Dollar stores secretly charge you more than Walmart and Target, warn the experts
Do you really reduce costs by shopping from popular reduction retailers?
With stubborn inflation, many of us buy regularly dollar stores , hoping to reduce the costs of the essential elements of everyday. But while channels such as Dollar General and Dollar Tree always manage to offer prices lower than those of retailers like Walmart or Target, experts warn that they charge you more thanks to a secret strategy: Shrinkflation.
In relation: The 9 worst things to buy at Dollar Tree .
Invented by the British economist Pippa Malmgren In 2009, narrowing is a term that describes The "process of reducing the size or quantity of product while the price of the product remains the same or increases slightly", according to the Corporate Finance Institute (CFI). Basically, it is a hidden form of inflation that retailers use to try to transmit higher costs to customers in a less visible manner.
"Instead of increasing the price of a product, something that would be immediately obvious for consumers, producers reduce the size of the product while retaining the same price," explain CFI experts. "The absolute price of the product does not increase, but the price per unit of weight or volume has increased. The small reduction in quantity is generally unnoticed by consumers." AE0FCC31AE342FD3A1346EBB1F342FCB
A December 2023 report senator Bob Casey Indicates that narrowing has become a more common practice in recent years, "with around 10% of inflation being driven only by narrowing". Consequently, household products such as hygienic paper and paper towels are 34.9% more expensive than in January 2019, while snacks like Oreos and Doritos are 26.4% more expensive.
But it seems that some retailers use this strategy more than others. Dollar stores such as Dollar General and Dollar Tree are secretly invoice customers More in the long term for essential elements such as hygienic paper, soap and grocery store through narrowing, Fortune reported on February 12.
According to Business magazine, these items are more expensive by unit price in Dollar Stores than at other large retailers. For example, a pack of six bars of 3.17 ounces of soap costs sensitive to the dove $ 8 at Dollar General , but a pack of eight soap in 3.75 ounce bars $ 10.99 at Target . Thus, the cost per soap is around five hundred less in Target compared to Dollar General, despite the apparently higher price.
In relation: These are the products you "need to stop buying" at Dollar Tree, says shopper .
Even this small difference has a significant impact for retailers, Fortune explain. In 2023, Dollar General and Dollar Tree both ended up with benefits of approximately 31.5%, which was 7% higher than Walmart. Brian Nomainville , Director of Retail Consulting to the feedback group, told the magazine that Dollar stores maintained their beneficiary margins using narrowing to create the illusion of a good deal instead of obviously increasing prices and customers.
"This does not mean, however, that buyers will not notice that they get less for their money even without obvious price increases," said Nomainville.
In fact, customers are Become more aware of this sneaky practice. A Dec. 2022 Reddit Post Flaged "Dollar Tree Shrinkflation" by showing a pack of four fruit roll-ups that had been reduced to a pack of three. "And probably cheaper for more at Walmart," replied a person in the comments section. "Dollar Tree is almost always a scam when you check the price by Once."
A 2023 yougov survey Also found that 73% of consumers in the United States are concerned about narrowing. These consumers have cited "snacks (for example, chips, confectionery articles, nuts, etc.)" and "dry products (for example, cereals, flour, sugar, pasta, rice, etc.)" like the categories where they Note the tactics most.
Better life Contacted both Dollar General and Dollar Tree on accusations of withdrawal in their stores, and we will update this story with their response.
But when Fortune Finished, Dollar General defended its practices in the middle of inflation. "For more than eight decades and in a variety of macroeconomic environments, Dollar General has served millions of Americans seeking to stretch their budgets on essential household elements in a practical and easy to shop store," said a carrier Speech General Dollar General to the magazine. "We are continuously associating with our national and private brand suppliers to assess the best way to offer articles that meet the needs of products and accessibility of our customers."
