; by the end of fiscal 2010 (January 31, 2010), this had grown to 603 stores through the net addition of 39 locations. This momentum continued, with the store count surpassing 1,000 by 2015, primarily through organic openings in underserved markets. The expansion was supported by a focus on efficient site selection and scalable operations, enabling the company to capture increased consumer demand for value retail during the post-recession period. Amid the economic recovery of the , Dollarama implemented strategic decisions to enhance portfolio efficiency, including the closure of underperforming stores and optimization of its holdings. For instance, fiscal 2010 expansions involved 41 new store openings offset by temporary closures of two locations, reflecting a deliberate approach to prune low-productivity sites while prioritizing high-potential areas. These measures ensured sustainable growth, minimized operational risks, and aligned investments with long-term profitability goals during a period of improving economic conditions.

Acquisitions and international attempts

Dollarama's initial international expansion efforts centered on Latin America through a strategic partnership with Dollarcity, a value-oriented retailer operating in Central American countries. In February 2013, the company entered into a licensing and services agreement with Dollarcity, providing business expertise, merchandising support, and global sourcing capabilities to help scale operations in , , and . This low-risk arrangement allowed Dollarama to test its discount retail model in emerging markets without immediate capital commitment, drawing on similarities in consumer demographics and economic conditions to Canada's value-seeking shoppers. Building on the success of this , Dollarama advanced to direct ownership in July 2019 by acquiring a 50.1% equity in Dollarcity for approximately $90 million, a transaction that was immediately accretive to earnings. The move established Dollarcity as Dollarama's second core growth platform, enabling deeper integration of its proven efficiencies and product assortment strategies across the region. Under this ownership, Dollarcity expanded aggressively, more than tripling its revenues since 2019 while entering new markets such as and planning further penetration into ; Dollarama subsequently increased its stake to 60.1% in June 2024 for an additional $107 million, solidifying control and alignment with long-term expansion goals. In a significant escalation of its global ambitions, Dollarama entered the Australian market in 2025 through the full acquisition of The Reject Shop Limited, the country's largest discount variety retailer, for an enterprise value of approximately C$233 million (A$259 million). The deal, completed in July 2025, encompassed over 390 stores primarily in regional and suburban areas, providing an established footprint in a market with comparable demand for affordable everyday essentials. Dollarama plans to apply its operational playbook, including optimized sourcing and store formats, to grow the network toward 700 locations by 2034, with gradual rebranding to the Dollarama name expected by 2027 to enhance brand consistency. While integration remains ongoing, early focus areas include leveraging Dollarama's North American supplier network to address local sourcing challenges and improve margins. These international initiatives reflect Dollarama's evolved strategy of prioritizing disciplined, phased entry into high-potential markets, beginning with collaborative models to mitigate risks before pursuing ownership. The Dollarcity experience demonstrated the viability of exporting its fixed-price, high-turnover model to , informing a Canada-centric supplemented by selective global diversification rather than broad, untested ventures. This approach has avoided the pitfalls of overextension seen in other retailers, emphasizing scalable operations and cultural to sustain profitability across borders.

Recent growth and challenges

During the , Dollarama's stores were recognized as essential businesses across , allowing the majority to remain open while implementing and physical distancing measures. This status enabled the company to serve customers seeking affordable everyday essentials amid economic uncertainty and lockdowns, contributing to a surge in low-cost shopping. In fiscal 2021 (ended January 31, 2021), total sales rose 6.3% to $4.03 billion, while comparable store sales grew 3.2% excluding temporarily closed locations, driven by a 29.1% increase in average transaction size despite fewer transactions due to restrictions. Post-pandemic, Dollarama accelerated its domestic expansion, reaching over 1,600 stores by early 2025, with a long-term target of 2,200 locations in by 2034. New store openings focused on underserved regions, including , where the company acquired land in for a new 1.6 million square-foot to support growth and reduce logistics costs in and beyond. Urban infill strategies also advanced, adding stores in high-density areas of , , and Atlantic provinces to capture additional market share without relying on international ventures. In the first quarter of fiscal 2026 (ended March 31, 2025), Dollarama opened 22 net new stores, reflecting steady progress toward its expanded network goals. Supply chain disruptions from global events, including lingering COVID-19 effects, port congestion, and geopolitical tensions, impacted Dollarama in late fiscal 2022 and early 2023, leading to inventory buildup to $957.2 million by January 2023 and occasional product shortages. To adapt, the company diversified its sourcing beyond primary imports from , incorporating more suppliers from to enhance resilience and mitigate risks from Asia-based delays. This strategy, combined with supplier diversity monitoring, helped stabilize operations and maintain gross margins around 44-45% during the period. In 2024, Dollarama announced a pilot for its platform, focusing on bulk case sales of select merchandise for delivery across , primarily targeting customers. Despite this digital initiative, the company emphasized its commitment to a brick-and-mortar model, with online sales representing a small fraction of —approximately $46 million in 2024—while prioritizing physical store expansion and in-store experiences.

