What Is Dollar Store?

A dollar store is a store that sells inexpensive items for one dollar or less each. A popular concept throughout the world, the stores usually sell everything from cleaning supplies to children's toys to food.

Dollar Store in US and Canada:

In the United States, most, if not all, of these stores contain almost exclusively merchandise that is imported from overseas. There are many dollar stores that sell nothing but goods made in China.

Often the term "dollar store", used by the store, can be misleading. Some stores with the word "dollar" in the name, and even some claiming to be "dollar stores", have items that technically cost more (or less) than a dollar. The problem with the name is also compounded by sales taxes, which leads to taxable items costing the customer more than a dollar.

Separate from "everything costs $1 (or less)" stores, there are also stores featuring the word "Dollar" in their names, where the prices are in easy multiples of a dollar or 50 cents (for example, $2.50, $2 etc).

This concept is not new, and likely originated with the five and ten or five and dime, a store where everything cost either five or ten cents. The originator of the concept may be Woolworths, which began in 1878 in Utica, New York. Other five and tens that existed in the USA included W.T. Grant, J.J. Newberry's, McCrory's, Kresge, McClellan's, and Ben Franklin Stores. Inflation eventually dictated that the stores were no longer able to sell any items for five or ten cents, and were then referred to as variety stores.

The most notable examples are the large retail chains Dollar Tree, Dollar General, and Family Dollar.

In economic terms, the pricing strategy of dollar stores is inefficient as some items may actually be sold elsewhere for less than a dollar. However, this is balanced by the marketing efficiencies of a single price structure and consumers accept potentially overpriced items. The pricing inefficiency becomes unacceptable at higher price points. Thus there are no "100 dollar stores" where all items sell for $100; consumers expect to pay the correct amount as inaccuracies result in significant dollar amounts.

Some stores carry mostly new merchandise, some mostly closeout merchandise bought from other stores below regular wholesale cost. Other variations on the dollar store include the 99¢ store, and at least one $1.25 store. While they may each set a different amount, the stores' concept depends on having a single retail price point for all merchandise, regardless of wholesale cost.

Dollar stores are often franchises. Dollar stores are the modern incarnation of "5 and 10" or "five and dime" stores where all merchandise was ten cents or less.

Depending upon the size, some dollar stores may have a frozen food and drink section, and also one with fruits and vegetables. The Deal$ store chain in the U.S. is one such example.

Notable dollar stores:

# Canada: Buck or Two (163+), Dollarama (300+), Everything For a Dollar Store, Great Canadian Dollar Store (100+)

# Mexico: Waldo's: Todo Un Precio

# United States: Deal$, Dollar General Store, The Dollar Market, Dollar Tree, Family Dollar Stores, Greenbacks, 99 Cents Only Store, A Dollar

European Counterparts:

This phenomenon also occurs in Europe. In Britain they are called pound shops. One popular chain is called either Poundland[2] or Euroland, depending on whether in Britain or the Eurozone. It is quite common to find products originally intended for sale in other markets, despite differences such as packaging written in foreign languages. For example, one may find Pepsi from Poland or the Czech Republic on sale in the UK. (See also Grey market).

The Hema (Hollandse Eenheidsprijzen Maatschappij - Dutch Standard Pricing company) was originally a 'guilder' store, everything costing one gulden.

In Norway there is Tier′n, which is a colloquialism for ten kroner (crowns), about $1.40.

In Sweden there is Bubbeltian, called by some Tian, which is a colloquialism for ten kronor (crowns), about $1.25. Another chain that has been spreading in Sweden during the last seven years is Dollarstore[3], a chain where everything costs either 10, 20, 30, 40, 50 or 100 skr, which is supposed to roughly equal one, two, three, four, five or ten dollars. Despite the obvious similarity in name, it paradoxically does not seem to have any official connection with its American namesake, Dollarstore Corporation, and is limited solely to Sweden. Having a wider price range, these stores naturally also has a wider range of products than Bubbeltian, meaning more or less all of the aforementioned products excluding books and computer software. While it has only eleven stores yetsofar and has yet to reach any further south down the country than the town of Ludvika in the country's geographic middle, it is still one of the fastest growing low price chains in the country, after Netto and Lidl.

