As grocer prices rise, a new report shows that more shoppers are flocking to dollar stores to save money. But according to a separate new report – they shouldn’t. The price of personal items in dollar stores may be lower, but overall, prices in dollar stores are rising faster than anywhere else.
This is according to a new pricing survey by market research firm Numarator. “All major in-store channels have experienced gross price increases over the past 12 months,” the report found. But “rising prices are disproportionately affecting the dollar channel” because “dollar stores have shown the greatest increase in grocery prices in all types of stores”.
At this point compared to last year, the numbers show that the grocery price of dollar stores has increased by 14.3%. Prices at club stores like Costco are the lowest, rising 6%. These include traditional supermarkets, mass retailers like Walmart, and online grocers.
The percentages became clearer than prices two years ago. Dollar store grocery prices have risen 22.5% since this time in 2020, the highest growth rate among all types of stores.
Yet more and more people are shopping in dollar stores which can be a misleading attempt to save money. Location analysis company Placer.ai found that as of December 2021, Dollar General, Family Dollar and Dollar Tree saw 28.2%, 20.4% and 13.7% more visits, compared to December 2019, respectively.
Walmart, the largest and most popular discounter, grew 0.3% over the same period, “not as impressive as the double-digit increase in visits for some of its competitors,” reports Placer.ai. But more Walmart shoppers are now shopping in dollar stores – as of December 2021, 23.4% of Walmart shoppers are also shopping in Dollar General. “This indicates that at least some of the discount retailers’ energy is coming at Walmart’s expense,” the report found.
But are buyers really saving money by turning to dollar stores, if prices are rising faster elsewhere? The survey of numbers does not indicate whether the recent move to raise the base price of the dollar tree from $ 1 to 25 1.25 has resulted in skewed results – an immediate, one-time 25% price increase that could look worse than the overall dollar store segment results.
Still, dollar stores have never been the best way to save money if you focus on unit costs. You can save more by buying in bulk or waiting for a grocery store to sell. But low-income shoppers don’t always have that luxury – they often have to spend cash for the least expensive items, even if they cost them more in the long run. As a result, the numbers show that low-income consumers are “most affected by inflation compared to other income groups,” paying 12.8% more for groceries than a year ago, 11.4% for middle-income earners and 11.1% for higher-income earners. – Income consumer.
But it never fails – anytime the economy turns bad, dollar store sales turn good. Dollar General CEO Todd Vasos once said, “We do very well in good times and we do great in bad times.”
These recent results, however, show that what is good for dollar stores is not necessarily good for dollar store shoppers. So if you are a fan of dollar stores, you also like to shop for the best deals – you may want to start looking for deals elsewhere.
Photo source: Family dollars