Dollar stores having seen climbing sales lately — millennials have found their charm and have chosen them with their wallets.
Both Dollar General and Dollar Tree reported a 2.2 percent improvement in same-store sales during the first quarter of 2016. Additionally, Dollar General “announced plans to add roughly 1,900 new stores over the next two years to bring its total count to more than 14,000,” Forbes’ George Anderson wrote.
Despite stereotypes that dollar stores cater to a low-income customer base, Reuters contradicted the generalization of their average customers.
“Of the millennials who shopped at Dollar General, Dollar Tree, and Dollar Tree-owned Family Dollar stores, in the year ended April, about 29 percent earned over $100,000 a year and accounted for about a quarter of sales at these stores, according to market researcher NPD’s Checkout Tracking, which tracks consumer receipts,” Sruthi Ramakrishnan and Siddharth Cavale reported.
With business looking up for dollar stores, others in the industry find it to be a generational shift that changes economic patterns.
“The big issue is not affluent millennials shopping in dollar stores,” Gene Detroyer, professor of the European School of Economics, told RetailWire.
“It is the rejection of traditional brands and accoutrements that previous generations were attracted to. Millennials would rather spend their money differently … they spend as little as possible on essentials and use it for experience, as small as a coffee or as big as traveling the world,” he continued.
The high-end brands and trendy stores are not prioritized by the 20-to-30 somethings.
“I get a lot of toiletries (at Dollar Tree), and those aren’t always name brands,” Freelance Copywriter Eric Brantner told Reuters. Brantner lives in Houston and earns roughly $100,000 a year, yet he prefers the convenience and pricing of the dollar store.
The trend speaks to millennial desires for information and materials at their fingertips, even if it means they skimp on a better-quality product a few miles farther away.
“The dollar stores are typically small-format stores that can be placed in local neighborhoods,” Chris Petersen, president of Integrated Marketing Solutions, told Forbes. “In many cases dollar stores have become the new convenience stores located at convenient drive-by locations for commuters of all income levels.”
