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Dollar stores enjoying boom times
The worse the economy, the better for retailers of deeply discounted items. Partly fueled by higher-income shoppers "trading down," the popularity of dollar stores has risen sharply since the current recession began in December 2007.According to a study done by the Nielsen Co., high-income shoppers spent 10 percent more at dollar stores in 2008 than in 2007.
Marie Bowers, 66, shops at the Family Dollar in the Sterling Park Shopping Center. The retired graphic artist said she could shop for food, household items, clothing and beauty products at a large grocery chain store, but she prefers the Family Dollar.
As a woman whose parents lived through the Great Depression in the 1930s, Bowers said she appreciates value.
“I’m a frugal, cost-conscious shopper,” she said proudly. "This is my store."
Stores like Family Dollar are seeing their stock prices holding strong as well. Dollar stores are often seen as "recession-proof" stocks, and shoppers like Bowers are helping keep stock prices up in the current recession. The stock price of Family Dollar – the nation's second-largest dollar store chain – is up 42 percent this year, not only bucking the 37 percent drop in the Standard & Poor's 500 but ranking it as the top performer in the index.
For some shoppers, the appeal goes beyond prices to convenience and proximity.
Dollar stores have expanded beyond rural areas to more urban and suburban locations in recent years, and they have have moved aggressively into the food and beverage category by adding freezers and refrigerators.
These chains have also increased the number of stores accepting different payment types such as credit cards, electronic benefit transfer cards and food stamps.
Bowers said she likes shopping in a smaller store where the staff is easily accessible and the aisles are quieter and less crowded.
“The people here are friendly and helpful,” she says. “They really do feel like family.”
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