In good times and bad, Americans love a bargain. That's what first led many to go shopping in dollar stores for items such as greeting cards and wrapping paper. It's what has kept them going back for everyday consumables as operators in the channel have added grocery goods to their mix.
Every visit to a dollar store means a lost sale for another operator, be that Walmart or a supermarket chain. A recent Tampa Tribune article pointed to the growth of Dollar General in Florida, specifically its "Market" grocery format, and the impact it is likely to have on competitors in the state.
"The reputation of a dollar store comes with the territory, but we are actually not really a dollar store," Crystal Ghassemi, a Dollar General spokesperson told the Tribune. "A lot of people are starting to realize that we carry a lot of the most-popular brands on the shelf."
The Tribune article cited Kantar Retail research, which found that Dollar General offered lower prices than Walmart two years in a row. A separate pricing study done by Avondale Partners last year found Dollar General had lower prices than Walmart, as well.
In a Dec. 2012 RetailWire poll, 85 percent indicated they believed the competitive threat posed by dollar stores to other food retailers would increase over the next five years.
Which channel has the most to fear from dollar stores' push into groceries?