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Is Amazon.com's new "$10 and under with free shipping" category a threat to brick-and-mortar dollar stores?
"The short answer is no," Euromonitor analyst Tim Barrett told Investor's Business Daily. "If cities are the main arteries of society, Walmart went in and filled out the veins of society and catered to all the suburban and even some rural (areas), but it turned out there are even more capillaries to fill, and that's where the dollar stores are doing well."
Dollar General opened 1,300 stores in fiscal 2017 and is looking to open an additional 900 in fiscal 2018. Dollar Tree opened 650 stores in 2017. Meanwhile teen-focused value chain Five Below and discounters Ross Stores and TJX continue to expand.
"We view the dollar stores as Amazon-resistant through their convenience play," wrote Deutsche Bank analyst Paul Trussell in a Jan. 26 note to clients. "Brick-and-mortar retailers offer the benefit of immediate acquisition versus waiting for delivery by mail, and dollar stores in particular own the last mile."
By Brannon Boswell
Executive Editor, Commerce + Communities Today
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