Dollar stores are dominating retail by betting on the death of the American middle class

[SZonian]

Dollar General and other dollar stores are thriving while department stores struggle to survive — and their success is built on the death of the American middle class. 

 The Wall Street Journal reported that Dollar General has become one of the most profitable retailers in the US by opening more locations in places across the country that have continued to struggle economically. 

"The economy is continuing to create more of our core customer," Dollar General CEO Todd Vasos told the WSJ.

The company's target shopper comes from a household making $40,000 or less a year. 

[excerpted]
http://www.businessinsider.com/dollar-general-sales-soar-death-of-american-middle-class-2017-12

[massadvj]

Many American companies are finding success by targeting lower income people, including Dollar General, Walmart and McDonald's.  It is why the American lower classes have access to more goods and services, of a higher quality, than the middle classes of most countries around the world.  I consider this a good thing, not something Dollar General should apologize for.

[thackney]

The Dollar General in our tiny town probably sells 4 times as much grocery as everything else.

[driftdiver]

Many American companies are finding success by targeting lower income people, including Dollar General, Walmart and McDonald's.  It is why the American lower classes have access to more goods and services, of a higher quality, than the middle classes of most countries around the world.  I consider this a good thing, not something Dollar General should apologize for.

@massadvj
So we should take pride in our poverty?

[massadvj]

@massadvj
So we should take pride in our poverty?

No, we should take pride in the fact that capitalism is sufficiently robust in this country to accommodate the needs of all economic strata, at least in the food and consumer nondurable sectors.  Dollar General is not causing the US middle class to shrink, globalization and technology are, with misguided government intervention as an accelerator.

[Oceander]

I doubt if this has anything to do with the death of the middle class and more to do with the fact that the middle class is more and more turning to online shopping while the lower classes cannot (you generally need a credit card to shop online and poorer people have a much harder time getting one than does the middle class). 

[thackney]

I doubt if this has anything to do with the death of the middle class and more to do with the fact that the middle class is more and more turning to online shopping while the lower classes cannot (you generally need a credit card to shop online and poorer people have a much harder time getting one than does the middle class).

You can shop online with a debit card.  You don't have to have good credit to buy online. 

[Applewood]

Within a 20 mile radius of my house, I have four stores with the word "Dollar" in them, plus a Five Below (everything is $5 or less).  My immediate neighborhood is impoverished, but there are high class communities close by.  These discounters seem to thrive, not just among the poor, but the affluent as well. 

Alas, the local Big Lots closed a few years ago.  Of all the cheap stores, Big Lots was my favorite.  Used to buy a giant size bag of cellulose sponges there for a dollar.  The sponges were all rejects due to size, shape, cut, maybe the color was off -- nothing that would interfere with absorbency.  As long as the sponges did what they were supposed to, I didn't care about trivial defects.

[TomSea]

I think the premise of the thread is a bit overstated, "betting on the death of the American middle class", I know they are successful as 7-Elevens have been in the past and so on. They have some good things but also have quite a few bad things.

There use to be the 5 and dime stores. Aren't dollar stores sort of a variation on those?

[roamer_1]

I doubt if this has anything to do with the death of the middle class and more to do with the fact that the middle class is more and more turning to online shopping while the lower classes cannot (you generally need a credit card to shop online and poorer people have a much harder time getting one than does the middle class).

Well, no... I don't have credit cards as a matter of principle. Debit cards and gift cards function precisely the same way online.  And I know a whole lot of poor folks (even by my standards), and they all use online services - Netflix and Amazon particularly.

[Suppressed]

Well, no... I don't have credit cards as a matter of principle. Debit cards and gift cards function precisely the same way online.

Not exactly.

Twenty years ago, thanks to the Fair Credit Billing Act, Dell gave me a $2,500+ computer for free when they tried to rip me off.  A debit card wouldn't give such protections.

[Oceander]

Well, no... I don't have credit cards as a matter of principle. Debit cards and gift cards function precisely the same way online.  And I know a whole lot of poor folks (even by my standards), and they all use online services - Netflix and Amazon particularly.

Simply demonstrating the dangers of relying on anecdote as evidence.  Viz. credit cards, you are an outlier, and no, they don't function the same as debit and gift cards online.  And statistically, poorer folks tend to have fewer credit cards - more or less by definition, since many of them don't have the income levels needed to qualify for one, and may not have the credit rating, either.

[Frank Cannon]

....since many of them don't have the income levels needed to qualify for one, and may not have the credit rating, either.

LOL. Like hell. You ever hear of Capital One? They issue cards to people walking out of bankruptcy court.

[Oceander]

LOL. Like hell. You ever hear of Capital One? They issue cards to people walking out of bankruptcy court.

You ever hear of secured credit cards?  You do know, btw, that if you just got out of bankruptcy court with a discharge, you can't file again for at least 7 years, so you're not that bad of a credit risk for a well-advised bottom-feeding firm.

Why put so much effort into being so effing stupid on such a simple point?

[Oceander]

In 2001, only 17 percent of unemployed individuals had credit card debt. Around 27 percent of those with part-time jobs had credit card debt. And full-time employees were most likely to take on credit debt, with 32 percent carrying balances.

source:  https://www.debt.org/faqs/americans-in-debt/demographics/  (scroll down to the "Debt and Income" section)

[Frank Cannon]

You ever hear of secured credit cards?  You do know, btw, that if you just got out of bankruptcy court with a discharge, you can't file again for at least 7 years, so you're not that bad of a credit risk for a well-advised bottom-feeding firm.

