After a couple of levels of indirection, I think the whole argument hinges on one anecdote. It might indicate a general pattern, but no actual authoritative sources back it up.

Original Article quotes

"growing evidence suggests these stores are not merely a byproduct of economic distress. They’re a cause of it. In small towns and urban neighborhoods alike, dollar stores are triggering the closure of grocery stores, eliminating jobs, and further eroding the prospects of the vulnerable communities they target"

This links to a report here as a source: https://ilsr.org/dollar-stores-factsheet/

Which cites https://www.theguardian.com/business/2018/aug/13/dollar-gene... as its only source.

The actual quote:

"“We lasted three years and three days after Dollar General opened,” he said. “Sales dropped and just kept dropping. We averaged 225 customers a day before and immediately dropped to about 175. A year ago we were down to 125 a day. Basically we lost 35 to 40% of our sales. I lost a thousand dollars a day in sales in three years.”"

It's always odd to me to throw Dollar General into the same category as Dollar Tree.

Dollar Tree is an actual "dollar store" where literally every item costs $1. Dollar Tree's items are generally no-name discount brands that wouldn't be found in big grocery store chains, or familiar brands in unique very small packages.

Dollar General, at least in the two parts of the US I've seen them in (areas of California and the Midwest), is as you describe: something between a convenience store and a traditional grocery store sans produce. They have all the normal big brands: Oreos, Doritos, etc. in the normal package sizes at what seemed to me to be normal grocery store prices.

I don't think Dollar General is the bad guy so much as a symptom of a problem. As it is, they're often in low income areas and have a high markup. Grocery stores have low margins that prevent them from entering these markets (hence food deserts). Dollar General fills that niche - but as a result low income people who already spend a disproportionate amount of their income on groceries have to pay that higher markup as well. Meanwhile I can go to Trader Joe's or something and get much better stuff, cheaper too.

I remember living in a rural area where people couldn't afford a car, but could walk to a gas station and pay 3x the prices on everything compared to if they bought everything at grocery store - it just helps keep them poor. And often, I think people see "dollar" in the name, and think that automatically means cheap, but being poor doesn't mean being financially literate.

If people weren't segregated into rich areas | poor areas, or maybe grocery stores found some other way to be profitable in low income areas, or some other thing, this wouldn't be such a problem. But as it is right now, they are filling a need, granted with negative side effects.

Edit: I realize the article focuses more on Dollar Generals causing food desserts, rather than being a response to them. Guess I'm focusing on more what I've seen.

The problem as I understand it is that products aren’t priced in a grocery store to all have the same margin.

So the prepared foods and toiletries get marked up to make up for low margins on fresh fruit. Wealthier customers are fine with this as they want to not have to make two trips and they will pay for the fruit.

Dollar stores ditch the fresh stuff and just take a lower margin on the toiletries and prepared food to make up for it, resulting in lower prices. A bit of extra savings matters more to poor people, so they shift those purchases to the dollar store. The grocery store’s business model fails.

When dollar stores replace grocery stores in a community it reduces the quality of nutrition available. Potential vicious cycle there. Economic downturn --> worse nutrition -> decline in mental and physical health of community -> more downturn

The real issue is that all value created by the likes of Dollar General leaves the community. If the owner of the store is in the community, those dollars will more likely be spent withing the community. The increased tax value on the owner's home will be in the community. With Dollar General, all of that leaves.

Nobody in a Dolllar General is making much more than the proprietors of the old local store were making. Yet, their prices are cheaper. Why? Because Dollar General is taking a cut.

This may seem better to the local community at first (lower prices means more money in their pockets) yet this money is leaving the community forever. With the local grocery store, money flowed in circles, now Dollar General is extracting what value is in the community until the community dies.

I think the problem, as the article states, is the “bifurcation” of the economy. Politicians talk about this as the erosion of the middle or working class.

Wage stagnation is very real and inflation, which remained somewhat muted is now also very real. The average cost of a new vehicle in the US is now over $40,000. That is almost double what it was 20 years ago. The cost of groceries, anecdotally, is almost double what it was 10 years ago where I live. And yet, wages have increased only moderately.

There is nothing wrong with Dollar stores. They serve an important niche. Most everyone has probably shopped at one. The problem is that this is the primary market demand. Dollar stores are many things, but “nice” or “pleasant” are not words used to describe them. People aren’t usually shopping at dollar stores as a first choice. People are shopping at dollar stores as an only or last choice.

More dollar stores means that these chains are seeing increased demand for their retail niche, which could be interpreted as a leading edge economic indicator that families are getting poorer.

