Dollar Stores

Anything for a dollar

Last month Dollar Tree offered to buy Family Dollar for eight and a half billion dollars. But now, Dollar General is also offering to buy Family Dollar, and they are offering close to ten billion dollars -- more than one billion dollars more for Family Dollar than Dollar Tree offered.

All three stores cater to customers who don't have many dollars, and with people like Nelson Dollar making poor people even poorer, the customers of Family Dollar, Dollar General and Dollar Tree find themselves with fewer and fewer dollars to spend. That's why Dollar General and Dollar Tree are trying to buy Family Dollar. Not enough dollars to go around.

Regardless of who pays the most dollars for Family Dollar, it is reported that the new combined company will be renamed Almighty Dollar.

Inside the Dollar Store mindset

We received this inquiry today via email, and thought you'd find it intriguing. Offered, temporarily, without comment.

I saw that you recently published a commentary on the recent news of Dollar Tree's acquisition of Family Dollar. On this note, I thought that you might be interested on our most recent project, which looks at dollar stores and household income.

Looking at household income, turns out, is a pretty good clue in determining where the dollar stores are in the country. While Texas may have the most dollar stores, for example, it's Mississippi that has the most dollar stores per capita. Interestingly enough, both states have household incomes below the national average. And so we created "The Dollar Stores of America", a visualization that captures the relationship between dollar stores and household income. You can find it here:

Income inequality breeds greater income inequality

Because the poor get poorer, the rich get richer.

Let’s start with the backdrop: Essentially, the lower-income Americans that are the target customers of dollar stores have gotten too poor to buy anything other than food (a vivid illustration of Piketty’s point about income inequality). That has depressed margins and profits at these [Family Dollar and Dollar Tree] discount retailers.

So the people who own and manage these discount stores are going to end up hurting right? Hahaha, no, remember, the rich get richer.

Sunday thinking: Bargaintown

In the wake of Governor Pope's inauguration yesterday, editorial writers across the state are wondering aloud just what we can expect from the new regime. Readers of BlueNC don't need to wonder at all. We know exactly what North Carolina can expect. Our state is being methodically recrafted into a wholly owned subsidiary of the Mr. Pope's sprawling retail empire: Variety Wholesalers.

It doesn't take much intellect to understand the principles of slum merchandising. One need only look at Pope's proven business model.

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