Even the dollar store is struggling in this economy. Because of this, Family Dollar is making some tough decisions.

Family Dollar, a popular dollar store nationwide with 8,100 locations, will be closing about 370 locations due to low sales. Besides closing the stores, the company will be permanently lowering the price on over 1,000 basic items. It is unknown how many jobs will be lost due to the closings.

Family Dollar will recreate its "everyday low cost" items instead of using temporary sales and promotions.

Lately, many different dollar store chains, including Dollar General and Dollar Tree, are failing to meet their sales and earnings goals, but Family Dollar has been hit the worst. Analysts say the Family Dollar has made mistakes on pricing, merchandising and even the locations of its stores.

Less shoppers at dollar stores is a change from just a few years ago when these stores were packed full of customers seeking the extreme low prices during the recession. Wal-Mart has taken this opportunity to add smaller stores, smaller packaged items, and to boast its low prices. As low-income shoppers avoid stores even more, higher-income shoppers, who are enjoying better housing and stock markets, are heading back to the stores they are used to, and that doesn't include dollar stores.

With a long, cold winter in the northeast and midwest, utility bills pushed customers to do as much penny pinching as they could. Also, some 1.4 million Americans stopped receiving their weekly unemployment checks Jan. 1. With prices rising, wages are not. Workers in low-paying jobs are either seeing small or no increases in their wages.

Family Dollar, Inc. defines its core customers as female head of households making less than $40,000.

By closing the stores, Family Dollar said they'll reduce spending by $40 million to $45 million.