In Spain there are Todo a 100 shops ("everything for 100 pesetas (0.60 €)"), although due to the introduction of the euro and inflation, most products cost a multiple of 0.60 or 1 euro. Most of these shops maintain their name in pesetas, and most of them have been renamed as Casi todo a 100 ("almost everything for 100 [pesetas]") or Todo a 100, 300, 500 y más ("everything for 100, 300, 500 or more").

In Romania there are 38 000 lei shops. 38 000 ROL equals 3.80 RON (new Romania currency) and is the equivalent of about 1.20 euros. Excepting food, they sell about everything that can be squeezed at this price. Some stores also sell products at multiples of 3.80 lei.

Japanese Counterparts:

This type of retail is also observable in Japan. It is commonly referred to as "100-yen shop" (US dollar being 100 to 150 yen).

The stores are said to be proliferating across Japan since around 2001. This is considered by some an effect of decade long recession of Japanese economy.

For a long time, 100-yen shops existed not as stores in brick-and-mortar building, but as vendors under temporary, foldable tents. They were (and still are) typically found near the entrance areas of supermarkets.

100 Yen Shops (or One Coin Shops)have steadily gained in popularity over the last several years, perhaps reflecting a worse economic situation in Japan. 100 Yen Shops (百円ショップ hyaku-en shoppu) are everywhere, and they stock a variety of items from clothing to stationery, housewares to food, with each item priced at 100 yen. Such shops are analogous to dollar stores in the United States. A recent variation of the 100 Yen Shops are 99 Yen Shops, analogous to the 99 cent stores in the United States. Daiei also operates 88 Yen stores. The current Japanese sales tax of 5% is also added, making a 100 Yen purchase actually cost 105 Yen.

One major player in 100 Yen Shops is Hirotake Yano, the founder of Daiso Industries Co. Ltd., which runs the "The Daiso" (sic) chain. The first store opened in 1991, and there are now around 1,300 stores in Japan. This number is increasing by around 40 stores per month.

The key to the success of the 100 yen stores is to buy in large volumes, mostly from mainland China as well as other countries like Brazil, allowing the companies to negotiate large discounts. This way products that might cost five times more in other stores can be sold for 100 yen, still for a profit. In some cases, however, products may be found cheaper at department or grocery stores, particularly in the case of food products.

Similar shops have opened around other parts of Asia as well, some of them operated by Japanese companies such as Daiso. In Hong Kong, department stores have opened their own 10-dollar-shop (around USD1.28, JPY140) to compete in the market, and thus there are now "8-dollar-shop" (around USD1.024, JPY110) in Hong Kong, in order to compete with a lower price. Note that there is no sales tax in Hong Kong, but the relative price is higher than in Japan or the US.

Australian counterparts:

In Australia, these stores often sell aforementioned products for two dollars -- indeed, one store is named the "Two Dollar Shop", the other notable shop is named "The Reject Shop". Often, stores similar to these operate and are labeled independently. They are found normally in shopping malls, but also found in other areas streetside

Brazilian counterpartsIn Brazil, these stores are called um e noventa e nove (one and ninety-nine, meaning BRL 1.99, about US 90 cents) usually written as 1,99 (note the decimal comma). They began to appear in the decade of 1990 possibly as a consequence of both the increase in the purchasing power of the low income classes after the curbing of hyperinflation and the decrease in middle-class net income due to a gradual increase in the national average tax load.Present everywhere, usually independently owned, these stores offer a large range of choices, from cheap toys made in China to kitchen utilities and office supplies. Indeed, despite their names, few items are really below BRL 2.00.Brazilians sometimes use the expression um e noventa e nove to refer to cheap, low quality things or even people.

*Content adapted from the wikipedia

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