Business operations

Store format and locations

Dollarama stores are typically around 10,000 square feet in size, with an average of 10,458 square feet across the chain as of February 2025, allowing for efficient product display and customer flow. The layouts emphasize open spaces to facilitate browsing, complemented by bright lighting and end-cap merchandising to promote impulse purchases and enhance the overall shopping environment. The company's location strategy prioritizes high-traffic areas, including strip malls anchored by major retailers, standalone urban sites, and both urban and rural communities. As of November 2025, Dollarama operates 1,665 stores in Canada across all ten provinces and two territories, reflecting steady expansion while maintaining a dense network in densely populated regions like Ontario. Store designs have evolved significantly since the , when early locations averaged just 5,272 square feet with simpler setups, to contemporary formats that incorporate modernized interiors for better operational efficiency. Since the early , select high-traffic stores have integrated technology to speed up transactions and reduce wait times. Dollarama's direct retail operations are primarily in , with expansion into in 2025 via the acquisition of The Reject Shop, operating approximately 395 stores there as of November 2025.

Merchandising and supply chain

Dollarama employs a direct sourcing model, procuring merchandise from a well-diversified base of established suppliers across more than 25 countries, with approximately 50% of its products imported directly, primarily from . This approach allows the company to maintain control over product quality and costs by bypassing intermediaries, while blending imported and domestic goods to optimize its assortment. Private-label brands, developed in collaboration with these vendors, form a key part of the inventory, enabling competitive pricing through exclusive, cost-effective alternatives to national brands. The company's distribution network relies on centralized facilities to streamline , including major centers in , , and , with a new 1.6-million-square-foot warehouse and distribution hub under construction north of , , set to open by late 2027 to better serve Western Canadian stores. Dollarama manages its warehousing and core distribution operations in-house, adopting a hybrid model that partners with third-party carriers for transportation to enhance efficiency and responsiveness across its network of over 1,500 stores. This setup supports timely replenishment, minimizing delays in product delivery to retail locations. Merchandising at Dollarama emphasizes dynamic rotations to keep offerings fresh, with an objective to refresh 25-30% of its stock-keeping units (SKUs) annually through data-driven analysis of , ensuring a balance of and seasonal items without relying on loss leaders. Inventory management follows just-in-time principles, which reduce holding costs by aligning stock levels closely with demand forecasts and turnover rates, a strategy that proved resilient during post-pandemic supply disruptions by enabling quick adjustments to shortages and fluctuating availability.

Pricing and product strategy

Dollarama employs a fixed-price model with tiers ranging from $1 to $5, designed to deliver consistent value without frequent adjustments for inflation on essential staples. The company introduced $3.50 and $4.00 price points in August 2016 to expand its assortment of higher-quality items while maintaining affordability. In 2022, it added the $5.00 tier to accommodate broader product offerings and offset rising costs, with most items still priced between $1 and $4 as of 2025. This approach allows Dollarama to absorb inflationary pressures on core goods, ensuring stable pricing for value-conscious shoppers. The retailer's product mix focuses on non-perishable items across key categories, including (48% of offerings, such as and products), general merchandise (39%, encompassing essentials, , and apparel), and seasonal goods (13%, like decorations). These categories target everyday needs, with products largely sourced from international suppliers to support low costs. Dollarama's core strategy emphasizes high-volume, low-margin sales to attract budget-driven consumers seeking reliable deals on necessities. Unlike traditional retailers, it avoids sales promotions, coupons, or , relying instead on everyday low pricing and frequent assortment refreshes—about 25-30% annually—to drive traffic and repeat visits without eroding . To address margin pressures from disruptions and , Dollarama accelerated the rollout of higher-priced items up to $5 in 2023, representing about 15% of its assortment by that year. This adaptation broadens selection in categories like household goods and toys without alienating its base of price-sensitive customers, who continue to embrace the expanded options.