When you see a dollar store, odds are that:

- it is newly built. Building a dollar store is a fairly cheap way to raise the value of undeveloped land so some land owners use them as an exit strategy for declining communities.

- likely in an odd location, compared to other stores. The developers asked an inexperienced city council to rezone non-commercial land to approve the new build.

Dollar stores wouldn't be as much of an issue if they leased existing commercial space but this rarely happens.

Sub-optimal land usage can lower the chances of a depressed community from ever rebounding.

They are often criminally understaffed, and get away with lower prices as a result. Added to that their shear size, they are able to purchase in bulk cheaper. Which shuts down locally run things, because they can't compete without breaking the law in turn with somehow more abhorrent labor practices.

There was recently a video about a lady who worked at Dollar Tree for just a short time before quitting. I posted a link below, but it's kinda long so I'll summarize. She basically wasn't allowed to take breaks, and had to find her manager to ask permission to get a drink of water. In Florida heat. It was pretty heartbreaking.

https://youtu.be/Jkfjlo3VFcs

One weird thing I've noticed about Dollar General is that they seem to get special versions of many products. Like sizes of food items/containers that I've never seen anywhere else.

I wonder if there are other differences in what they're shipped. Like how "outlet stores" get shittier versions of brand-name clothes.

>They don't have a produce section, just a bit of fruit. Is that the issue?

42% of the united states is overweight. nearly 20% of children are obese. dollar stores could be seen to directly undermine US health policy by displacing larger grocery stores and encouraging unhealthy consumption of overprocessed foods high in sugar salt and fat. "filling a niche" is an idea the marketing department came up with to justify selling garbage.

the lack of access to food (food deserts) and a healthy balanced diet are direct contributors to obesity and its myriad of comorbidities. They disproportionately affect people of colour and low income communities, and have been correlated with income inequality and the wealth gap across racial boundaries as well.

unpopular opinion: the "wealthy" version of the dollar store is Trader Joes in that both cater to the american "idea" of cooking food moreso than actually preparing a meal. Both rely on processed and frozen offerings of sugar salt and fat that present a reconstituted/reheated 'cooking' experience as opposed to actual cookery involving fresh ingredients and thoughtful planning. many people have a favourite product at these places, but few people can conceive of a favourite recipe they assemble from ingredients sourced at either.

I haven't looked at this enough to have a strong opinion on dollar stores in general, but it strikes me that the 20% of grocery products they don't stock (ie. produce) are the things that most people consume too little of.

I have the same experience with dollar generals, they tend to go in places where the only "competition" was driving further. And their prices tend to me pretty good, it's almost like a mini Walmart.

Putting "dollar" in the name makes everyone think of the dollar trees (everything $1), so I guess the author wants this to be a bit of a commentary on how this is catering to the poor possibly? But the other chains are essentially just well stocked stores. Who doesn't want to shop somewhere that's both convenient and cheap?

> They don't have a produce section, just a bit of fruit. Is that the issue?

Yes, it is as produce is a group of products that a better margin than produce (and produce spoils easier). By comming into an market and serving produce any other store is put at an disadvantage if they sell produce. This leads to "food deserts", places where you can not find healthy, affordable food.

> Are the small independent grocery stores in these communities stocking produce?

If there are any, they are worried. If you have 7 minutes this video by VICE from 2018 explains some of the concerns. https://www.youtube.com/watch?v=N6IqsG-Iiik There are also community actions against dollar stores such as here https://www.youtube.com/watch?v=-vLWTkBQWP0 This CBS reports about grocers being closed due dollar stores moving into towns https://www.youtube.com/watch?v=GtAvJBAJfnE drawing parallels to Walmart killing mainstreets

> Is Dollar General and the like creating some kind of price cartel that's putting them out of business?

By serving only non produce goods a competing store which previously was able to carry produce and was able to bear this expense due non-produce sales will see reduced non-produce sales leading to worse financial performance and possibly clousure or a slow death while loosing customer to dollar general.

> previously only had a gas station convenience store and people had to drive 12 miles

This is an improvement for those people, good.

These stores sell cheap junk most people will not buy if they gave the option of buying better stuff, so they're often considered a sign of blight, much like payday lenders. Besides that, the article seems to contend that they are driving businesses like grocers out of business, I would guess by undercutting them on high-margin items.

I thought the whole point of complaining about dollar stores was to mask concern for your property values and callousness to the impoverished as compassion. It struck me as more dog-whistle than any coherent non-cynical logic. "We don't want to get rid of the poor, just cheap stores. To help them!"

I see these springing up in economically depressed areas--that and those check-cashing and payday loan businesses.