Mark Lacter • February 7 2012 9:35 AM
http://www.laobserved.com/biz/2012/02/where_are_the_dollar.php

Virginia, Mississippi, Alabama and Louisiana have the largest concentrations of dollar stores. Indeed, something like a “dollar store belt” can be discerned, stretching from Ohio and Indiana in the north, through Kentucky and Tennessee to the Gulf Coast.

Within the District, there aren’t actually very many dollar stores per 10,000 residents, but it is worth noting that ones here tend to be found east of Rock Creek Park in less affluent residential neighborhoods.

http://www.washingtoncitypaper.com/blogs/citydesk/2012/02/07/the-dollar-store-belt/

Posted by Shani Hilton on Feb. 7, 2012 at 10:41 am

So stop by and see the new store and spend some Dollars while you are there!!

So if you are heading up Hwy 4 make a right on Tom Bell Road and the new store is on the left in the same shopping center as Eldorado Savings

Consumer experts said dollar stores were once considered “low class,” but the current state of the economy has nearly made the stereotype disappear.

“Everybody wants a deal. I think we tend to have this idea that the only people who are going to shop in these stores are lower-income people or people who absolutely need a bargain. That’s just not true,” said George Belch from San Diego State University.

Belch said as the stores become more popular, consumers can expect to see more store locations across the country.

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.

Dollar Stores Out-selling Other Retail Sectors
A 2011 survey conducted by America’s Research Group, reveals that Americans plan to stretch their dollars by shopping at discount chains rather than the 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, “Wal-Mart has a new enemy called the dollar store.” A study by Colliers International reveals that dollar stores have encountered such fast pace expansion that they are also currently outnumbering national drug store chains.

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, which has also allowed 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.
( http://independentretailer.com/2011/12/06/dollar-stores-prove-to-be-a-high-growth-retail-sector/ )

If Dollar stores are gaining ground on retail giant Walmart (WMT) its due primarily to location and convenience according to a recent consumer perception study conducted by leading market research firm ClickIQ, Inc. Consumers who had shopped a dollar store in the past month were surveyed on their retail shopping habits and the number one reason consumers cited for shopping Dollar General (DG [FREE Stock Trend Analysis]) is proximity to their home or work (71%). The second most cited reason for choosing Dollar General is “best everyday prices” at 57%. Of all respondents, 87% also shopped at Walmart in the past month.

According to the study, 57% of those who have shopped Dollar General in the past month live within three miles of the retailer. The average is 3.3 miles (self-reported). Respondents estimate that the nearest Walmart is about 5.4 miles away from their homes. 62% of Dollar General shoppers indicated that they would be extremely/very likely to shop Walmart if they had a store that was the same size and the same distance as their local dollar store.
“The economic reality of dollar store/Walmart cross-shoppers is also a factor in their choice of retailer,” said Robert Boese, VP Operations, ClickIQ. “The study showed that the average weekly grocery budget for families in this group is a self-reported $98. Furthermore, 20% of these respondents indicate that they are on some form of government assistance. This might explain why 55% of dollar store shoppers indicate that high gas prices influence them to shop retailers closer to home. With continuing high gas prices and unemployment, consumers appear to be calculating the ROI on each shopping trip.”

Methodology
Data was collected in an online survey with 399 of ClickIQ’s US consumer panel from July 5, 2011 through July 7, 2011. Target respondents had shopped at Dollar General at least once in the past month. The survey results have margin of error of +/-5% at a 95% confidence level.
About ClickIQ
ClickIQ, Inc., based in Minneapolis, Minnesota, is an award-winning market research firm that employs fully integrated online management tools, a proprietary consumer panel, and skilled market research analysts to deliver quantitative consumer and shopper insights to some of the best known and most respected companies across the U.S.

The dollar-store chain reports that its fastest-growing segment is customers who are making more than $70,000 per year.
GOODLETTSVILLE, Tenn. – Dollar stores haven’t lost their appeal to bargain hunters, Marketing Daily reports. Dollar General reports that wealthy shoppers continue to flock to their stores, making those with household incomes above $70,000 annually the chain’s fastest-growing customer demographic.

Half of the chain’s new customers are from non-core, higher-income families, with 22.4 percent in the $70,000 or more household category, said Rick Dreiling, chairman/CEO. Low prices initially are the attraction — the stores sell nearly a quarter of their products for a buck or under — convenience has become more crucial.

“We’ve made a radical shift,” said Dreiling. “We proudly sell both national brands and private-label, focusing on everyday necessities at compelling prices. We have a broad selection, but not very deep.”

Prices usually fall 41 percent under drugstore prices and 22 percent less than grocery store prices, but supercenters typically match dollar stores in cost. “But with an average size of 7,100 square feet and cost parity with supercenters that are 125,000 square feet, we are more convenient,” he said.

Dollar General also has revamped its marketing plan to use “our store as the communication tool,” and will be launching a new social media campaign. Customers still favor the chain’s low prices, which drives shopper loyalty.

