Variety store

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"Five and dime", "99 cents store", and "Dollar store" redirect here. For the cartoon, see Five and Dime. For other uses, see Convenience store and Dollar store (Cuba).

Interior of a Dollar General store in Fort White, Florida
99 Cents Only Stores in Dallas, Texas
F. W. Woolworth and S. S. Kresge stores on Lackawanna Avenue, in downtown Scranton, Pennsylvania. The two stores were often found near one another in downtown areas.
An art gallery in Seattle's International District preserves the façade and some features of Higo Variety Store, an independent Japanese-American five and ten.

A variety store (also five and dime (historic), pound shop, or dollar store) is a retail store that sells general merchandise, such as apparel, automotive parts, dry goods, toys, hardware, home furnishings, and a selection of groceries. It usually sells them at discounted prices, sometimes at one or several fixed price points, such as one dollar, or historically, five and ten cents. Variety stores do not include larger formats: general merchandise superstores (hypermarkets) such as Target and Walmart. Warehouse clubs like Costco, grocery stores, and department stores are also not considered variety stores.[1]

Economics

Pricing and margins

Some items are offered at a considerable discount over other retailers, whereas others are at the same price point. There are two ways variety stores make a profit:

  • Buying and selling vast amounts of goods at heavily discounted prices provides a small profit margin multiplied by the volume of sales.
  • Pricing many items at prices that are higher than regular retailers. These goods are commonly bought by consumers who perceive them to be bargains based on the heavy discounts on other items in the store. In the case of fixed price-point retailers, this can be achieved by reducing the size of the package.[2][3]

Variety stores with single price points buy products to fit those price points (while making a profit) that are:

Not all variety stores are "single price-point" stores, even if their names imply it. For example, in the United States, Dollar General and Family Dollar sell items at more or less than a dollar. Some stores also sell goods priced at multiples of the named price and, conversely, multiple items for the price. The discrepancy with the nominal price is also compounded if sales tax is added at the point of sale.

Supply

In many countries, stock can be imported from others with lower variable costs, because of differences in wages, resource costs or taxation.[citation needed] Usually goods are imported by a general importer, then sold to the stores wholesale.[disputed – discuss]

Another source of stock is overruns, surplus items and out-of-date food products. Real Deals, a regional dollar store in the Syracuse, New York area, is stocked almost entirely with surplus goods such as these.[4] The legality of selling out-of-date goods varies between jurisdictions: in general, most items (with a few exceptions, particularly certain perishable food items depending on the state) can be sold in the United States regardless of their sell-by date,[5] but in the United Kingdom it is illegal to sell goods after their "Use By" date.[6]

Demography

Although some people[who?] may link variety stores with low-income areas, this is not always true. For example, Atherton, California has a variety store within its city limits, even though it has a median household income of nearly $185,000 a year.[7] Studies of food discounters in Great Britain show quite a varied demographic,[8] and 99p Stores reported an increase in higher-income customers after the financial crisis of 2007–2008.[9]

By region

America

Several articles redirect here. For the "Oswald the Lucky Rabbit" short film see Five and Dime, For the 1931 film, see Five and Ten. For the book, see Nickel and Dimed

According to IBISWorld, dollar stores have grown 43 percent since 1998 and have become a $56 billion industry. Colliers International claims there are more dollar stores than drug stores. With stores of other types closing in large numbers, dollar stores often replace other types of stores in shopping centers. They succeed partly because of impulse purchases.[10] The common term in North America for a small general merchandise store is general store.

Five and dime stores

Walton's Five and Dime Store in Bentonville, Arkansas, the first store of what would eventually become Walmart.

Frank Winfield Woolworth had seen the success in Michigan and western New York of so-called nickel stores, where everything cost five cents (the U.S. five cent coin is called a "nickel"). On February 22, 1879, Woolworth opened his Great Five Cent Store in Utica, New York, and it was his later success and expansion of that format as the F. W. Woolworth Company that would create the American institution of the five and ten cent store (or just five and ten), five and dime, or dime store (a dime is the name of a US ten-cent coin).[11] Before Woolworth, the prevailing thought was an entire store could not maintain itself with all low-priced goods, but with Woolworth's success, many others followed their lead.[12]

Well-known dime store companies included:[13]

Of these, only Ben Franklin continues to exist in this form, while Kresge and Walton's became mega-retailers Kmart and Walmart, respectively.

