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"Amid higher costs throughout the economy, consumers have begun shifting to lower-margin goods compared with higher spending on discretionary items earlier in t

by beezle 3y ago

"Amid higher costs throughout the economy, consumers have begun shifting to lower-margin goods compared with higher spending on discretionary items earlier in the post-pandemic period." If Family Dollar is not lower margin I'm not sure what is. My guess is they have mostly lost out to internet sellers and Walmart.

al_borland 3y ago
Historically, dollar stores do better during bad times. I’m wondering if Dollar General is what’s really hurting them. I hear people talk about Dollar General all the time, but almost never Family Dollar. DG seems to be the Walmart of the dollar store game.
- kerkeslager 3y ago
  Due to rock climbing, I spend a lot of time in poor rural areas (most recently, rural Tennessee). Dollar General has a few things going for them in these areas: 1. They seem to have very low staffing costs. Most stores seem to have at most 2 workers on staff at a given time (obviously this is higher in busier areas). 2. They seem to have no compunction about putting stores in pretty remote locations (example: [1]). This is probably enabled by having low staffing costs--a store doesn't have to make huge revenue if its costs are low. 3. They seem to have a very standard formula for new stores, which allows them to build them quickly. I've seen a flat lot with trees starting to grow in it, go to an open Dollar General in approximately 9 days. I can't imagine what sort of feats of organizational engineering allows that, but it has to be an advantage because it allows them to pivot into an area quickly. And I would imagine the non-descript buildings are fairly easy to sell, allowing them to pivot out of areas quickly as well. 4. Their competition in remote areas is usually gas stations. While DG isn't cheap compared to Walmart or Aldi, they're often about 2/3 the price of gas stations for a lot of items. [1] https://maps.app.goo.gl/3gwxaiNRtgqKiKJ28 https://maps.app.goo.gl/3gwxaiNRtgqKiKJ28
  - bombcar 3y ago
    Everything here is spot on with my experience. They also have little or no perishable items and so stocking becomes simpler, too.
FredPret 3y ago
Dollar stores generally have much higher margins than Walmart or Costco. They're more expensive per unit, but the upfront cash required by the customer is lower. For this reason (cashflow) they are seen as a good option for poor people, where in reality everyone would be better served by Costco if they had the cash and storage room to buy in bulk, and a car.

by beezle 3y ago

al_borland 3y ago

Historically, dollar stores do better during bad times. I’m wondering if Dollar General is what’s really hurting them. I hear people talk about Dollar General all the time, but almost never Family Dollar. DG seems to be the Walmart of the dollar store game.

kerkeslager 3y ago
Due to rock climbing, I spend a lot of time in poor rural areas (most recently, rural Tennessee). Dollar General has a few things going for them in these areas: 1. They seem to have very low staffing costs. Most stores seem to have at most 2 workers on staff at a given time (obviously this is higher in busier areas). 2. They seem to have no compunction about putting stores in pretty remote locations (example: [1]). This is probably enabled by having low staffing costs--a store doesn't have to make huge revenue if its costs are low. 3. They seem to have a very standard formula for new stores, which allows them to build them quickly. I've seen a flat lot with trees starting to grow in it, go to an open Dollar General in approximately 9 days. I can't imagine what sort of feats of organizational engineering allows that, but it has to be an advantage because it allows them to pivot into an area quickly. And I would imagine the non-descript buildings are fairly easy to sell, allowing them to pivot out of areas quickly as well. 4. Their competition in remote areas is usually gas stations. While DG isn't cheap compared to Walmart or Aldi, they're often about 2/3 the price of gas stations for a lot of items. [1] https://maps.app.goo.gl/3gwxaiNRtgqKiKJ28 https://maps.app.goo.gl/3gwxaiNRtgqKiKJ28
- bombcar 3y ago
  Everything here is spot on with my experience. They also have little or no perishable items and so stocking becomes simpler, too.

FredPret 3y ago

Dollar stores generally have much higher margins than Walmart or Costco. They're more expensive per unit, but the upfront cash required by the customer is lower. For this reason (cashflow) they are seen as a good option for poor people, where in reality everyone would be better served by Costco if they had the cash and storage room to buy in bulk, and a car.