Food Policy

Are Dollar Stores Really Driving Grocers Out of Business?

Dollar stores are the latest target of advocates who want to improve food offerings by limiting them

|

JIM YOUNG/REUTERS/Newscom

Earlier this month, the Institute for Local Self-Reliance (ILSR), a nonprofit advocacy group with offices in Minneapolis, Maine, and Washington, D.C., that "challenges concentrated economic and political power, and instead champions an approach in which ownership is broadly distributed, institutions are humanly scaled, and decision-making is accountable to communities," released research meant to push back against the spread of dollar stores, which the group argues are "targeting struggling urban neighborhoods and small towns."

Generally, dollar stores are mid-sized retails stores that sell "a wide range of inexpensive household goods."

The ILSR research focuses largely on the sale of what it deems substandard groceries by dollar stores, criticizes their spread as the cause and effect of economic malaise, and urges cities and towns "to check the[] spread" of dollar stores through local legislation. Steps the ILSR urges cities and towns to take include setting limits on chains, creating buffer zones around existing stores (of the sort food trucks have often endured in many cities), increasing red tape, and subsidizing locally owned groceries.

The research makes several assumptions that don't stand up to scrutiny.

First, it argues that dollar stores are both the cause and effect of what ails grocery markets in many cities and towns. It argues dollar stores are "both a symptom of larger economic trends and a cause of additional economic despair." It's not by any means impossible for a phenomenon to serve as both cause and effect, but the respective cause and effect this research identifies—dollar stores put grocers out of business and "dollar stores concentrate in areas that already have few or no grocery stores"—seem at odds with one another.

Second, one of the main criticisms the research lobs at dollar stores is that dollar stores don't sell fresh meat or produce. They do, however, offer varying degrees of canned and/or frozen meats and produce. There's nothing innate to fresh foods that is superior to canned and frozen alternatives of the same foods. Consider, for example, that dollar stores sell frozen meats, canned vegetables, condiments, and other arguably health foods. They sell $1 steaks. Dollar Tree offers some great canned foods. One Florida State University student wrote about the "ridiculously good meals" she made during a week in which she only bought food only at the Dollar Store.

Third, it quotes Tulsa city councilor Vanessa Hall-Harper, who helped develop legislation to limit dollar stores, who says a Sav-A-Lot grocery in her district closed because of incompetence on the part of management and/or the licensee, rather than because of competition from dollar stores. That would seem to undermine the premise behind ILSR's research.

(Notably, Hall-Harper's North Tulsa district is not completely devoid of places where residents may buy fresh produce. According to a recent report on farmers markets in Tulsa, the northern part of the city is home to an urban farm and is served weekly by a roving truck that sells low-priced fresh produce.)

Fourth, it argues that a dollar store in Moville, Iowa, put a grocer there, Chet's Foods, out of business. Yet the report also notes that "residents were still buying most of their groceries from Chet's" and the store closed anyway. In an email to me this week, Stacy Mitchell, ILSR Co-Director and co-author of the research, explains that fixed costs likely doomed Chet's in the end. "As a large company, Dollar General can lose money at a new location for a much longer period (making it up elsewhere in the chain)," Mitchell also adds. That makes sense. "I think this is something libertarians don't really wrestle with. Big companies can 'win' competition not by virtue of being better or more popular, but by virtue of being larger. Is that the best outcome?"

Maybe. Maybe not. But if Chet's or any other grocer's business model rests on margins so slim it will fail in the face of any competition, that business won't be able to withstand competition from anyone—be it a dollar store, a mom-and-pop corner shop, or another grocer.

Fifth, the research details how dollar stores are now selling more food than is Whole Foods. That sounds like a startling number until you consider, as the report indicates, that the two largest dollar store chains—Dollar Tree and Dollar General—now boast nearly 30,000 total locations across the United States. Whole Foods has fewer than 500 locations across the country.

That means there are at least around 25,500 more dollar stores in this country than there are Whole Foods stores. I asked Mitchell about the comparison.

"For many people living in large prosperous metro areas on the East and West costs, Whole Foods looms large in the mental landscape of food retail," Mitchell writes. "It's very visible in the national media, for example. Few people in these areas think of dollar stores as food retailers, but the invisible reality is that the dollar chains are supplying a much larger share of America's groceries. Making the comparison to Whole Foods was a way to get people's attention. Increasingly we live in two different Americas and our media more often reflects one and not the other."

So are dollar stores preying on people? Or are they serving them?

Prof. Elizabeth Racine, professor of public health at the University of North Carolina-Charlotte, studies dollar stores. She was initially opposed to the stores. "I've come around," she told Bloomberg Businessweek last year. "I appreciate that they are willing to operate in low-income places because so many other stores aren't willing to go there." Racince, the piece notes, "calls [dollar stores] the Whole Foods of Charlotte's food deserts."

"They see a need and are aggressively racing to meet that need for low-cost goods in places that are food deserts," says Garrick Brown, director of retail research with realtor Cushman & Wakefield.

That's not all. If dollar stores are taking advantage of people with little income, they're also taking advantage of shoppers who are just looking for a deal. As Greg Beato noted in 2011, Dollar General's growth has been driven in part by households earning over $70,000 per year.

Placed in a larger context, dollar stores are just the latest target of advocates who want to improve food offerings by limiting them. Plans to restrict food sellers in this way, or promote healthy food in that way, seem perpetually in motion. These efforts also seem, as a general rule, destined to fall far short of their goals. Several years back, for example, the Los Angeles City Council banned the construction of new fast food restaurants in South Los Angeles, in a move intended to combat obesity. As I've detailed, most recently in 2015, research by the RAND Corporation condemned the ban as ineffective and counterproductive.

Several years ago, Minneapolis attempted to mandate that convenience stores provide fresh produce. I criticized the plan, predicting it would backfire or fall short. And that's exactly what happened.

None of this means dollar stores should be immune to criticism. For one, they neither need nor deserve so much as one dollar of taxpayer-funded subsidies. But neither should local grocers be subsidized this way, something the ILSR research urges.