Beginning around the 1960s, others tried the larger "discount store" format as well, such as TG&Y Family Centers, W. T. Grant, and Woolworth's Woolco stores.[citation needed]

With suburbanization in the 1950s and 1960s, Americans shopped more and more in malls rather than downtown shopping districts, and Newberry's and Woolworth's stores did open in the malls but even so, starting around the 1970s, variety stores lost business to other retail formats such as office stores, low-price shoe chains, fabric stores, toy stores and discount drug stores like Thrifty Drug Stores. Grocery stores and drug stores sold more and more candy.[14] The last US Woolworth's closed in 1997.[citation needed] Newberry's went bankrupt in 1992 and the brand disappeared in 2002.[15][16] 300 McCrory stores, many of which being[clarification needed] Newberry's, closed in 1997.[17][18]

Dollar stores

Interior of a Dollar Tree in Gillette, Wyoming

Starting in the late 1990s, dollar stores expanded enough to gain the attention of the national press. They were popular not only their value but because freestanding smaller stores were located in small towns, downtowns, and across the cities and suburbs, they were often more convenient than mall stores.[19] They continued to grow and by 2019, for example, Dollar Tree had higher annual sales than Macy's.[20] Dollar and variety store revenue reached $77 billion in 2018.[21]

As of 2018, main dollar store chains in the U.S. were Dollar General, Dollar Tree (which owns Family Dollar), the 99 Cents Only Stores, and Five Below. Dollar stores are experiencing an increase of revenue, with around 14,000 Dollar Tree locations in the U.S. in 2018 with plans to open over a hundred more; 15,000 Dollar General locations with plans for 975 more in 2019; and Five Below with 745 stores.[22]

Variety store chains in America

Names for variety stores in North America

  • Dollar store, $1.25 store, 99-cent store, etc. in the United States and Canada plus other names. Dollar store is used predominantly, even when the maximum price is higher than one dollar. Some chains emphasize that the price is an even amount: $2, $5, etc., instead of having odd, "uneven" prices.
  • Dólar y Algo Extra, La Reina, Almacenes Caravana in Puerto Rico
  • dime store
  • Five and Dime
  • Five and Ten
  • Nickel and Dime
  • Nickel and Ten
  • 5 y 10 in Mexico (5 and 10 pesos, or 5 and ten U.S. cents in border cities) - incidentally, Cinco y Diez, meaning "Five and Ten" in Spanish, became an inner-suburban shopping district in Tijuana

Oceania

Names for variety stores in Oceania

Asia

100-yen at Kōnoike, Higashiōsaka

In Japan, 100-yen shops (百円ショップ hyaku-en shoppu or 百均 hyakkin) have proliferated since around 2001. This is considered an after-effect of a decade-long recession of the Japanese economy.[29] Despite the emphasis on value, however, some items, such as chocolate bars, may be priced higher than they are at other stores.

For a few years, 100-yen shops existed not as permanent stores, but as vendors under temporary, foldable tents. They were (and still are) typically found near the entrance areas of supermarkets.

A major player in 100-yen shops is the Daiso chain. The first store opened in 1991, and there are now around 2,400 stores in Japan. This number is increasing by around 40 stores per month. Daiso has also expanded into North America, Australia, Asia, and the Middle East.[30]

In China, ¥2 (or ¥3, depending on the area's economic prosperity) shops have become a common sight in most cities. In Hong Kong, major department stores have opened their own $10 shops (US$1.28) to compete in the market, and there are now "$8 shops" (US$1.02) and even "$2 shops" (US$0.26) competing at lower prices, especially in poorer communities. Low prices are helped by Hong Kong's lack of a sales tax and its proximity to China.

In Taiwan, fixed price stores can be found in many locations, including night markets, regular shopping streets, regular market stalls, and department stores. Two typical price points are NT$39 and NT$49. Given that the retail environment in Taiwan is already highly competitive, it is not unusual to see such stores fail. Typically the goods for such stores are manufactured in China to keep costs down.