Looking to the future, Dreiling pointed to expansion goals of 625 new stores and 550 redesigns in 2011, plus adding overall square footage by 7 percent per year. Dollar General hopes to add 11,000 new locations, including 8,000 in existing areas, and the rest in new states, such as California, Connecticut, New Hampshire and Nevada.

Walmart Forced To Compete With Dollar Stores For Customers

In May last year, I asked the musical question, “Can dollar stores survive an
economic recovery?” The collective answer seems to be a resounding “Yes!” Not
only are dollar stores surviving, they’re thriving and, according to an article
in the New York Post, that’s forcing Walmart to compete with them for the
lower-income shoppers that deserted them when the recession hit.

Several sources close to Walmart report that the company has begun vigorously
demanding that suppliers provide the cheapest items in any given product
category. That means pressing big partners like Procter & Gamble and Kraft Foods
to produce smaller, more affordable packages for everything from diapers to
laundry soap.

Walmart will also be looking for new manufacturers who can deliver lower prices
for cosmetics, party favors and greeting cards.

According to a recent survey of Walmart’s vendors, Family Dollar and Dollar
General pose the greatest threat to Walmart over the next five years. As
reported earlier, Dollar General has plans to open 625 new stores this year,
adding to the 9,200 stores already in operation. Family Dollar will open 300 new
stores in 2011.

The fact that dollar stores have more convenient locations and smaller package
sizes, appeals to lower-income consumers. And they’re not sacrificing quality,
either. Both Family Dollar and Dollar General carry some of the biggest brands
around, including Tide, Huggies and Campbell’s.

Even at dollar stores featuring items strictly $1 or less, you’ll find brand
name food, glassware and other household items like Sunbeam batteries. 99-cent
Only Stores carry products from Kraft, General Mills, Unilever and Cadbury, to
name just a few of its suppliers. And where else are you gonna get a five pound
bag of potatoes for under a buck?

If dollar stores can do it, I presume Walmart can, too. When dollar stores first
became popular, I noticed that some of the bigger stores made half-hearted
attempts to lure shoppers with dollar deal aisles. But it wasn’t necessary to
their bottom line and the idea pretty much petered out.

Walmart will likely be able to stock items priced right for lower-income
families but its large stores won’t be able to replicate the relaxed atmosphere
or thrill of the hunt that makes dollar stores a pleasure to shop in.

Marlene Alexander is a freelance writer and dollar store diva. She writes tips
and ideas for home decorating using only items from the dollar store.

Which has better bargains, grocers or dollar stores?

Real Simple’s Sarah Humphreys reveals which items you should be buying at the dollar store to save and which items are worth splurging on at the grocery store.

]]> http://www.buckstore.com/which-has-better-bargains/feed/ 0 http://www.buckstore.com/wall-mart-faces-challenge/ http://www.buckstore.com/wall-mart-faces-challenge/#comments Thu, 10 Mar 2011 15:58:22 +0000 admin http://www.buckstore.com/ Read More]]>

Wal-Mart (WMT) Investors to Focus on Domestic Results

Wal-Mart Stores (NYSE:WMT) has been making great strides in its global strategy,
but domestically it continues to struggle, as economic conditions continue to
favor competitors serving lower and higher income consumers.

During the deepest part of the recession Wal-Mart was the domestic leader, with
high-income consumers gravitating toward the discount retailer as they struggled
with everyone else.

The problem for Wal-Mart is dollar stores were eating into their lower-income
demographic at the same time, which hasn’t come back as they had hoped. Higher
income individuals have also went back to their usual retail stores now that
they’re on surer footing, putting pressure on them from that quarter.

That’s the challenge Wal-Mart faces domestically, and so far it appears they
don’t have any short-term answers.

With that as a background, shareholders and investors are going to zero in on
the domestic performance of the company for the Christmas season to give hints
as to the company’s fortunes over the next several quarters.

Wal-Mart’s domestic sales still make up about 75 percent of its overall revenue
of $405 billion annually. The bad news is same-store sales have dropped for six
quarters in a row in America.

The ongoing recession continues to take a bite out of Wal-Mart’s historic
demographic, and as mentioned, they continue to spread their money around at
dollar stores around the country.

Much of this is the fault of Wal-Mart, as they became schizophrenic concerning
who its core customer was, and moves like attempting to bring in higher-end
clothing and removing the big stacks of discounted goods to make the store look
roomier to appeal to a higher-income clientele hasn’t worked for them.

The long-term approach domestically for Wal-Mart is to return to its discount
roots and style, move into more urban areas, and to create a plethora of smaller
stores to compete with rivals who have been chiseling away at sales in targeted
product groups.

It’s not as if Wal-Mart is in trouble in the long term, but they’ve created a
problem that could weigh on the share price of the stock for some time as they
make the necessary transitions to spark domestic growth again.

International growth could help ease the pain during that time.