Are dollar discount stores a benefit or hindrance to local economies?
The operators of 99 Cents Only Stores recently announced that they would be closing all 371 of their locations. This news comes shortly after the announcement that nearly 600 Family Dollar locations are also set to close this year. With the closure of these stores, some may question the future of the dollar store format, but experts say that these closures do not mean the end of dollar stores.
Despite the large number of closures, dollar stores are likely here to stay. The dollar store format has experienced significant growth over the past decade, with companies like Dollar General and Dollar Tree adding thousands of storefronts to meet the demand for low-cost options. However, in recent years, economic conditions have changed, leading to challenges for dollar stores.
Factors such as inflation, reduced government benefits for the Supplemental Nutrition Assistance Program (SNAP), and inventory losses have taken a toll on dollar stores. Dollar Tree CEO Rick Dreiling referred to the current environment as “very challenging” during a recent earnings call