There is nothing inherently wrong with celebrating and promoting local self-reliance. But there is also nothing inherently wrong with dollar stores. Restricting them is a mistake. Might Tulsa lawmakers better serve the city by allowing residents to be truly self-reliant, rather than—as I detail in my recent book Biting the Hands that Feed Us: How Fewer, Smarter Laws Would Make Our Food System More Sustainable—ripping up a North Tulsa woman's front-yard edible garden?

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

138 responses to “Are Dollar Stores Really Driving Grocers Out of Business?

  1. It was always my dream… my dream of… sniff… running a grocery store… forever.

    And then the Dollar General came to town. And ruined it!

    What am I going to do with my life now?

    WHAT AM I GOING TO DO?

    1. Simple. Found an institute that

      “challenges concentrated economic and political power, and instead champions an approach in which ownership is broadly distributed, institutions are humanly scaled, and decision-making is accountable to communities,”

      and the grant dollars will come rolling in.

      1. Grant $, yeah, right up until you figure out where the “concentrated economic and political power” is worst, and start looking at the government.

        I really don’t understand people who are all O.M.G. about big corporations, and can’t see that government is the biggest corporation.

    2. Open a dollar store?

    3. Why don’t you think about that tomorrow?
      After all, tomorrow is another day.

  2. Thank man, I just bought a 26 pound turkey for One Dollar at the dollar store.

    1. Eww. I was coming to say I would never buy meat or produce at a dollar general. Most of them I have seen are cluttered and filthy.

      All the rest is a consumerism wet dream. Crap that breaks obnoxiously fast and deserves trashing.

      Hate these stores. I only go for pool noodles.

      1. Cool story.

      2. I’ve never seen a store of a national chain ‘cluttered and filthy’ (well, other than KFC).

        I’ve seen lot’s of mom-and-pop one-store operations that way.

      3. CLM1277: Well, if you hate them, don’t go. I hate JC Penney and I solve the problem by not patronizing them. I WON’T solve the problem the way the fascist left wants to, that is, run them out of town. Hillary would have probably been a big fan of closing down dollar stores, not because she knows what they are, or really cares (Hillary has never cared about anyone but herself in her life!), but because leftists don’t like them. No store is, or should be, forced to sell what the government wants them to. Instead, stores sell that which they believe they will make a profit on, DUH!!!! Additionally, no store is legally or morally bound to sell or offer ANYTHING at a price not of their choosing.

    2. It’s where I go to get my weird junk food others places don’t sell. Shasta Soda still exists in their hallowed halls, as do Necco Wafers and Red Hot Dollars.

      1. Ah, but do they sell Island Coconut Yoohoo?

        1. Yoohoo is becoming difficult to find around here aside from those 4oz. boxes

          1. It’s a rare delight. Though I have not had that coconut one.

      2. Always something interesting at the Dollar Store when it comes to food. They pick up what doesn’t sell at other stores which means it is oddball… which is exactly what I like to try out to see if it’s any good.

  3. Most of them I have seen are cluttered and filthy.

    Having only three do-everything employees on the clock at any one time and the high-turnover practice of unloading trucks directly on to the sales floor leads to not only filth and clutter but lower costs and lower prices. There’s that “trade-offs” thing that libertarians seem more able than most to intuitively grasp. You go to Publix because it’s neat and shiny and there’s tons of choices but you’re paying for that. Not the least of which is that Publix needs a large volume to operate and therefore has to be in town and Dollar General can operate on much lower volume so there’s probably one within 75 yards of your house. The time it takes you to get to the store is a cost and for poor people who might not have a car it’s a huge cost.

    1. They also serve a lot of small towns. I don’t know if a Whole Foods is ever going to survive in Oracle, AZ. But Dollar General can.

      Also, why the hell is Whole Foods is standard that they feel everything must compare. That highlights just pure classist action underlying this.

    2. My oldest daughter actually worked at a Dollar Store, and the “filth” you describe was non-existent. And even if you were right about the “filth” it would be on the outer carton, not the carton the item came in. Why oh why do people not do their homework before they publicly post false information, as you have, Jerryskids?

      1. I was quoting CLM1227. If he claims the Dollar General’s he’s familiar with are filthy and cluttered, I’m not going to accuse him of lying. Me, I do most of my shopping at the Family Dollar 2 miles from my house, or the other one 3 miles from my house or the other other one 4 miles from my house. I’m not familiar with the Dollar Generals. The FD is indeed “cluttered” because they’re moving the merchandise so fast they hardly have time to shelve it, never seen it filthy. Once a week I go into town to the “real” grocery store to stock up on meat and produce and the stuff you can’t find at the Family Dollar, but the people in the FD know me because I stop in there every single day for a gallon of milk, a loaf of bread, a can of stewed tomatoes, some Little Debbies, paper towels, garlic powder – whatever it is I just realized we’re out of or almost out of. And one of those $1 1.25 liter bottles of Coke. It’s just 5 minutes up the road and I know their stock better than half the people who work there. Cocoa powder? 6th aisle on the left, right-hand side, third shelf, about a third of the way down, just before the powdered sugar, right under the chocolate chips and the cupcake-pan liners.

        1. You eat a can of stewed tomatoes a day?

          I’m not judging, just wrapping my head around it.

      2. Why oh why do people not do check to ensure they’re replying to the correct commenter, CGN?

      3. Former Dollar General employee here. We were charged with cleaning up aisles and sweeping/mopping floors every night after closing. And we could do that with 2 or 3 people. If they’re reporting DGs are filthy, it’s because the staff is being lazy and regional management isn’t on their asses about it.

        1. Seconded. Because Dollar General Stores don’t handle unsealed meat or milk products, the ones I’ve seen smelled a *lot* better than most full-sized grocery stores…and tend to have cleaner floors.

        2. I’ve found that DGs can be crowded, but that the well-managed ones can be quite tidy.

  4. As always, ‘Oh no, people aren’t buying the things I think they should buy or making the choices I think they should make. We need to stop them from making wrong decisions.’

    Dollar stores have pluses and minuses, but the fact that large numbers of people choose to spebd their money there instead of a regular grocer is apparently not enough evidence that the pluses outweigh the minuses at their successful locations.