In India, US Dollar Store, founded in 2003, is a pioneer of single price stores. The merchandise for pilot stores was sent from America. As sales grew over the years with more than 200 operational stores in India, the merchandise is now imported from China, Indonesia, Thailand, Spain, Portugal, UK and various other countries as well as the US. US Dollar stores were founded by entrepreneur Gaurav Sahni, owner of Nanson Overseas Private Limited. Nanson, operated by Gaurav Sahni and his brother Gautam Sahni, has had an established sourcing and consolidation network for over two decades, with supply bases worldwide. Direct sourcing without intermediaries and stocking a large variety of merchandise as and when needed has given the company an advantage.

Variety store chains in Asia

Names for variety stores in Asia

Europe

The interior of a one-euro shop in Amsterdam, Netherlands

Names for variety stores in Europe

South America

In Argentina, variety stores are called todo por dos pesos (everything for 2 pesos).

Brazilians sometimes use the expression um e noventa e nove (R$ 1,99) to refer to cheap, low quality things or even people.

In Chile, they are called todo a mil (referring to the one thousand Chilean pesos banknote). They are commonly located in middle-class neighbourhoods where big retail stores don't usually venture and in small commercial districts like the ones in Santiago.

In South America, variety stores may be known as:

  • Dolarazo (US$1.00) and Cincuentazo (US$0.50) in Ecuador
  • Loja de 1,99 (R$ 1,99 = US$1.07) in Brazil
  • Todo por 23 pesos in Uruguay (23 pesos = US$1)
  • Todo por dos Pesos in Argentina (1 peso = US$0.32)

Africa

  • In Egypt, a variety store may be called a £E2.5 shop.

United Kingdom

Woolworth's opened its first store in the United Kingdom in 1909, when they were also colloquially known as "threepenny and sixpenny" stores, "3d and 6d" being displayed on the shops' frontages.[32][33] More modern counterparts include Poundland OneBelow and the former 99p Stores.

Global chains

Miniso is a Chinese variety store chain that specializes in household and consumer goods including cosmetics, stationery, toys, and kitchenware.[34] In 2016, the company's sales revenue reached $1.5 billion.[35] Miniso has expanded outside of the Chinese market and operates 1,800 stores in Asia, Europe, Oceania, Africa, North America, and South America.[36]

