Dollar Stores on Roll

A 2011 survey, conducted by America’s Research Group, reveals that Americans plan to stretch their dollars by shopping at discount chains, rather than at pricier department stores and specialty chains, with 753 out of 1,000 survey participants picking discounters as potential shopping destinations. Britt Beemer, president of America’s Research Group, notes that even low price leaders will be faced with intense competition, saying, “Walmart has a new enemy called the dollar store.” A study by Colliers International reveals that dollar stores have expanded to the point where they outnumber national drug store chains.

Dollar Stores High Growth Retailing Sector

Dollar stores have become a force to be reckoned with, as they are among the hottest high growth retailing sectors. As wholesale topic writer, Claudia Bruemmer explains, “Posting some of the highest growth rates across retailing in recent years, largely due to rapid expansion, solid sales gains and increasing consumer interest,” dollar stores, both independently owned and chain operations, have seen significant expansion. The white paper, “Dollar Days: How Dollar Stores are Growing in a Weak Economy,” explains such rapid growth to be a result of consumer confidence in value and bargain buys.

It is true that some of the leading players in this retailing sector are dollar store chains, such as Dollar General, Dollar Tree, Family Dollar and 99 Cents Only, which are driving store traffic and upping transaction size by adding more high-turn consumables and improving in-store presentation. But it is the fact that dollar stores now serve a larger consumer base that allows many independent discount/dollar stores to thrive and pop up across the nation. In fact, a study by Retail Forward estimated that enough untapped and under-penetrated geographic markets exist in the U.S. to support another 15,000 dollar store retail outlets.