    1. Exactly.

      Fuck all paternalistic/maternalistic (they-eristic?) progressives and politicians.

    2. Dollar stores have pluses and minuses, but the fact that large numbers of people choose to spebd their money there instead of a regular grocer is apparently not enough evidence that the pluses outweigh the minuses at their successful locations.

      Shopping at a dollar store because one lacks the resources needed to visit a legitimate grocer regularly is not much of a choice.

      Along a similar line, perhaps it’s time for another ‘Ford sedans are better than BMW sedans’ or ‘Slim Jims are just as good as pot roast’ argument.

      Why are disaffected people so impractical and stubborn?

      1. Shopping at a dollar store because one lacks the resources needed to visit a legitimate grocer regularly is not much of a choice.

        No it is not. That’s not what’s happening though. Its people making a choice that their time is worth going there – its not like Dollar General is *more expensive* than a regular grocery store (they’re not). Hell, I’ve seen tons of people in my last job choose to walk 700 feet to my convenience store (where the prices *were* much higher) instead of 1200 to the grocery store.

      2. And Rev also missed the part in the article where a large portion of their profits, the evil thing discussed here, are taken from households making more than $70k. They aren’t poor, but instead they are making a choice of how they prefer to spend their money looking for deals.

        Also missed by Rev, is that the stores are frequently moving to underserved area that had not only no choice but also a lack of goods. The presence of a single choice is much greater than zero choice.

        Then Rev resorts to the straw man argument comparing a BMW to a Ford. Again, it isn’t a choice of I can’t afford a BMW (for purchase of new or repair and maintenance on used). The other place that argument fails is that the food offered by the dollars stores as argued here is that there isn’t a lack of healthy choices in that food.

        To summarize, you’re the stubborn asshole that is latching to any idea that attempts to corroborate your emotional reaction.

      3. Shopping at a dollar store because one lacks the resources needed to visit a legitimate grocer regularly is not much of a choice.

        Much better they go hungry, right? Better they get half as much for their money, so the poor can obtain better food from non-competitive sources?

        I love how the left are considered the saviors of the poor when they do nothing but fuck them at every turn.

        Oh, wait…what you really want is for the wealthy to pay for the poor’s food through welfare…

        Sorry, missed that angle.

      4. Why are disaffected people so impractical and stubborn?

        Because the are being disaffected with Other Peoples’ Money.

      5. I make 6 figures, and have made a religion out of shopping at Grocery Outlet, if you’re familiar with that. I’ve been meaning to check out some of the dollar stores too as a frugal friend of mine always talks up a certain one that’s nearish where I live.

        I don’t like being a mark… I like paying as little as I can for things. I often buy very expensive, high quality stuff… But I don’t need to do that for everything, and even with expensive things I like to get as good a deal as possible. You know how much fancy expensive stuff Grocery Outlet stocks? Shit tons! Brand name and organic stuff all over the place! But I buy it for half or less of what it costs at Safeway, Whole Foods, or my fancy local hippie grocery store.

        Some people are just SMART Rev., and don’t like paying more for things when they could pay less. That’s probably why I am going to die with at least a several million dollar net worth… And you’ll die a pauper.

    3. Great comment, Dalben. Sadly, there is a never silent leftist crowd in the U.S.,which pack of fools consist mainly of idiot college students who can’t so much as balance their checkbooks, but despite this they still feel they can advise and, if possible, force people to do what leftists think is better, despite their not knowing a SINGLE dollar store shopper personally. Thankfully, leftists (Hillary, Bernie, etc.) are too bloody stupid to convince the mass of INTELLIGENT folks in America that leftism is anything other than a waste of time at best, and deadly (The Great Leap Forward) and the like at worst.

    4. Another plus about Family Dollar & Dollar General: They operate stores in smaller towns where there’s not enough of a customer base to support a Walmart or even a smaller-footprint chain grocer. And there’s a lot of items available to customers that would save them a half-hour trip to the nearest Walmart. This article didn’t mention exactly how much of the quintuple-digit store count was rural.

      1. Yup. Many a business have made outright rural or small towns their main market, specifically because a Walmart or even a Safeway can’t always survive in such an area.

      2. There’s serious competition wherever the selection overlaps. I regularly buy several things, like cat food, paper, and some food items, at either Wal-Mart or the Dollar Store, whichever has the best price that week.

        I’d consider a grocery store in the comparison shopping process if we still had a locally owned one that has competitive prices, which we did last year but don’t this year. We do still have a Food Lion. Hello? Every time I’ve given in to convenience and bought food at Food Lion, during the past five years, I’ve been sick! We are talking about trusted name brands, sealed, not out of date–the same thing I would’ve bought at Wal-Mart. I don’t know what’s going on but I no longer consider buying food at Food Lion.

  5. WalMart came into my small hometown in the mid-70’s and eventually put most of the town square retailers out of business. However, most people now love having a super WalMart to shop at and there are a lot of other smaller businesses that have sprung up around it, making it the thriving retail hub of the town. So, although it did change the traditional small-town atmosphere, I think the net change has been for the good over the long run. As the author also notes, dollar stores are, in many cases, the only businesses who will take the risk to open a store in many blighted urban areas. My take is that, in general, it is best to let the free market determine the best means of assessing needs and providing products and services to meet those needs. Inefficient business models that aren’t profitable will either be eliminated or replaced with ones that are.

    1. THANK YOU PRESSKH!! I was at first afraid yours would be the usual leftist rant, but, as I read on, it became clear that your response is an intelligent one, and as comments go, fairly rare. My first year college roommate was the son of a farmer in a very small mid-south town in Illinois, and when this town, population about 800, got a Walmart nearby, everyone was THRILLED!! Now they could get good, fresh, inexpensive foods, instead of weeks old produce, limited fresh and even canned food choices, etc. GO CAPITALISM!!

  6. Dollar General isn’t a dollar store. So, what is this article about?

    1. If you mean Everything is a Dollar or less, neither is Family Dollar. I think Dollar Tree is still all a dollar or less though.

