The Troubling Reality Behind Dollar General’s Domination

If you live in a small, rural community or even in certain sections of major U.S. cities, chances are your closest retailer is Dollar General. Along with other dollar store chains, this brand has been able to stake a claim in places where other stores wouldn’t be able to survive.

But how has it carved out this niche and what does it mean for those living in these areas?

It’s all about the budget

While Walmart can serve areas with relatively sparse populations, it requires thousands of local shoppers to maintain a profit. Dollar General, on the other hand, can thrive in areas with just a few hundred residents.

With just two or three employees working per shift, the company can pay as little as $300-$400 per day on staffing expenses. It might pay about the same amount per day on rent in remote areas where rates are lower.

A sub-$1,000 daily overhead expense makes it possible to bring in a profit even when there aren’t that many customers.

The real hook, however, is the lack of competition — and that can have a very serious downside.

No other options available

Whereas Walmart stocks about 140,000 unique products in each store, Dollar General only has about 10,000. This means fewer options in each category.

And since many of the chain’s shoppers are strapped for cash, they often spend less upfront on a product but end up spending more over the long term.

Worse yet, the arrival of Dollar General can put small supermarkets out of business. That means no fresh produce and other healthy options.

These stores can fill an important gap in areas without grocery stores, but they can also keep people in poverty and diminish the overall health of entire communities.

Chris Agee October 10th, 2023

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