CNN reports on a new study from Coresight Research suggesting that Dollar General, Dollar Tree and Family Dollar together will account for 45 percent of all large retail store openings this year.
It is, the story says, a "reflection of the dollar store sector's outsized growth in the retail industry as other chains close shops or stop building new ones … These openings are a continuation of dollar stores' rapid growth even before the pandemic."
According to CNN, "Economists and retail analysts say dollar stores are expanding in part because of growing wealth inequality in the United States and the hollowing out of the middle class. The share of American adults who live in middle-income households decreased from 61% in 1971 to 51% in 2019, according to Pew Research Center."
- KC's View:
Yikes. That's an amazing percentage, and it reinforces something we've talked a lot about here on MNB - that the physical domination of the dollar store format in this country has the potential to be a major issue for many middle-of-the-road retailers going forward. If all you are doing is depending on price as a differentiator, then dollar stores have the potential to be a major disruptor.
It also is important to think of all this building as laying the foundation for a time when the economy goes south, in communities that feel the pain more than others.