      1. Dollar Tree for the win. They have paper towels, dishwashing detergent, aluminum roasting pans, “theater box” candy, sugar free cough drops, spices – all sorts of useful stuff the supermarkets will sell you at 3 times the price. I hit them regularly, along with stores that exceed the $1 price-point, like Big Lots! and Ocean State Job Lot. I get meat, fish and fresh produce at the supermarket, and while the DT in the town I work in has a refrigerated section, the one closer to home does not. I also shop at Aldi, which, except for the changeable sale prices in the SMs’ weekly printed circular or website equivalent, usually has better prices. I can always get a whole chicken or parts there for $1/lb, if not less. Some of my neighbors in a 5-mile radius make a hell of a lot more money than I do, but judging by the cars in the parking lot, DT customers may be using an EBT card or an Amex card with one of the exclusive colors. Supermarkets advertise sales on certain items, then soak you on others that are high margin. As long as the distances between competing store types aren’t too great, with time and fuel spent visiting them negating the bargains, splitting your shopping list makes sense. Don’t bother if you have to make a separate trip to hell-and-gone.

  7. The only thing new about dollars stores is being called dollars stores. Before that they used to be dime stores. But where I am at, the two dollars stores are under cut by Walmart and First Choice Market.

    1. Before that they used to be dime stores.

      Indeed, *five* and dime stores: Woolworth, Kresge, ….

      Did people complain about *those* back in the day?

      1. “Did people complain about *those* back in the day?”

        Don’t know, but it wouldn’t surprise me if they did.

        1. We had fewer commies in academia and the general population back then, so not as much.

        2. In my South Shore, Long Island home town, the last “market town” before you headed east to the Hamptons, circa 1965 we had Woolworth and W T Grant. The Depression-era name was a “five-and-dime store.” C’mon all, you remember Cheryl (Brooks) Taggart, James T’s wife, from Atlas Shrugged, don’t you? Jimmy found a million dollar baby in one. The song was introduced in a Broadway show, and it was recorded many times. Here’s the Fred Waring hit version.* Some nearby towns had another 5 & dime, McCrory/McLellan.

          * YouTube has a 1926 version with a different melody, which i never knew of before today.

        3. They did, and then they got slapped in their commie faces.

      2. Oh, I’m sure someone did.

        1. In the 1920s and 1930s, there was a movement in the U. S. to impose punitive taxes on chain stores. There’s even an academic study on the subject –

          http://eprints.whiterose.ac.uk…..proofs.pdf

          (by a UK academic)

          1. Let me guess: the movement started with the mom-and-pop establishments? The complaints seem to always come from mostly those who are threatened with losing their cash cows. I remember reading about when theaters were trying to drive the TV networks and manufacturers out of business.

      3. Did people complain about *those* back in the day?

        They sure did. They attracted the wrong people to small town shopping districts.

  8. Although I believe Ms. Mitchell is well-intended, ironically, she continues to promote ILSR solutions which don’t respect fundamental principles of self-reliance, not to mention basic economics.

    Her personal visions of what are better for people are just that. They may or may not be true from another’s perspective.

    As such, ILSR’s efforts often seem to border on elitism, but worst of all, they always seem to require more governmental intervention, not less – an oxymoron to its very name.

    If you want people to have greater self-reliance, then you must trust them to make decisions for the themselves.

    If you have a vision to help them – great! Then sell them on it; don’t ask the government to force it on them. Greater intervention and force always equal less choice, which is simply less power for the consumer; thus, less room to be self-reliant. These proposed solutions do not operate in a vacuum.

    And this perhaps reflects an even greater problem: a lot of smart and caring folks, who were neither educated about nor experienced in true day to day economics and the need for consistency to avoid such hypocritical stances, unknowingly pile-on to these “societal problems” by using the same tool to achieve their visions (force of government) which is largely responsible for said problems in the first place.

    1. If you want people to have greater self-reliance, then you must trust them to make decisions [for] themselves.

      Well, maybe *eventually*. 😉

      1. Subject to federal regulations, periodic review, government-funded academic study, neighborhood watch group watching, and class action law suits.

  9. When I was a kid we used to shop at the “5 and dime”. And yes that’s exactly what we called it. I remember when a candy bar was a quarter. Dollar stores are great for when you’re moving into a new place and can get a ton of stuff for a fraction of the price of anywhere else. They are also great for failed product offerings like Bloomin Onion Pringles and Pig in Blanket Poptarts.

  10. “Institute for Local Self-Reliance”
    Because Juche has always been a model for economic prosperity.

    1. the Institute for Local Self-Reliance (ILSR), a nonprofit advocacy group with offices in Minneapolis, Maine, and Washington, D.C., that “challenges concentrated economic and political power, and instead champions an approach in which ownership is broadly distributed, institutions are humanly scaled, and decision-making is accountable to communities,”

      What’s more local to me than me? You realize that what their mission statement means is that shit shouldn’t belong to whoever bought it or made it (concentrated economic power}, but that everybody owns everything (ownership is broadly distributed) and therefore everybody has a say in what we do with “our” shit (decision-making is accountable to communities).

      They’re out-and-out socialists and, as I’ve said many times, you can’t really compare capitalism to socialism because capitalism deals with the production of wealth and socialism deals strictly with the (re)distribution of wealth. Socialists are like a group of children discussing how to divvy up the cake and ice cream with no real comprehension of how the cake and ice cream got there in the first place. You want cake and ice cream? It’s really simple, you just tell Mom you’d like some cake and ice cream and she goes to the store and gets you some. How hard can it be to get cake and ice cream?

      1. the Institute for Local Self-Reliance (ILSR), a nonprofit advocacy group with offices in Minneapolis, Maine, and Washington, D.C., that “challenges concentrated economic and political power, and instead champions an approach in which ownership is broadly distributed, institutions are humanly scaled, and decision-making is accountable to communities,”

        What’s more local to me than me? You realize that what their mission statement means is that shit shouldn’t belong to whoever bought it or made it (concentrated economic power}, but that everybody owns everything (ownership is broadly distributed) and therefore everybody has a say in what we do with “our” shit (decision-making is accountable to communities). They’re out-and-out socialists

        Odd because as I started to read the article, my impression was that ILSR was a libertarian organiz’n of the type frequently written about here. Challenging concentrated economic & political power read as my goal too. Ownership’s being broadly distributed to me was both the process (as in public corps.) & result of free enterprise. Institutions being humanly scaled & decision-making being acc’table to communities looked to me like freedom from autocracy & big gov’t.

