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Family Dollar to close almost 1,000 stores

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Re: Family Dollar to close almost 1,000 stores

#81

Post by bombcar »

Mistletoe wrote: post #32
abnry wrote: post #16

Earlier quoted context omitted.

> The thing I don't like about these stores is IMO they take advantage of poor people who think they are getting cheaper products This only makes sense if you think poor people are dumb or naive. They don't know how to compare prices? As other people have mentioned, sometimes the value is the amount you can buy. If your personal financial margins are small, it is okay to spend more per oz on a single bar of soap beca…

I do know a lot of poor people and they are actually extremely financially dumb and naive. They do not know how to compare prices per unit of measure. They do think the dollar store is cheap. They did have a goal of not using DoorDash for a month because their addiction is so bad. They will DoorDash fast food because they are too lazy to go pick it up.

I've known poor people (heck I have been - and compared to some here no doubt still are - poor people). The ones who are not dumb, end up being not poor eventually, even if not rich.

Re: Family Dollar to close almost 1,000 stores

#82

Post by bombcar »

kerkeslager wrote: post #60
al_borland wrote: post #9

Earlier quoted context omitted.

Historically, dollar stores do better during bad times. I’m wondering if Dollar General is what’s really hurting them. I hear people talk about Dollar General all the time, but almost never Family Dollar. DG seems to be the Walmart of the dollar store game.

Due to rock climbing, I spend a lot of time in poor rural areas (most recently, rural Tennessee). Dollar General has a few things going for them in these areas: 1. They seem to have very low staffing costs. Most stores seem to have at most 2 workers on staff at a given time (obviously this is higher in busier areas). 2. They seem to have no compunction about putting stores in pretty remote locations (example: [1]). T…

Everything here is spot on with my experience. They also have little or no perishable items and so stocking becomes simpler, too.

Re: Family Dollar to close almost 1,000 stores

#83

Post by margalabargala »

lotsofpulp wrote: post #52
babypuncher wrote: post #17

Earlier quoted context omitted.

These places create food deserts, for the reason you mention. They are engineered to get poorer people to come there instead of a normal grocery store. The grocery store in your neighborhood struggles and closes, now you have to drive twice as far to get fresh produce, or go to Family Dollar and buy a week's worth of frozen Banquet meals. That can't be healthy for any population. I avoid these stores on principle now…

I would have thought a certain portion of the population becoming poor enough to want to shop at a cheaper store for lower quality products is what causes a store selling at higher quality products at higher prices to go out of business. Edit to reply to post below due to posting limit: The people choosing to shop at the cheaper store are also benefiting, otherwise, they would not have switched from shopping at the h…

To address your edit:

> The people choosing to shop at the cheaper store are also benefiting, otherwise, they would not have switched from shopping at the higher priced store.

The strategy is as follows:

- Move into small town that can only support one store.

- Undercut existing store, using corporate resources to stay afloat while doing so.

- When other store closes, raise prices.

- Enjoy your monopoly position that's near-impossible to disrupt due to town not being able to support two stores.

Yes, you are correct that some consumers briefly spend a couple of months benefiting from lower prices during step two. The raised prices in the years following make up for that, not to mention the decrease in quality and variety, and the destruction of the town's local businesses, speeding the demise of the town.

Re: Family Dollar to close almost 1,000 stores

#84

Post by lotsofpulp »

margalabargala wrote: post #83
lotsofpulp wrote: post #52

Earlier quoted context omitted.

I would have thought a certain portion of the population becoming poor enough to want to shop at a cheaper store for lower quality products is what causes a store selling at higher quality products at higher prices to go out of business. Edit to reply to post below due to posting limit: The people choosing to shop at the cheaper store are also benefiting, otherwise, they would not have switched from shopping at the h…

To address your edit: > The people choosing to shop at the cheaper store are also benefiting, otherwise, they would not have switched from shopping at the higher priced store. The strategy is as follows: - Move into small town that can only support one store. - Undercut existing store, using corporate resources to stay afloat while doing so. - When other store closes, raise prices. - Enjoy your monopoly position that…

Once the new store raises prices, why can another cheaper store not come in and do the cycle over again?

My contention is the cheaper store’s success is not the root cause, the cheaper store’s success is the symptom of a sufficient portion of the local populace losing purchasing power.

Re: Family Dollar to close almost 1,000 stores

#85

Post by lotsofpulp »

pers0n wrote: post #5

I hope Aldi gets 1,000 stores soon. Ideally I'd like to see 5,000+ Aldis in the US.

You should try Winco if you like Aldi. Has everything a grocery store does, but at Aldi prices. Doesn’t even take credit cards (in store), like Aldi used to prohibit.

Re: Family Dollar to close almost 1,000 stores

#86

Post by margalabargala »

lotsofpulp wrote: post #84
margalabargala wrote: post #83

Earlier quoted context omitted.

To address your edit: > The people choosing to shop at the cheaper store are also benefiting, otherwise, they would not have switched from shopping at the higher priced store. The strategy is as follows: - Move into small town that can only support one store. - Undercut existing store, using corporate resources to stay afloat while doing so. - When other store closes, raise prices. - Enjoy your monopoly position that…

Once the new store raises prices, why can another cheaper store not come in and do the cycle over again? My contention is the cheaper store’s success is not the root cause, the cheaper store’s success is the symptom of a sufficient portion of the local populace losing purchasing power.

