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The economics of dollar stores

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Re: The economics of dollar stores

#151

Post by MomoXenosaga »

grae_QED wrote: post #148
hn_throwaway_99 wrote: post #101

So if I can summarize the article, the economics of dollar stores are "sell things for more than it cost to buy them". I mean, it seemed like the article wanted to have some nefarious take, but offering smaller quantities of items so people can afford them, even if the per-unit cost is higher, doesn't seem like some unexpected malicious intent. I mean, I certainly expect to pay more per gram if I'm buying a travel si…

[flagged]

I often go to a "cheap shit by the container load" retail chain called Action and they are always packed. And all kinds of people go there- Dutch people are infamous for their love of cheap and it's considered a point of pride. Capitalism always wins.

Re: The economics of dollar stores

#152

Post by pnutjam »

fennecfoxen wrote: post #27
gambiting wrote: post #22

Earlier quoted context omitted.

>>That's sometimes merited (payday loans!) That's also a very interesting discussion to have because from what I understand, payday loans businesses exist because the alternative is worse - people who are desperate will always borrow money from someone, so it's better that they borrow from a well regulated business rather than from the "pay or we'll break your legs" kind. And then the 1000% APR is argued that it's th…

At some point APRs really stop making sense for two-week loans. It's easier to understand what people pay in three parts: processing costs, a risk premium, and the lender's margin. Fordham Journal of Corporate & Financial Law estimated the margin at 3.75%. The argument against payday lenders is a paternalistic one with moralistic overtones, with all the potential flaws that might entail.

Ever had a payday loan? I'm guessing no.

Re: The economics of dollar stores

#154

Post by LambdaComplex »

grae_QED wrote: post #148
hn_throwaway_99 wrote: post #101

So if I can summarize the article, the economics of dollar stores are "sell things for more than it cost to buy them". I mean, it seemed like the article wanted to have some nefarious take, but offering smaller quantities of items so people can afford them, even if the per-unit cost is higher, doesn't seem like some unexpected malicious intent. I mean, I certainly expect to pay more per gram if I'm buying a travel si…

[flagged]

> If they thought they were being taken advantage of or manipulated then poor people wouldn't buy anything from dollar stores

I've seen people (whether they be college students or just people living paycheck to paycheck) talking about how they only have e.g. $5 USD to spend on groceries for the next two weeks (because that's how much they have in their bank account, and that's when payday is).

If your choices are "something you can pay for at the dollar store at a less-than-optimal unit price" or "something you literally cannot buy because its purchase price exceeds the number in your bank account" then you really don't have a choice.

Poor people don't want dollar stores; they just want to survive.

Re: The economics of dollar stores

#155

Post by streamofdigits »

Dollar stores are fascinating as they are the final piece of the puzzle in the long journey of organizing mass produced consumerist society. This started more than a century ago with the invention of (high end) department stores [0].

The end result is hardly satisfying (or stable): an unstopable stream of plastic pollution, toxic levels of sugar and a reliance on cheap labour in remote lands. All those factors are coming under scrutiny and pressure...

[0] https://en.wikipedia.org/wiki/Wanamaker%27s

Re: The economics of dollar stores

#156

Post by MarkusWandel »

The different purchasing power of US$ and CAD$ killed the "everything in the store is a dollar" model in Canada at least a decade ago. But Dollarama, which is so successful that it has pretty much squeezed out the other dollar store chains, has really just established themeselves as the "everything store" below the Walmart tier without any particular price - just low in general. Metal foil cookware, kids' party supplies and certain kinds of candy/sweets (I love their weird brand chocolate bars, particularly the "Island Bar" (Bounty clone) and Duoletta (Kinder Bueno clone). Also if you're out cycling they're a good place to buy things like Gatorade or chocolate bars for a reasonable price in quantity 1.

And sometimes a totally ubiquitous store with a predicatable inventory of crappy-but-adequate stuff can be a real problem solver. For example, hit the road with the small children for the long drive to Grandma's, and half an hour out we find that we have the fruit, but not the knife to cut it with. No problem, next Dollarama is 25 minutes away, we'll just grab a knife there. $2! With sheath. Sure it doesn't stay sharp as long, but it totally did the job.

Re: The economics of dollar stores

#157

Post by neilv »

> Dollar stores do this by going after the stuff nobody else wants: surplus items, discontinued products, and old stock that didn't sell well elsewhere.

My experience with Dollar Tree suggests additional methods:

* Smaller amounts of product in package (like the article mentions elsewhere).

* Substandard product. I've gotten everything from Sunbeam batteries, to name-brand envelopes that were obviously thinner than the same brand I'd bought elsewhere (to the point that my printer wouldn't even feed them), to criminally non-sticky fake "duct tape". I've also seen things that are obviously too small (lower cost to manufacture), like car window shades.

* Packaged food imported from outside the US, even with popular US branding on it.

* Prices in some cases the same or higher than another store nearby (e.g., $1.00 for a can of food available for $0.89 or less, within walking distance).

Before Covid, my favorite thing to buy there was Hefty brand zip-seal plastic bags. (I avoid Dollar Tree for things that go into or on the body, but the bags are fine for purposes like organizing non-ESD small parts, and providing some dirt and moisture protection of things in backpacks.)

Re: The economics of dollar stores

#158

Post by LegitShady »

mixmastamyk wrote: post #147

One thing I noticed at our local 99 cent store, and didn’t see mentioned in the thread… cashier wait times. There’s a large number of customers of course and they keep costs down with fewer cashiers. So you are looking at twenty minutes standing in line for your $8 in goods. I did this a few times and (combined with needing to drive there) and decided it was not really worth the savings from our quick/overpriced mark…

a similar store near me replaced their 2 checkouts with 5 self checkouts, and has one person nearby to help/monitor.

Re: The economics of dollar stores

#159

Post by chillwaves »

grae_QED wrote: post #148
hn_throwaway_99 wrote: post #101

So if I can summarize the article, the economics of dollar stores are "sell things for more than it cost to buy them". I mean, it seemed like the article wanted to have some nefarious take, but offering smaller quantities of items so people can afford them, even if the per-unit cost is higher, doesn't seem like some unexpected malicious intent. I mean, I certainly expect to pay more per gram if I'm buying a travel si…

[flagged]

Even rich people shop at Walmart.

Re: The economics of dollar stores

#160

Post by astura »

dopidopHN wrote: post #11
kcorbitt wrote: post #2

I absolutely love dollar stores. I recently needed to buy a set of crayons for my son and the options were $5 on Amazon, $4 at Target or $1 at the local Dollar Tree (and the pack had 36 crayons, vs 24 from the other sources!). They're not the right place for everything, but for kids' art supplies, cleaning products, party paraphernalia, seasonal decor, etc, they can't be beat. They seem to have a pretty strong stigma…

Your whole country is exotic to me, and I formed my opinion on things as a old adult. For me dollars store are the reliable place to buy toxic stuff, cleaning supplies and in general non-food item. I like that it’s small and to the point. The food there make me sad, though. It’s almost exclusively crap.

My local Dollar Tree has excellent food - sure, no fresh vegetables but there are staples plus name brands that costs 2x-5x at the local grocery stores and other stuff that's not even available at other stores (specifics off the top of my head - Zapp's Voodoo Heat chips, I've never seen them anywhere else besides the dollar store).

Obviously the stock is somewhat inconsistent.

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