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Dollar stores raking in the dollars

December 21, 2018

Dollar Stores have something to celebrate as the year comes to a close: Their popularity just keeps growing.

The number of people shopping at such stores as Dollar General, Dollar Tree and Family Dollar grew by 3 percent year on year for the 12 months ended in October, and there has been a 7 percent spending increase in the category, according to a report from The NPD Group, a retail consulting and research firm. The average spend-per-consumer has risen from $165 to $171.

According to the report, roughly 40 percent of consumers surveyed plan to shop at a dollar store this holiday season.

Dollar-store customer traffic grew by 3 percent for the 12 months ended in October, and spending increased by 7 percent

It used to be that when the economy turned down, dollar stores’ fortunes rose, but that is not the pattern this time: Now the economy is growing at a lick, and so are dollar-store sales and traffic.

“Dollar stores’ old bargain-based reputation is now more about value and variety, expanding their reach among consumers,” said Marshal Cohen, NPD Group's chief industry adviser. “Especially during the holiday shopping season, time-starved consumers are attracted to one-stop retailers that help them minimize the surge in their spending.”

Nearly a third of dollar-store spending comes from households with annual income of $100,000 or higher

People of all income levels are patronizing dollar stores, not only those with little to spare economically. “Nearly a third of dollar-store spending comes from households with incomes of $100,000 and higher,” notes the NPD report. The second-highest share comes from those earning $25,000 to $49,000.

“Older Gen X-ers, between 45 and 54 years of age, are the primary dollar-store buyer, representing 30 percent of spending,” the report said. “However, younger consumers are also engaging with dollar stores.”

By Edmund Mander

Director, Editor-In-Chief/SCT

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