Why put so much effort into being so effing stupid on such a simple point?

Really? Someone with a bankruptcy under their belt is an reasonable risk because they can't file again for 7 years? These people are judgement proof because they have nothing to take if they don't pay. It's unsecured. That's why delinquency rates are at danger levels again and the used car market is flooded with repo cars.

I make a living off these losers in my business. The moment they get their EIC from the IRS in spring they head out and put it down on a car and it is repoed within 4 months. All these deadbeats also have a wallet full of plastic. Bad credit means shit in this country anymore.

[RoosGirl]

You ever hear of secured credit cards?  You do know, btw, that if you just got out of bankruptcy court with a discharge, you can't file again for at least 7 years, so you're not that bad of a credit risk for a well-advised bottom-feeding firm.

Why put so much effort into being so effing stupid on such a simple point?

There are people here that have to put very little effort into being 'effing stupid', so I guess Frank has that going for him.

[Free Vulcan]

I love the Dollar General. They're putting them up all over here in the Midwest in smaller towns with good traffic. Not only do they have great prices on most things, they truly are like the old general store with most of the basics except produce.

It's nice living in a very rural area and not having to drive 30 miles anymore just to get a few of the essentials, and save money too.

[roamer_1]

Not exactly.

Twenty years ago, thanks to the Fair Credit Billing Act, Dell gave me a $2,500+ computer for free when they tried to rip me off.  A debit card wouldn't give such protections.

Nah - Vanilla One debit cards function the same way as credit in that regard. I have stopped payment and it works the same, just like I remember w. credit cards.

[thackney]

Not exactly.

Twenty years ago, thanks to the Fair Credit Billing Act, Dell gave me a $2,500+ computer for free when they tried to rip me off.  A debit card wouldn't give such protections.

Debit cards do give such protections but have more limits based upon when you report the fraud.

https://www.nerdwallet.com/blog/credit-cards/credit-card-vs-debit-card-safer-online-purchases/

Lost or stolen card reported before unauthorized transactions: zero liability.
Lost or stolen card reported within two days: $50 liability limit.
Lost or stolen card reported within 60 days: $500 liability limit.
After 60 days: no protection.

...The real difference between a debit card and a credit card when it comes to fraud is in how you get your money back. When a fraudulent transaction occurs on your credit card, you have lost no money. You can report the fraud, get a credit on your statement, and the issue will never affect your bank account.

With a debit card, your bank account balance is affected from the moment the fraudulent transaction takes place. If the transactions are significant, you could experience a domino effect of financial headaches. Fraudulent charges can tie up funds so that legitimate charges are declined or cause overdrafts.

[mountaineer]

There use to be the 5 and dime stores. Aren't dollar stores sort of a variation on those?

Good point.
There are three Dollar General stores within 8 miles of our home, plus a Dollar Tree that used to be a Family Dollar. One of the DG stores has grocery items - fresh produce, fresh meat, dairy, etc. - along with all the other household things and clothing. It essentially is a smaller version of Walmart, minus the furniture, paint and tires.

[ConstitutionRose]

Good point.
There are three Dollar General stores within 8 miles of our home, plus a Dollar Tree that used to be a Family Dollar. One of the DG stores has grocery items - fresh produce, fresh meat, dairy, etc. - along with all the other household things and clothing. It essentially is a smaller version of Walmart, minus the furniture, paint and tires.

It was a very big deal when one was built in Browns Summit because it was so far to a grocery store or hardware store, etc.  They had a decent selection of groceries plus any household supplies you needed. 

Where I live now - a mix of very high dollar homes and small cracker box houses with a very diverse population - there are 4 stores with dollar in the name and they are always busy. 

[IsailedawayfromFR]

Good point.
There are three Dollar General stores within 8 miles of our home, plus a Dollar Tree that used to be a Family Dollar. One of the DG stores has grocery items - fresh produce, fresh meat, dairy, etc. - along with all the other household things and clothing. It essentially is a smaller version of Walmart, minus the furniture, paint and tires.

I recall growing up Woolworth's and Kress's.  Both were five and dime where one would go get paper clips or other odd stuff.  A lot had soda fountains which are rare to find nowadays.

[Weird Tolkienish Figure]

Ridiculously idiotic article.

[Applewood]

I recall growing up Woolworth's and Kress's.  Both were five and dime where one would go get paper clips or other odd stuff.  A lot had soda fountains which are rare to find nowadays.

We had Woolworth's, Grant's, Murphy's and McCrory's.  McCrory's had a nice restaurant in the basement.  My mother's cousin waited tables there.  Grant's, which had a store across the street from my office, had a lunch counter where, on Fridays, I'd get a bowl of tomato soup, a grilled cheese sandwich and a soda for $1.50.  Murphy's downtown had a full grocery in the back, complete with a deli and a butcher.  I used to shop there sometimes on my way home from work.  Couldn't get near the place during the day -- it was so crowded. Woolworth's was dilapidated and on the decline by the time I started working downtown, but it still had the usual odds and ends at rock bottom prices.

I miss those five and dimes.  Maybe they didn't have everything Walmart and Kmart have, but at least they were intimate.  People who worked in stores in a neighborhood knew all the residents -- usually, they lived there.  Even the ones downtown were friendly and good places to shop.