Dollar stores expanding food offerings
April 2, 2014
by Monica Watrous
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MATTHEWS, N.C. – Signaling a move away from supermarkets into convenience and dollar stores, Family Dollar has expanded its food assortment to include more than 400 new items in each of its more than 8,000 stores.
Additionally, the retailer said it is lowering prices on 1,000 items, including such brands as Kraft, Hellman’s, Ragu and more.
“It’s important for us to constantly evaluate our assortment, making sure that we have the products and national brands that are relevant to her and her family, always at a great everyday value,” said Jason Reiser, executive vice-president and chief merchandising officer. “I am excited to add these new food items to our already robust assortment, and I am confident that our customers will be impressed by the expanded selection we have to offer.”
Grocery stores remain the channel of choice when purchasing food and beverage products, but consumers today are branching beyond the traditional outlets into drug stores, warehouse clubs and dollar stores.
As product offerings improve at dollar stores, so has the perception of the discount chains, according to recent research from Mintel, a Chicago-based firm. Half of survey respondents who earn $150,000 or more said they are shopping in dollar stores the same amount as they did the previous year, and 10% said they are shopping in dollar stores more.
Convenience and price drive shoppers to dollar stores, but more than half of survey respondents also said the stores are pleasant to shop in, and they find brands and products sold there to be as good as those found in other retailers. Still, 34% of the high-income shoppers expressed dissatisfaction with the selection.
Family Dollar isn’t the only discount retailer adding grocery offerings. Noting a natural advantage in a cautious consumer landscape, Dollar General has expanded the number of coolers in its stores to sell perishable products. Additionally, the company launched a more grocery-oriented Dollar General Market format to compete with conventional supermarkets.