See also

References

  1. ^ "Dollar and Variety Stores". IBIS World Research. Retrieved 21 June 2020.
  2. ^ a b c Wallop, Harry (14 September 2012). "How Poundland makes its millions". Daily Telegraph. Retrieved 8 September 2013.
  3. ^ a b c Hall-Davis, Amanda (21 April 2011). "£1 stores can cost you more". Yahoo Finance. Archived from the original on 15 April 2012. Retrieved 8 September 2013.
  4. ^ Tobin, Dave (April 2009). "Business is booming for Auburn-based dollar store chain". The Post-Standard; syracuse.com. Retrieved 20 April 2012.
  5. ^ "Did you know that a store can sell food past the expiration date?". US Food and Drug Administration. 13 April 2013. Retrieved 8 September 2013.
  6. ^ "Guidance on the application of date labels to food" (PDF). UK Department for Environment, Food and Rural Affairs. September 2011. p. 6. Retrieved 8 September 2013.
  7. ^ "Atherton, CA Real Estate Data". RealEstate.com. Archived from the original on 11 September 2012. Retrieved 8 September 2013.
  8. ^ Thompson, Chris; Clarke, Graham; Clark, Martin; Stillwell, John (October 2010). "Modelling the future opportunities of food retailing in Great Britain" (PDF). demographicsusergroup.co.uk. University of Leeds. Archived from the original (PDF) on 10 August 2013. Retrieved 8 September 2013.
  9. ^ Harrison, Nicola (26 June 2009). "99p Stores guns for growth as profits soar". Retail Week. Retrieved 8 September 2013.
  10. ^ "Dollar stores among the new retail powerhouses". News & Record. 26 January 2012. Archived from the original on 30 July 2012. Retrieved 8 September 2013.
  11. ^ Nilsson, Jeff (12 February 2011). "Woolworth: A Five and Dime Story". Saturday Evening Post.
  12. ^ Plunkett-Powell, Karen (1999). Remembering Woolworth's: A Nostalgic History of the World's Most Famous Five-and-Dime. St. Martin's Press (New York). ISBN 978-0312277048.
  13. ^ Hayward, Walter Sumner; and Percival Albert Frederick White; chapters by John S. Fleek and Hugh MacIntyre (1922). Chain stores: their management and operation. McGraw-Hill Book Co. Inc; printed by The Maple Press (York, Pennsylvania).{{cite book}}: CS1 maint: multiple names: authors list (link)
  14. ^ "Dime Stores", encyclopedia.com
  15. ^ "Company News: 229 Stores To Be Closed By McCrory". The New York Times. 24 December 1991. Retrieved 5 November 2013.
  16. ^ "Local Dollar Zone stores shuttered". Dayton Business Journal. 19 December 2001. Archived from the original on 19 May 2005. Retrieved 16 September 2019.
  17. ^ "J.J. Newberry Stores to Close". Los Angeles Times. 28 January 1997. Retrieved 5 November 2013.
  18. ^ Millman, Christian (30 November 2001). "McCrory says it's going out of business** The five-and-dime chain joins others in giving up to bigger merchandisers". The Morning Call. Allentown, Pennsylvania. Retrieved 3 September 2019.
  19. ^ Stoughton, Stephanie (15 November 1998). "AFTER THE DIME STORE, A 'DOLLAR' EXPLOSION". Washington Post.
  20. ^ Phil Wahiba, "Making Billions of Dollars at the Dollar Store", Fortune, 2 February 2019
  21. ^ "Dollar Store Report June 2019", QRE Advisors
  22. ^ Tyler, Jessica (24 December 2018). "We Shopped at 3 of the Biggest Dollar-store Chains in America to See Which One Offered the Best Experience, and the Winner was Clear".
  23. ^ "Fourth Quarter MD&A" (PDF). Dollarama Financial Information. Archived from the original (PDF) on 30 June 2017. Retrieved 5 May 2017.
  24. ^ a b c "Dollar Tree Annual Reports (10-K) 2016" (PDF). Dollar Tree Financial Information - Annual Reports. Retrieved 5 May 2017.[permanent dead link]
  25. ^ "99 Cents Only Stores Reports Strong Fourth Quarter And Full Year Fiscal 2017 Results". 99 Cents Only Stores. Archived from the original on 13 August 2017. Retrieved 5 May 2017.
  26. ^ "USA Store Locator, DAISO JAPAN". Daiso Japan. Archived from the original on 27 April 2017. Retrieved 5 May 2017.
  27. ^ "Dollar General Reports Fourth Quarter and Fiscal 2016 Financial Results; Company Provides Financial Guidance for Fiscal 2017". Dollar General Newsroom. Retrieved 5 May 2017.
  28. ^ "Five Below, Inc. Announces Fourth Quarter and Fiscal 2016 Financial Results". Five Below, Inc. Archived from the original on 21 April 2017. Retrieved 5 May 2017.
  29. ^ Bender, Andrew (27 June 2010). "Bargain hunting at Japan's 100-yen stores". Los Angeles Times. Retrieved 28 October 2014.
  30. ^ Typical Overseas Stores Archived 12 November 2008 at the Wayback Machine
  31. ^ Hema.nl[dead link]
  32. ^ "Woolworths Group plc". encyclopedia.com. 2007. Retrieved 8 September 2013.
  33. ^ "Woolworth store openings in the 1930s". woolworthsmuseum.co.uk. 3D and 6D Pictures Ltd. Retrieved 8 September 2013.
  34. ^ "MINISO going places despite Muji copycat charge". Hong Kong Economic Journal. 10 June 2016. Retrieved 3 January 2017.
  35. ^ "Miniso stores set global retail record". Inside Retail Singapore. 30 March 2016. Retrieved 3 January 2017.
  36. ^ "Stores around the world". Miniso. Archived from the original on 9 March 2015. Retrieved 3 January 2017.

External links

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