> Once the new store raises prices, why can another cheaper store not come in and do the cycle over again?

Well, then the first dollar store can lower prices to prevent that. Doing this requires a large war chest. The store needs to take a loss for months to years until its competitor dies.

A Dollar Tree or a Dollar General can do this easily against a locally owned store. But once a Dollar Tree has moved in, a Dollar General won't, because both companies have the resources to back an individual store indefinitely, and neither will make any profit. So there's no use. Having one corporate-owned dollar store in a small town is a very stable minimum.

> My contention is the cheaper store’s success is not the root cause, the cheaper store’s success is the symptom of a sufficient portion of the local populace losing purchasing power.

Completely disagree. The cheaper store's success is a symptom of abuse of the market by a larger company. In places without discount stores, people get along just fine, and in fact protest against the opening of such stores in their town. These stores don't open stores in places where "the local populace has already lost purchasing power" and are seeking somewhere new to buy things, they open stores in places where they can create and enjoy a monopoly position due to the relatively small size of the local population.

This isn't something you'd see in an urban area. But there are countless examples of this happening across Eastern Oregon or Nevada.

Re: Family Dollar to close almost 1,000 stores

#87

Post by faeriechangling »

BriggyDwiggs42 wrote: post #25
abnry wrote: post #16

Earlier quoted context omitted.

> The thing I don't like about these stores is IMO they take advantage of poor people who think they are getting cheaper products This only makes sense if you think poor people are dumb or naive. They don't know how to compare prices? As other people have mentioned, sometimes the value is the amount you can buy. If your personal financial margins are small, it is okay to spend more per oz on a single bar of soap beca…

Poor people have less time, and also worse access to good educations. Stupidity is not required. “Sometimes the value is the amount you can buy” Sure, but on a systemic level we can still see the issue, i.e. that being poor is expensive.

Price comparison is mostly basic arithmetic, combined with maybe a touch of nutritional knowledge. Hardly something you couldn’t master with a middle school education.

A poor person might not be that clever and might not have much time and might make a bad decision the first time they visit family dollar and get conned by watered down soap and subpar goods and food in unusually small portions. However when they shop there for YEARS they do eventually find the time to figure out what the deals are. When these stores have tons of poor people being loyal customers for years it indicates they’re doing something right.

Re: Family Dollar to close almost 1,000 stores

#88

Post by faeriechangling »

Mistletoe wrote: post #32
abnry wrote: post #16

Earlier quoted context omitted.

> The thing I don't like about these stores is IMO they take advantage of poor people who think they are getting cheaper products This only makes sense if you think poor people are dumb or naive. They don't know how to compare prices? As other people have mentioned, sometimes the value is the amount you can buy. If your personal financial margins are small, it is okay to spend more per oz on a single bar of soap beca…

I do know a lot of poor people and they are actually extremely financially dumb and naive. They do not know how to compare prices per unit of measure. They do think the dollar store is cheap. They did have a goal of not using DoorDash for a month because their addiction is so bad. They will DoorDash fast food because they are too lazy to go pick it up.

DoorDash has more value when you’re poor because you are less mobile, and more generally are less likely to have a well outfitted kitchen, and I see a lot of younger people who are inexperienced cooks using it.

It’s no secret that it’s a terribly fast way to burn cash but a downward spiral of depression from being poor -> ordering food because you’re too depressed to cook -> depression from being poor can occur. Mind that I’d advise such people hoard frozen dinners and save a whack of cash, it isn’t quite the same.

I honestly think that poor people can even UNDERESTIMATE how valuable debt-fueled DoorDash and Uber usage is if they expect upwards economic mobility in the near future (Students) since it’s one of the better time/money tradeoffs they can do.

Re: Family Dollar to close almost 1,000 stores

#89

Post by xtiansimon »

darth_avocado wrote: post #19
prirun wrote: post #7

When they were competitors, before the merger in 2015, they built stores next to each other. Rite Aid did the same thing with Walgreens drug stores. Then after the merger, they ended up with redundant stores in the same location. Duh! https://corporate.dollartree.com/news-media/press-releases/d... The thing I don't like about these stores is IMO they take advantage of poor people who think they are getting cheaper pr…

The misconception about dollar stores is that they sell cheaper products. However it’d be cheaper to buy almost anything per unit at Costco. Dollar stores provide a service when they sell the same products but smaller sizes, which makes it easier for people who don’t have enough cash to buy stuff.

“…easier for people who don’t have enough cash to buy stuff”

Or storage space, or Costco membership, or personal transportation

Re: Family Dollar to close almost 1,000 stores

#90

Post by babypuncher »

lotsofpulp wrote: post #84
margalabargala wrote: post #83

Earlier quoted context omitted.

To address your edit: > The people choosing to shop at the cheaper store are also benefiting, otherwise, they would not have switched from shopping at the higher priced store. The strategy is as follows: - Move into small town that can only support one store. - Undercut existing store, using corporate resources to stay afloat while doing so. - When other store closes, raise prices. - Enjoy your monopoly position that…

Once the new store raises prices, why can another cheaper store not come in and do the cycle over again? My contention is the cheaper store’s success is not the root cause, the cheaper store’s success is the symptom of a sufficient portion of the local populace losing purchasing power.

It's hard to push into an existing market already controlled by a corporation worth billions. They have so much money in the bank that they can win any war of attrition. So nobody ever really tries.
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