Financial performance

Dollarama's fiscal year ends on the Sunday closest to January 31 of each calendar year. The company's revenue has demonstrated consistent growth over the past decade, rising from $1.254 billion in fiscal 2010 to $5.053 billion in fiscal 2023, $5.867 billion in fiscal 2024, and $6.413 billion in fiscal 2025. This expansion reflects a compound annual growth rate of approximately 11% from fiscal 2010 to fiscal 2025, driven primarily by network growth and resilient consumer demand for value-oriented retail. Comparable store sales, a key indicator of organic performance, have shown variability post-2020, with annual growth rates of 1.7% in fiscal 2022, 12.0% in fiscal 2023, 12.8% in fiscal 2024, and 4.6% in fiscal 2025. Profitability has remained robust, supported by efficient and a focus on low-cost operations. Gross margins have hovered between 43% and 45% in recent years, reaching 44.5% in fiscal 2024 and improving to 45.1% in fiscal 2025, attributable to favorable product mix shifts, reduced logistics costs, and controlled shrinkage despite inflationary pressures. has grown accordingly, from $801.9 million in fiscal 2023 to $1.011 billion in fiscal 2024 and $1.168 billion in fiscal 2025, reflecting higher volumes and margin stability. Key drivers of include store expansions, which accounted for roughly 60% of total growth in fiscal 2025 through the addition of 65 net new stores in , complemented by 40% from comparable store increases. Additionally, fluctuations impact profitability, as Dollarama sources over 80% of its merchandise from abroad, primarily in U.S. dollars; a stronger relative to the U.S. dollar can lower import costs and bolster margins, while the reverse exerts upward pressure on cost of . Dollarama initiated a quarterly in fiscal 2012, marking its first payout of $0.09 per common share, with subsequent increases reflecting sustained earnings growth. By fiscal 2025, the quarterly had risen to $0.106 per share, paid in August, November, February, and May, providing a yield of approximately 0.23% based on the at the time. This policy underscores the company's commitment to shareholder returns amid expanding operations, with dividends funded by strong generation exceeding $1 billion annually in recent fiscal years.
Fiscal YearRevenue (CAD millions)Comparable Store Sales Growth (%)Gross Margin (%)Net Income (CAD millions)
20101,254N/AN/AN/A
20235,05312.043.5802
20245,86712.844.51,011
20256,4134.645.11,169

Stock performance and investor relations

Dollarama Inc. trades on the under the DOL. The company went public in October 2009 with an initial share price of CAD 17.50, raising approximately CAD 300 million in gross proceeds. By November 2025, the stock price had risen to approximately CAD 197, reflecting substantial long-term appreciation driven by consistent store expansion and . This growth propelled Dollarama's to over CAD 50 billion, establishing it as one of Canada's largest retailers by market value. Key milestones in Dollarama's stock history include its addition to the S&P/TSX Composite Index in December 2010, which enhanced its visibility to institutional investors and contributed to increased trading volume. Since 2018, the company has executed share buyback programs totaling approximately CAD 1 billion, reducing outstanding shares by about 39% from IPO levels and signaling confidence in its undervaluation. Analyst coverage remains positive, with a consensus "Moderate Buy" rating as of late 2025, supported by projections of sustained revenue growth amid economic pressures favoring discount retail. Dollarama maintains robust practices, including quarterly earnings conference calls that provide detailed updates on financial results and strategic initiatives. reports consistently emphasize long-term growth through store network expansion and enhancements, while ESG disclosures began in fiscal 2021 with comprehensive reports aligned to standards like SASB and TCFD. The stock experienced volatility in 2022, with shares dipping amid global disruptions that affected availability and costs. Recovery followed in 2023–2025, as Dollarama navigated these challenges through diversified sourcing and operational resilience, leading to share price gains exceeding 100% over the period amid broader retail sector strength.

