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The Dollar Store Backlash Has Begun (citylab.com)
The U.S. has added 10,000 of these budget retail outlets since 2001. But some towns and cities are trying to push back. From a report: A recent research brief [PDF] by the Institute of Local Self Reliance (ILSR), a nonprofit supporting local economies, sheds light on the massive growth of this budget enterprise. Since 2001, outlets of Dollar General and Dollar Tree (which bought Family Dollar in 2015) have grown from 20,000 to 30,000 in number. Though these "small-box" retailers carry only a limited stock of prepared foods, they're now feeding more people than grocery chains like Whole Foods, which has around 400-plus outlets in the country. In fact, the number of dollar-store outlets nationwide exceeds that of Walmart and McDonalds put together -- and they're still growing at a breakneck pace. That, ILSR says, is bad news. "While dollar stores sometimes fill a need in cash-strapped communities, growing evidence suggests these stores are not merely a byproduct of economic distress," the authors of the brief write. "They're a cause of it."
Dollar stores have succeeded in part by capitalizing on a series of powerful economic and social forces -- white flight, the recent recession, the so-called "retail apocalypse" -- all of which have opened up gaping holes in food access. But while dollar store might not be causing these inequalities per se, they appear to be perpetuating them. The savings they claim to offer shoppers in the communities they move to makes them, in some ways, a little poorer. Using code made public by Jerry Shannon, a geographer at University of Georgia, CityLab made a map showing the spread of dollar stores since the recession.
Dollar stores have succeeded in part by capitalizing on a series of powerful economic and social forces -- white flight, the recent recession, the so-called "retail apocalypse" -- all of which have opened up gaping holes in food access. But while dollar store might not be causing these inequalities per se, they appear to be perpetuating them. The savings they claim to offer shoppers in the communities they move to makes them, in some ways, a little poorer. Using code made public by Jerry Shannon, a geographer at University of Georgia, CityLab made a map showing the spread of dollar stores since the recession.
Comparing dollar stores to Whole Foods is a joke, not only because they have nearly 2 orders of magnitude less stores but Whole Foods has ridiculous prices in comparison. The notion that they're making communities worse off is mostly absurd. The small part that it's not is that other grocery stores with more reasonable prices do exist and provide an even better value, even if they often require more effort to access. The problem is, that truth is pretty much wholly true only so long as people spend their money wisely in those other grocery stores or any potential savings will be lost.
But, yes, please continue this rant against dollar stores.
The end of the article has a statement from one of the researchers bemoaning the fact that the Kroger's in her neighborhood, which is primarily fixed income and suffered a 50% foreclosure rate during the last housing crises doesn't stock more expensive foods, "The one in a whiter, more affluent neighborhood regularly advertises grains, nuts, seafood, olives, and wine." Uh, the Kroger's in your neighborhood doesn't advertise it because they won't sell and, surprisingly, stores tend not to stock things that don't sell. That's not The Dollar Stores fault, that's caused by a raft of other issues (racism, predatory payday loan stores, the list is lengthy) but denying access to low cost goods in the hopes that the Kroger's that 15 minutes closer to you will start stocking things that the neighborhood can't afford is asinine.
Grocery stores closed in a lot of poor neighborhoods during the recession, bringing down property values even further, and Dollar Stores moved in to fill the gaps. The presence of the Dollar Stores in those neighborhoods are now keeping out the traditional grocery stores, preventing those neighborhoods from recovering fully. The Dollar Stores are are nutritional deserts, and not really cheaper than grocery stores, so this is a losing situation all around.
(Posting this because I was curious, and annoyed that I was forced to skim the actual article. Skim! Outrage.)
I live in a rural area, and in places like this the dollar stores are built to fill in the gaps between the Walmarts. They are geographically dispersed roughly every 10-15 miles where there is any kind of "populated area". Here, at least, where it is rural, they are providing a needed service.
Walmarts and the big gas stations along the interstates have killed off most of the independent gas stations and country stores that used to serve the small (1000 people) populated areas. You used to go to these stores for the basic stuff - bread, milk, candy bars, snack stuff. Most also had a small variety of hardware, fishing and hunting related stuff, and sometimes a small deli or grill. These are pretty much all gone. They used to be along state routes every several miles, and they enjoyed enough traffic to do well. The interstates took a great deal of volume (especially through traffic) off those roads and condensed them into major arteries. Those arteries have extremely limited points of access, and the land at each exit is so incredibly expensive that only huge chains can afford to have a business presence there.