        1. Well, OBL might tell you they’re the wing of the LP that supported Bernie Sanders. Are you familiar with the Democratic People’s Republic of Korea? Doesn’t a Democratic People’s Republic sound like a wonderful place to live? Sadly, those words don’t mean quite what you think they mean.

          1. The “buy local” crowd is on “our side” when they oppose state & local government doling out corporate welfare to bring in national firms to compete with established businesses. The pols naively think the Big Boxes and “category killers” will increase the local property tax rolls, & generate more sales & income tax revenue. On net, they might, but they are just as likely to draw chunks of business from the customers of the existing locals, resulting in a net loss for the town, school district, etc. Let them build, but don’t hand out tax breaks or splash out for infrastructure to support the new shops out of proportion to what the competition has been able to take advantage of. You’d hope for a level playing field, but the thumb is usually on the surveyor’s tools. The ILSR types are our opponents when they pull crap like this. Very few supermarkets are not part of regional or national; chains. We do have some nice IGA markets here in NE that are locally or regionally owned. The one nearest my house closed when the landlord jacked up rents. He did the same to WalMart, and they also closed. The WM space is slated to open as a regional chain supermarket, but that is going slowly.

  11. “As a large company, Dollar General can lose money at a new location for a much longer period (making it up elsewhere in the chain),” Mitchell also adds. That makes sense. “I think this is something libertarians don’t really wrestle with. Big companies can ‘win’ competition not by virtue of being better or more popular, but by virtue of being larger.

    This has been shown as nonsense time and again. An inefficient store which lowers its prices enough to drive a more efficient store out of business must perforce lose more money than the efficient store in doing so. Ergo, they must raise prices afterwards and/or in other locations more than efficient stores. That makes them that much weaker for the next competitor. The failed store also leaves behind assets, presumably sold at bankruptcy; the winner has no need for it, so if they buy the assets, it’s just wasted money; if a new competitor buys the assets, that’s a cheap way into businesses, making them even more efficient and increasing the winner’s losses next time.

    Monopolies only exist as a result of government meddling.

    1. This is stupid. Monopolies and undercutting to drive out competition was the reason for guilds in the first place.

      That our government acts as a corrupted guild association is tangential to the fact undercutting can drive out business to result in a larger market share.

      Your assumption that the under utter needs be inefficient is neither here nor there.

      1. Guilds only worked by using *force* to enforce their cartelization.

        Monopolies only work when someone is using physical force to keep out competitors.

        1. Guilds only worked by using *force* to enforce their caramelization.

          And in exchange for that they at least required meeting some sort of standards, unlike today’s unions.

            1. Huh, well I’m going on a history class from 30 years ago. My understanding was that to be in, say, the glass blower’s guild, you had to actually be able to blow glass. I’m sure I could be misremembering. I’m in the musicians’ union- as long as you pay the fee you’re in, you don’t have to be able to so much as be able to whistle.

          1. That was the PR explanation. It may have had some truth to it, but with guilds limiting competition, how could you ever know?

            Also, forced caramelization is just the worst.

            1. At least it’s tastier than forced autocorrection.

    2. I sometimes think preoccupation with efficiencies and fondness for creative destruction misses the point- the process you describe is all well and good, but meanwhile people are thrown out of work, lives are disrupted, it all adds stress to the portion of society least able to cope with it well. This is, in a nutshell, the populist complaint of “the system” working for the money people but not the average joe. The investors play their stupid games, win stupid prizes, and the little guy always loses.

      Your post also assumes people act rationally, which they do not. You might say it’s been shown to be nonsense, but *it happens* because people are irrational assholes.

      1. . . . but meanwhile people are thrown out of work, lives are disrupted, it all adds stress to the portion of society least able to cope with it well.

        Show me a system where this happens less. Every system – look around the world, both today and throughout history – and show me a system where ‘the little guy’ is better off.

      2. If monopolies truly were more efficient than their competitors, they wouldn’t have to resort to predatory pricing and other unsavory practices to drive them out of business. Heck, the competitors wouldn’t be able to compete if they were less efficient.

        This is well illustrated by Standard Oil. Rockefeller got 90% market share precisely because he was more efficient. His market share then dropped into the 60% range by the time the trust busters split up Standard Oil, precisely because the competitors learned how to match his efficiency. Note also that Rockefeller did NOT resort to predatory pricing and other unsavory practices; those are inefficient and Rockefeller modus operandi was efficiency.

        Your ignorance of history and of basic economics is appalling.

        As for people acting rationally … yes, most people do act rationally — by their own standards. They don’t care about your standards or your rationality, only about their own. People follow incentives, they have motives, they have goals, and they act based on those incentives, motives, and goals, which are theirs alone, not yours, and they especially are not yours to criticize. But you are a statist, and you deem everyone else to be ignorant and irrational.

        Fuck off, slaver.

        1. One merchant who testified to the Committee on Combines reported that he could not break even below $6 a ton in 1888 and he could not earn a “living profit” (a term used by historian Michael Bliss) at that price. However, in the same year, advertisements in the Ottawa Daily Citizen reported prices of $5.05 to $5.30 per ton for merchants associated with the Ottawa Coal and Cartage Company. These prices were down from $6.50 to $6.75 in 1881. This suggest that the merchant in question was unable to compete with more efficient players who were getting the loyalty of customers. This also mimics the findings of American economic historian Werner Troesken, who highlighted how inefficient firms were the ones pushing for the Sherman Act in the hope of hindering the more efficient firms.

          See that “efficiency” popping up all over?

          Fuck off, slaver.

        2. Your ignorance of history and of basic economics is appalling.

          But you are a statist, and you deem everyone else to be ignorant and irrational.

          Fuck off, slaver.