Corporate affairs

Leadership and governance

Dollarama's leadership is headed by President and Neil Rossy, who assumed the role on May 1, 2016, succeeding his father, founder Larry Rossy. Prior to his appointment as CEO, Neil Rossy served as Chief Officer and had been a director on the board since , bringing extensive experience in operations and merchandising from his involvement with the company since its in 1992. Larry Rossy, who founded Dollarama and led it through its initial growth, chaired the board as Executive Chairman until June 2018, when he stepped down and was named Chairman . The board of directors is currently chaired by Stephen Gunn, an independent director who has held the position since June 2018 and previously served as Lead Director since 2009. The board consists of 10 members, the majority of whom are independent, ensuring oversight separate from management. Key governance practices include an audit committee responsible for financial reporting and internal controls, as well as full compliance with Canadian securities regulations under the Toronto Stock Exchange and National Instrument 52-110. The company maintains robust corporate governance standards, with regular board evaluations and risk oversight committees. The executive team features Patrick Bui, appointed effective December 18, 2023, following a series of planned transitions in the role. Other key executives include Johanne Choinière and Nicolas Hien. Rossy family members hold significant insider ownership, with Neil Rossy personally owning approximately 1.95% of shares as of mid-2025, contributing to a total insider ownership of about 2.3%. (https://www.tipranks.com/stocks/dlmaf/ownership) Dollarama emphasizes , as demonstrated by the orderly CEO transition in 2016 and subsequent executive appointments, to ensure continuity in . The company also pursues diversity initiatives, maintaining female representation on the board above 30% as of 2025, with ongoing efforts to broaden diversity in future director appointments.

Sustainability and community involvement

Dollarama has implemented various sustainability initiatives aimed at reducing its environmental impact. The company phased out single-use plastic checkout bags and certain plastic products, such as cutlery and flexible straws, across its stores by the end of fiscal year 2024 in compliance with Canada's federal single-use plastics ban. To minimize waste, Dollarama reuses cardboard boxes for transporting products to stores and works with service providers to enhance recycling efforts. In terms of energy efficiency, the company focuses on retrofitting stores to reduce its operational footprint, as part of broader efforts to mitigate climate risks. For ethical sourcing, Dollarama conducts supplier audits through its Vendor Code of Conduct, emphasizing human rights and environmental standards in its international supply chain. On the community front, supports philanthropic efforts through corporate giving and in-store . In November 2024, in collaboration with the Rossy Foundation, the company announced $30 million in donations to 25 Canadian charities, selected with input from Dollarama employees, focusing on community support across the . These initiatives align with Dollarama's guidelines for domestic charitable contributions, excluding international or political donations except in humanitarian crises. Additionally, stores participate in local campaigns to aid food banks and other causes. Dollarama's environmental, social, and governance (ESG) reporting began formally in 2022 with the release of its first dedicated ESG report, which outlined a strategy including a commitment to reduce Scope 1 and 2 intensity by 25% by 2030 relative to 2019 levels. Subsequent annual reports, such as those for fiscal years 2023, 2024, and 2025, track progress on these goals and reflect updates, including a current target to reduce Scope 1 and 2 GHG emissions intensity by approximately 45% to 4.2 kg CO₂e/ft² by FY31 (ending February 2031) relative to the FY20 baseline of 7.7 kg CO₂e/ft², while addressing challenges like emissions from its import-dependent , which primarily affect Scope 3 categories. In 2022, Dollarama linked its ESG targets to its $1 billion syndicated credit facilities, tying interest rates to performance on emissions reductions and diversity metrics. Employee engagement at Dollarama incorporates social responsibility elements, with approximately 27,500 store employees as of February 2025. The company provides mandatory training for all hires on topics including anti-discrimination and , with management expected to promote diversity and inclusion. Diversity standards are outlined in the , committing to and for bias, while plans for fiscal 2025 include adding diversity questions to surveys. Employees also contribute to community efforts through volunteer input on charitable selections.

References

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