So, most of these small stores have gone out of business. Now if you needed to run to the store because your propane lighter ran out of fuel and you couldn't light your grill, or the kids were pestering for batteries for their game controller, you had to travel 25-30 minutes to the regional Walmart. Dollar stores are filling those empty holes. They didn't cause them (well, certainly they have run some mom and pop places out of business, but the majority of the damage was already done a decade or more ago). Around here in the boonies, it's a welcome sight having a store like this within a few minutes of home.
In this area, they have popped up in the very rural country areas in the last 2-3 years. The local stores went out of business well before that.
Better known as 318230.
I live in remote rural Appalachia. The last couple of years have seen an influx of Dollar General stores al over the region. They have opened in isolated communities that had NOTHING. Not even a place to buy a coke or a pack of gum. At Dollar General you can buy household supplies, clothes, food, all sorts of things that make life easier, far easier than driving 50 miles to a Walmart.
This article is myopic and is only concerned with ghetto people who might live 5 miles from a decent grocery store. Try living 50 miles from one and see if Dollar General is a problem. To folks around here it is welcome and improves quality of life.
Listen - cheap goods aren't a magic bullet cause of economic stress.
If I made a farming robot that grew a variety of high quality food for $0.05 a kilogram, and sold it to people for $0.07 a kilogram, it would mean that a lot of folks would be spending less money - and I might even put some types of business out of a market niche - but that does NOT have to cause mass poverty.
Rather, it causes a limited market failure. Market failures are where the ideals of 'free markets' break down - because they tend to happen when there isn't any room for incentives left.
I'd say this is ideally where the basic role of government lies. Government in this case meaning a group of people that decides common shared action for their mutual shared benefit.
When goods are too cheap for markets to pay people a living wage to have them on market - that makes it a perfect role for a government to play, to literally share the burden of, for instance, making sure that no one starves from neglect, or is unable to live productive lives for not benefiting a company enough.
Those flaws are 'externalities' to a corporate mindset, but the whole reason we work together as human beings outside that mindset.
Being able to produce practically endless amounts of good quality cheap food is a legitimate cause for real celebration - I don't find the argument that because it can also cause limited market failure to be a flaw.
Back in time, corporations were things that often existed for a limited time to serve a common community need, which were then dissolved when that need was met - it's why we still have corporate charters on them.. I think that may have been a healthier way to view that balance.
I mean, we've been taxing folks to keep farms alive for generations now - it's a legitimate logical problem letting market forces eliminate our agricultural infrastructure. Basically every part of society still has some aspects of it that supersede some market ideal - no matter how capitalist we idealize ourselves to be.
Ryan Fenton
I live in a small town that was absent a real grocery store for years. We had both a Family Dollar and a Dollar General though.
Guess what? Grocery stores weren't deciding not to come here because those dollar stores were too difficult to compete with!
It was simply a matter of analyzing the economics. Our population is only around 6,000 -- and you don't add more than a few thousand others if you add the next town over from us, along with people on the other side of the river, who live in another small town, in another state.
We finally DID get a full size grocery store here, but only because it was part of a long-term plan for a planned community of new homes that have been getting built on the outer edge of town for 5 years or so. They waited out the economic depression before constructing it, but decided it was feasible to do now.
Both dollar stores are doing about as much business as ever, BTW. They're simply the cheaper places to go for your toiletries and household items. Plus, they're more flexible in adjusting their inventory to the local community's needs. Family Dollar, out here, turns into a pretty respectable toy store around Christmastime, and then scales that back afterwards. They'll turn into a one-stop shop for your basic gardening and outdoor BBQ needs when the weather gets nicer. They NEVER claimed to be a place to buy your fresh foods though. They're just convenient for the non-perishables like you might grab to put in your kid's school lunch, or when you need something in a pinch.
I've seen these rants before about "food deserts" and the usual insinuation that racism and "white privilege" has something to do with it. Sorry, but no.... This stuff happens when either A) you live in a more rural or smaller town and the total population isn't enough for the grocery chains to cost-justify coming in, or B) you live in a high crime neighborhood that runs out the large grocers because of all the extra burdens it places on them. (I used to live in one of those areas too, and things like the requirement to hire armed security guards to patrol the parking lot and entrance, plus the fact the crime scared a lot of people off from trying to shop there in the first place, made it unsustainable for them.)