          This place is just amazing. Someone posts thoughts and ideas in good faith to shoot the shit and this is the reply. I’m happy to hear criticism back, and I enjoyed the other stuff you wrote. But I don’t understand the obsession with insulting people, and you’re far from the only one.

          Also, point out in my post where I’m a slaver, or claimed everyone was ignorant. When I said “missing the point” I was referring to values, not knowledge. Efficiency isn’t everything. “The justification for free enterprise is not that it’s more efficient, but that it’s free.” But there’s that ol’ freedom/responsibility thing. Hoping for people to take into account others than themselves isn’t statist, it’s being a decent fucking human being and taking responsibility for yourself, your family, and your community. Community and people caring about each other is not slavery, it’s what we do for each other to keep humanity from plunging into dystopian strife. I’m reminded of the question in the parable of the good samaritan- who is my neighbor? I’m sure most people here would help a neighbor in hard times, and the world has gotten so much smaller and more connected, I think we need to start expanding who we think of as our “neighbor”.

          1. (cont. due to character limit)

            Libertarianism has changed, gotten quite mean spirited. Pushing an ideology without taking into account negative real world consequences on the ground is just the same the communists did.

          2. Nice. Comment on the one bit of hyperbole, refuse to recognize it as the common Reason tag line it is, and refuse to comment on any of the substantive post which rebuts you.

            Nice.

            Fuck off, slaver.

            1. and refuse to comment on any of the substantive post which rebuts you.

              Why would I try to have a normal conversation with someone who is insulting?

              1. Because I explicitly call you out as a slaver? Everything socialists do is predicated on them being the elite guiding the stupid, ignorant, naive, gullible slaves.

      3. The only way people can never be thrown out of work is to have a completely static society. Beyond job losses, this includes no innovation, no inventions, no progress; no work accidents, no equipment malfunctions, no weather or other acts of god; not even births or deaths or vacations.

        You, like every other socialist, have a fantasy of everyone obeying central planners, who only have everyone’s best interests at heart and are all-seeing and all-wise. They react instantly and perfectly to every natural disaster or accident, shuffle resources around instantly and in advance so there are no disruptions to anyone’s perfect life.

        You allow no room for people to get tired of boring perfection. A factory worker who’s tired of turning wrenches, or a garbage man who’s tired of lifting heavy cans of stinky garbage all day, can’t go to night school to learn some new skills, or work with their brother-in-law, or start their own business. No one is allowed to improve their lot in life, because that would disrupt their co-workers. their businesses, and their customers. No one has the choice to retire early for less pension or later for more. The central planners will decide that. They won’t have the choice of tying one on and being hungover in the morning and calling in sick, because that would disrupt their fellow workers.

        Fuck off, slaver.

        1. You’re doing a great job of arguing with someone in your head. You’re just as bad as the die hard SJWs on prog boards, who see some small thing that they think is a big tell that you’re the enemy and as bad as satan.

          Have a lovely evening.

          1. Naw, I directly challenged YOU. You recognized that too, or you wouldn’t have deflected the topic elsewhere and pretended I was off an a magical mystery tour, jousting with snowflakes.

    3. Yeah, it always amazes me that so many people still believe in the “predatory pricing” fairy tale. Even if a would-be monopolist actually drove all their competition out of business, they still couldn’t charge whatever they wanted. Investment follows profit, so as soon as they start taking above-market profits, new competitors will appear. Sure, they can lower prices to block them, but they’d have to do this every time, so they could never charge much above market price for long.

      There are only two ways to maintain a monopoly. One is to provide a better/cheaper product than any competitor, forever. (And if one person/company could do this, no one would get hurt, so what’s the problem?) The other is to use threats and violence to drive away any competition. Gangsters do this themselves, legal businesses outsource the threats and violence to the state.

      The same goes for cartels; without some enforcement mechanism, they tend to fall apart. There’s always a temptation for one member to cheat on their self-imposed limitations. Once one member does cheat, that only provides more incentive for others to cheat, and pretty soon the whole thing collapses.

  12. “but the respective cause and effect this research identifies?dollar stores put grocers out of business and “dollar stores concentrate in areas that already have few or no grocery stores”?seem at odds with one another.”

    And both of them are contrary to my personal experience. Here in Wisconsin, it’s quite common to see dollar stores located in out buildings on the lots of large chain grocery stores and/or a Walmart Super-center(sells groceries).

    1. Whoa, Mr. Buttplug got banned? What happened?

      1. All I know is there was a thread from about a week ago he posted in several times. Now all his comments there have vanished.

        I hope this isn’t the end of Mr. Buttplug. He’s a valuable left-libertarian voice with an unmatched knowledge of economics. But in the meantime, I will try to carry the torch and share any info I can find about the dismal state of the Drumpf economy, just like he would have done.

        1. “an unmatched knowledge of economics”

          We are in total agreement there.

  13. “Earlier this month, the Institute for Local Self-Reliance (ILSR), a nonprofit advocacy group with offices in Minneapolis, Maine, and Washington, D.C., ”

    Is Minneapolis, Maine a place?

  14. Vexing how an organiz’n whose stated objectives are so libertarian can come out so…wrong. Did they just go wrong, or did they have a hidden agenda that they wanted to misstate in libertarian terms?

    I usu. stop at Dolgen before ShopRite. I’d buy even more from Dolgen if I didn’t need to restrict Na consumption & therefore not buy much in the way of canned goods.

    1. I don’t shop often at the Dollar Something in ShopRite’s bldg. because they don’t carry 2L Cokes.

      1. If you stop drinking the 2L Cokes, that will probably do more for your blood pressure and overall health than avoiding canned goods.

        1. It’s just sugar water. Not enough caffeine in there to affect BP.

          1. That’s a lot of sugar, though. Insulin is a helluva drug.

            1. Or in my case, the only way to maintain weight.

    2. Hell, just look at how often Reason’s own writers come off just as wrong.

      Its just another ‘I’m a libertarian, but . . . ‘ situation where the speaker immediately abandons their libertarian principles along with logic because either their feelz or their livelihood are threatened by them.

