How To Keep Dollar General Out Of Your Town

Dollar stores driving out local businesses in many pocket-sized towns

Kingsley, Iowa is home to ane,400 people.

"Everybody knows everybody," said resident Chet Davis.

Davis owns the town'due south single grocery shop: Chet'southward Foods. The store has been operating for decades, and Davis' family has owned it for more than than 40 years.

Generations of the customs have come up through these doors, but now, Davis is worried this neighborhood staple may accept an expiration engagement.

"Whether we can make it the residual of the yr, I don't know," said the begetter of 4 and gramps of eight.

Davis said his store's sales took a big hit when a new neighbour moved in but a few blocks away.

"This yr, nosotros had a Dollar Full general open up in Kingsley," he said.

After the discount shop opened, Davis said his profits dropped past about 20-percent.

"It's disheartening," said Davis. "You lot but practice what you can, and that's all y'all tin can do, so you just gotta kind of accept it. But you don't want to; you want to fight information technology."

The loss in income is something he tin't beget for long.

"Information technology costs u.s.a. $2,000 a month simply in electricity," said Davis, equally he pointed at the common cold storage within his store that'southward necessary to keep frozen products, meats and produce fresh.

But Davis has a bigger worry: the loss his entire town is about to run into.

"If we lose our store here in town, if y'all want a head of lettuce, y'all'll have to bulldoze 25, 30 miles. They ever talk about a food desert, and that's what we'll take here if we stop upwards having to close the store similar we did the other ane," said Davis, referring to his second grocery store simply a few miles away.

What used to be a space packed with fresh produce is now empty, collecting dust. Davis and his family were forced to close merely over ane twelvemonth after Dollar General opened right next door.

"They came in and took about 30 pct of our business right off the summit. A fiddling bit of information technology came dorsum, but non plenty to pay the basic bills," said Davis.

Davis' story is a snapshot of the incredible growth of dollar stores across the United States over the last decade.

There are more than 33,185 stores across the state. That's more than all the Starbucks and McDonald's in the U.S. combined.

Source: Thinknum Alternative Data and James Mattone

With three new dollar stores opening each day on boilerplate, these deal stores are growing faster than any other type of store.

Much of the dollar store success is born of strategy: inundation small town Us with stores.

Making a trip to the dollar store is closer and just as affordable as driving to the nearest big box shop.

Crystal Ghassemi with Dollar Full general said the visitor is non looking to supersede local businesses.

"We're going into communities that, candidly, other retailers are choosing non to serve," said Ghassemi. "The fact that we accept an boilerplate basket size of $12, really highlights that customers are looking to us to fill up in, to supplement broader grocery runs, instead of filling up," she said.

Stacy Mitchell of the Establish for Local Self-Reliance said a major trouble is the number of stores in local communities.

"When you come into a neighborhood and you lot open up dozens and dozens of stores and frequently calculation stores a block away from an existing shop, your goal is not to become another option in the marketplace, your goal is to own the market, to create a situation where there's no room for anybody else," Mitchell explained.

The landscape in Kingsley is a familiar one beyond the country illustrating but that. People there can store at any of a scattering of dollar stores within x or xv miles. The closest Walmart is more than than twenty miles away.

Another issue at play is food deserts. Dollar stores often open in rural areas with few or no grocery stores.

Now, Dollar Full general is working to make full that void past expanding the chunk of stores that offering groceries and building three new "cold storage" distribution centers in Bowling Green, Kentucky, Ardmore, Oklahoma, and West Sacramento, California.

Analysts say groceries could help dollar stores go toe-to-toe with giants similar Walmart and help them compete with grocery stores and mom-and-pop shops.

"Dollar Full general and Family Dollar are now a bigger grocer than Whole Foods is," said Mitchell.

For shoppers, there is a demand for both the grocery store and the dollar store, despite the consequences of the rivalry.

"In that location was a lot of controversy, but I recall people who were against it are using information technology at present," said Marilyn Richardson, who lives in Kingsley.

Richardson said she gets her groceries at Chet's but goes to the dollar store for wear items and newspaper goods.

The demand for both is a reality Davis doesn't ignore.

"There's a place for them. It'southward just what they do to everything else, information technology only destroys," said Davis.

The danger to his family unit'southward livelihood—a painful feel he'southward working to relieve.

"Here, we raised our family, and our kids all went to schoolhouse, and then it'due south near and dear to our hearts to keep things going for the people nosotros know that need us," said Davis.

But it'due south a need that goes both ways.

"Hopefully, our customers will help u.s. go on it going, considering once it'southward gone, it won't come back," he said.