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Spring, 2005
 Content: • Just a dollar
Once the repository for oddball merchandise, dollar stores gain in popularity Whether fueled by a stop-and-go economic recovery or by a country of increasingly bargain-conscious consumers, dollar stores, once the retail marketplace where good (and not so good) products went to die, have become a bustling industry that has tripled in size over the past decade. Most stores in this retail niche, which offers snack foods, household products and other items, stick militantly to the 99-cent or $1 price point. "All day I get asked 'How much is this?'" said Kareen Gilani, manager of the A Dollar store at the Berkshire Mall in Lanesboro. "They don’t always believe that [our products] are only a dollar." Other chains, such as the Charlotte, N.C.-based Family Dollar Stores, carry a limited number of items that sell for $10 or more. Dollar stores once served as the home of last resort for a wide assortment of closeouts, irregular or slightly damaged goods, and other oddball merchandise. More and more, however, brand-name products are popping up across the board.
These goods, such as Tide washing detergent, Crest toothpaste and 2-liter bottles of Coca-Cola, accounted for 36 percent of Family Dollar sales last year, company Executive Vice President George Mahoney said. "[Customers] can see what outstanding value we offer because they can recognize that the prices on these nationally advertised brands are very good and that gives credibility to the entire store," he said. That strategy, which has been adopted industrywide, appears to be working. Great buys "Usually they have designer goods here at a reasonable price. You can pick up some great buys," shopper Meighan Scire of Great Barrington said during a recent interview at A Dollar. Scire said she was shopping for party favors for her daughter's baby shower, but also keeps an eye out for seasonal items she can buy "in quantity." Gilani said it is not uncommon for customers to ring up purchases for as much $50. Mahoney said the average Family Dollar receipt is for $8.67. Families with household incomes under $40,000 represent the average Family Dollar customer. Bob Rustick of Kinderhook, N.Y., said he came into the A Dollar store looking for one item: a brand of Atkins-friendly peanut butter cups that he makes sure to stock up on whenever he's in the area. "Three for a dollar; you can't go wrong," Rustick said, holding up the candy. The stores traditionally are small compared to other discount retailers, usually under 10,000 square feet, short on fancy displays, and -- unlike Wal-Mart or big-box retailers -- most often nestled within corner stores or strip malls in urban centers. "I think the appeal of the concept is the combination of convenience and the everyday low prices. You don't pay a premium for that convenience," Mahoney said. "That combination has fueled our growth." Most of the 70-something A Dollar stores are located within malls, Gilani said. "You generally won't find our stores in the more affluent suburban shopping malls. The rent would be too high for us in those markets. We try to keep our expenses down so we can offer very good values." Increasingly, though, higher-income customers looking for a bargain are being drawn to these sort of chains, industry analysts say. According to The Wall Street Journal, about a quarter of Americans with household incomes of more than $100,000 had shopped at a dollar store at least once in the last six months. The Journal places the number of dollar stores in the U.S. at 16,000, up threefold from 10 years ago. Family Dollar added more than 3,000 new stores in the last decade, 2,000 of them in the last five years. The most rapid growth has been in the Northeast, Mahoney said. Now at more than 5,500 locations in 44 states, Family Dollar has two stores in Pittsfield, at 631 North St. and 457 Dalton Ave., and a third in North Adams at 45 Veterans Memorial Drive. The third-largest dollar retailer, Dollar Tree Stores Inc., has one store in Berkshire County at 694 Merrill Road, Pittsfield. The largest national chain, Dollar General of Goodlettsville, Tenn., does not have a presence in Massachusetts and no plans have been announced to expand into the state, said Tawn Earnest, spokeswoman for the 6,700-store chain.  RETURN TO TOP |
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