  15. Somebody else may have brought this up before but, if so, I missed it. Kansas State Supreme Court rules cops smelling claiming to smell the whacky tobaccy at your front door provides “exigent circumstances” for warrantless entry.

    In the case, the cops found the devil’s weed after searching, inside a Tupperware container inside a locked safe inside a closet in the back bedroom. Who the hell needs a drug-sniffing dog when you got Officer Olfactory there with the superhero powers of smelling weed at thirty paces through three doors, a locked safe and a Tupperware container?

    If there’s any good news there, at least it was a 4-3 decision with the dissent bringing up the point that while Officer Olfactory claimed these super-human powers, a court of law might actually demand some sort of evidence of the claim before accepting it as fact.

    I’ve given up on trying to predict what our black-robed gods on the Supreme Court might decide after consulting the necessary and proper chicken entrails, but I’d like to think an appeal of this decision should take about 5 minutes and result in the KSSC decision being over-turned.

    1. That would in large part depend on whether there’s contradictory decisions in other jurisdictions which the USSC has to resolve – the Supremes usually turn up their noses at cases unless there’s discordant decisions to resolve.

      Remedying an injustice isn’t by itself good enough reason for the Supremes to take a case, as a general rule.

      It must be fun to be able to choose one’s own workload the way the Supremes do.

      1. One of the great parts of that decision is that it relied on the officer getting away with the ‘I smelled something’ ruse in other cases – because she had been cited as ‘smelling something’ in so many other cases that resulted in conviction, the court decided that her ability to smell had sufficient weight of evidence behind it to be taken seriously in this case.

  16. A few years ago, a grocery store opened right next door to the Dollar Tree two blocks from where I live. They’ve been doing great business ever since

  17. Same argument was used again Walmart coming to town.

    Good stores that can compete stay open. Over priced boutique stores go out of business.

    1. This. When our local Wally World upgraded to a super center, one grocery store did go out of business. That store generally had the highest prices and most limited selection in town, plus it usually looked kind of dingy and dirty. Other stores in town managed to offer something people actually wanted, and they’re still open. One even recently moved to a larger, nicer location. Right across the street from WM, oddly enough.

  18. OT – a prominent Australian cardinal was recently convicted of sexual abuse, but the Australian courts won’t let the media mention the case.

    Now an Australian prosecutor threatens a American Web site, Church Militant, with criminal proceedings for the “crime” of reporting on the case. Since the Web site is accessible in Australia, it is supposedly subject to the censorship order.

    1. I’ll bet they are not going to threaten the Washington Post, which also published the story on its website.

    2. What’s the punishment? The boot?

    3. Hey, makes at least as much sense as Canadian authorities arresting a Chinese citizen for dealing with Iran because the US government doesn’t like it.

  19. There are several “dollar stores” in my neighborhood, but they are all independently owned, not part of chains. Only one sells food of any kind. Yes, the food is either frozen (TV dinners, packaged burgers and other sandwiches) or simply packaged food that doesn’t need refrigeration (cookies, coffee,etc.) Yes,I buy there sometimes. It’s not true that “There’s nothing innate to fresh foods that is superior to canned and frozen alternatives of the same foods.” Of course there is, that is recognized by pretty much everyone. But packaged foods are more convenient, so it is a tradeoff. To get fresh meat, I have to go to the supermarket, which IS a chain store. There are a couple of stores that sell fresh fruit and other produce though, also small and independently owned, so they are where I go for that.

    1. I thought the “There’s nothing innate to fresh foods that is superior to canned and frozen alternatives of the same foods.” was a bit ridiculous too.

      Every moron knows that fresh food tends to have more nutrients. Some foods actually allow you to absorb more of certain things when cooked, others more when raw/fresh, etc. It does vary… But by and large fresh and raw is generally better.

      I do sometimes wonder why so many libertarians seem to have a “the new, modern, industrial way is ALWAYS better” type of attitude. It simply is not often times. Efficient is not always “better.” The fact is properly grown organic food DOES have more nutrients in it than factory farmed stuff. Factory farmed organic food doesn’t always, but if I set about growing XYZ veg in my garden, with proper fertilizers etc it WILL have more good stuff in it than XYZ veg from the store. FACT.

      Yet most libertarians seem to rail against such truthful statements, mostly I guess out of tribalism… Just because shit libs ALSO are into something, doesn’t make it default wrong. Same can be said for cheap disposable Chinese crap vs quality manufactured goods, lower cost store vs higher quality store, etc. It’s a value judgment ultimately. People like cheap, but that is not to say it is objectively better, just different.

  20. Dollar stores represent the affordable capitalist casino economy.

    Buying tons of cheap plastic disposable crap.

    Frack the oil out of the ground, refine it, pollute the air and water making crap, sell it for what the market will bear then throw it in the landfill and repeat.

    1. Woo-hoo! USA! USA!

      1. Beam me up Scotty.

    2. Back in my day we only had wood toys. And we liked it. If we wanted to talk to someone we took the horse to their house and talked in person. Our version of Nest was to put another log on the fire.

      1. ‘Wood’ toys. You kids and your indulgent parents.

        In my day we had clay toys and liked it.

        I have a little dradle
        I made it out of clay
        And when its dry and ready
        With dradle I shall play
        Oh dradle dradle dradle
        I made you out of clay
        Dradle dradle dradle
        With dradle I shall play

      2. Then you had it good. We had to talk to the horse.

        1. Mr. Ed was pretty snarky

  21. Are Dollar Stores Really Driving Grocers Out of Business?

    Who cares? Compete or fucking die!

    Driving inferior goods and services out of business is no vice!

    1. Inferior goods is the core of the dollar store business model.

      1. Who is to judge what is inferior? Is a paper plate inferior to a ceramic plate? It depends on your need and/or desire. So let them sell whatever they please and keep your uninformed judgments to yourself.

        1. Disaffected, anti-social people seem to be perplexed and bothered by the concept of judgment, particularly with respect to judgment beyond the binary.

  22. Some people just cannot stand for any individual to be able to make any choice at all.

  23. Odd. While traveling the West i always saw the dollar store as an alternative to Walmart for towns that are too small for Walmart.

