For more than three decades, Dollar Tree stores across the U.s. have touted a simple pricing model — everything is $1 — but the company announced Tuesday that growing inflation means it cannot sustain its business at those prices so price increases are coming soon.

The Chesapeake, Virginia, based discount retailer said prices will go up 25 percent to $1.25 starting early next year.

“Our Dollar Tree pricing tests have demonstrated broad consumer acceptance of the new price point and excitement about the additional offerings and extreme value we will be able to provide,” said Michael Witynski, President and Chief Executive Officer. “Accordingly, we have begun rolling out the $1.25 price point at all Dollar Tree stores nationwide.

The company said in a statement that the decision to increase prices was “permanent and is not a reaction to short-term or transitory market conditions.”

The company said the $1.25 price point, which will apply to a majority of Dollar Tree’s assortment, will allow the company to expand its offerings, introduce new products and sizes, and provide families with more of their daily essentials. Previously, the $1 price cap had caused the company to stop offering some products altogether and others were only offered in small-sized packages.

Dollar Tree, a Fortune 200 Company, operated 15,966 stores across 48 states and five Canadian provinces as of October 30, 2021. Stores operate under the brands of Dollar Tree, Family Dollar and Dollar Tree Canada. To learn more about the Company, visit www.DollarTree.com and www.FamilyDollar.com.