You've probably seen a Dollar General, Dollar Store or Family Dollar if you've driven more than 2 miles in America. If you drive more than 3 miles, you will most likely encounter all three.
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You don't need to be an economist to see how bargain outlets have spread across the U.S. It is psychologically comforting to know that everything is priced at a low price in any given store. Add in the crumbling American Dream and you have a recipe to business success.
This recipe is also filled with opportunistic fraudming as an infographic by Zachary Crockett at The Hustle demonstrates. You can't reach 34,000 stores in the US (each location is opening approximately every six hours) if you operate at a loss. This is done by convincing your customers that they are getting great deals on name-brand products, but in reality they are paying more.
Crocketts report states that Dollar General and Dollar Tree make an average gross profit ($0.30) for every $1 of sales. This is more than competitors like Target ($0.28) or Walmart ($0.24). It might seem like a great deal to buy Old Spice deodorant for $1. It is only 0.8 oz. and less than half the size of the 3 oz. standard. It is significantly more expensive than larger-sized products at other retailers on a per unit basis.
You are technically paying more for convenience. This is not a bad thing, considering that convenience stores can cost more.
Crockett says that the core of dollar stores is lower-income families earning less than $40K per annum. They are often struggling to make ends meet and cannot afford to purchase larger quantities even if they get a better deal.
These dollar stores are a result of desperation and profit. They have more stores than all the Walmarts and CVS and Walgreens combined. You might want to consider purchasing your pool floaties from Chef Boyardee Spaghettio, rather than buying them at Walgreens, CVS, Walgreens and Target.
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