    1. If access to a legitimate grocery store is so limited that a dollar store seems attractive for all but a few fill-in items on a shopping list, it’s time to want to move. I have sympathy for people who lack the resources to move — especially younger people — but not so much for people unable to recognize the situation.

      1. If you can fill your shopping list by doing so, what’s wrong w that?

        When I visited my friend Nancy in a small town in Mich. ~15 yrs. ago, I was struck by how much Walmart was shopped at. For the same quality of produce (sometimes better) back in the Bronx I could do a lot better on price at small greengrocers, and on other goods at small discount stores. What’s so great about “a legitimate grocery store”?

        Same now that I’ve moved to rural NJ. There are farmer’s markets & huge supermarkets, but the food at either of them is much more expensive than I was used to in the Bronx?except for the farmer’s markets & large supermarkets there, which were as overpriced as in the country. What the big stores offer is the convenience of 1 stop shopping. Plus they lure you in w a few loss leaders that vary from time to time.

  24. I’m supposed to pay more for food but not because the mom and pop grocery provides better food or superior service but simply because they’re small and local. Some advocate decided that was important and now I should pay for it, though I obviously don’t value small and local. I value…well, value. I see all kinds of local grocers, butchers, bakeries, etc. that do quite well and they all have on thing in common. Their quality and service are worth the higher prices to enough consumers to make a profit. Those that can’t meet that standard deserve to go out of business…not matter how quaint or hip someone imagines them to be.

    1. In my experience they mostly do well by specializing, offering either better quality or price on a smaller variety of goods. What they don’t offer is 1-stop shopping, which is for either suckers or those whose time is more valuable.

  25. Grocery stores don’t make money off of groceries. They make money off of the stuff they sell besides groceries.

    Either that or they raise grocery prices and then people shop somewhere else.

  26. There’s nothing innate to fresh foods that is superior to canned and frozen alternatives of the same foods.

    That’s a silly assertion even if aimed at uninformed malcontents.

    1. Is fresh corn better than frozen corn? It depends on your needs and plans. If you want to have it ready to consume next month, frozen is better. Get your uninformed judgments out of here.

      1. You didn’t mention high-sodium canned vegetables, you half-educated rube.

        1. The amount of salt in canned vegetables is harmless for most people. Only those few of us who have salt-sensitive blood pressure or kidney disease need be concerned about it.

    2. Fresh pumpkin is a lot of work to turn into a pie. Canned is clearly superior.

      Fresh squash is a lot of work to turn into puree to augment cheese sauce for mac and cheese, and there is a lot of waste or way too much mac and cheese. Frozen is clearly superior.

      Fresh meat only lasts a few hours on a backpack trip. Frozen will last a day. Canned(foil packs) lasts the whole trip.

  27. Dollar stores sell grocery items in small quantities. Many people often don’t need the giant economy size the supermarkets sell. Per ounce dollar stores are not cheap, but then again you are not paying for what you don’t need and wasting it. Their appeal is to certain people, like the elderly, singles, or the poor. Your dollar outlay is smaller and for just what you need at the moment. They have limited items, so no, they are not going to put Supermarket type stores out of business.

  28. Very true, especially of the canned goods discussed upthread. Dollar General does sell a few of the larger sizes, but mostly the smaller ones. Once you open a can, the contents are good in the refrigerator for only a few days. You might use up the contents of a large can in that time, but only if you sacrifice variety by committing yourself to eating from it every day for several days if you’re a childless couple, or every meal if you’re single.

  29. “But the research makes several assumptions that don’t stand up to scrutiny,”

    Almost always true in general, and ALWAYS true of socialist arguments.

  30. The nearest dollar store to me is in a mini-mall owned by a grocery store at the opposite end of the same building. I have not been impressed with their merchandise or prices, I’m waiting for the dollar store to put them out of business, but not holding my breath! BTW, where is Minneapolis, MAINE? I can’t find it on a map!

  31. Yeah businesses hate regulation unless it is regulation strangling competition. Saving profits is good regulations for these grocery stores…But thats not free enterprise. Cant have a regulation saving profits and then claim all regulations are bad…Thats pure hypocrisy and shows the falsehoods of being anti regulation. Regulations to keep consumers safe and free from evil corporations is always good regulations because corporations will not look out for consumer safety on their own, they never self regulate thats why we have regulations to start with….free enterprise does not mean your free to fleece and poison or harm consumers in the name of profit. But you cant tell idiots that because they go into stupid drive.

  32. Some snobs just need to “get a life”.

  33. What’s really driving the grocery-specific stores out of business is mismanagement. My home town had a Dollar General Store, which was not in competition with the various locally owned “neighborhood general stores,” before we had a supermarket. Then we got a supermarket, around the same time all but one of the storekeepers retired, and started buying food at the supermarket. One of the general stores did grow into a competing supermarket–for a while. But problems with the supermarket are what have forced people like me to start doing (much of) our grocery shopping at the Dollar General Store, which I remember as only even selling snacks for a long time.

    DG is cleaner than Food Lion, and smells better.

    DG does not systematically train its employees to be obnoxious, as FL does.

    DG food is less likely to make me sick than FL food is. (A lot of it is store-brand but it’s NOT out of date.)

    DG may or may not have better prices than FL–depends on what you buy–and has less of a selection, but it’s a safer and less unpleasant place to shop.

    So, if the grocery stores are losing money, which I know some of them are, instead of blaming the dollar stores they should look at what they need to improve. Personally I see two major areas of room for improvement:

    1. Make sure food is sanitary and fit to eat.

    2. Don’t allow cashiers to chatter and gossip in order to distract people while cheating them out of money.

  34. I essentially started three weeks past and that i makes $385 benefit $135 to $a hundred and fifty consistently simply by working at the internet from domestic. I made ina long term! “a great deal obliged to you for giving American explicit this remarkable opportunity to earn more money from domestic. This in addition coins has adjusted my lifestyles in such quite a few manners by which, supply you!”. go to this website online domestic media tech tab for extra element thank you .

    http://www.Mesalary.com

Please to post comments

Comments are closed.