Residents Are Fighting Back at Dollar General—Why "Dollar Store Backlash" Is Growing
Locals in some areas have serious concerns about the discount chain's growth.
You can't deny that dollar stores have become a significant part of the retail landscape. Customers across the U.S. turn to them as an affordable solution in the face of rising prices—especially in areas with limited shopping options. But while it might be easy to assume the budget stores are widely popular, residents in some areas are beginning to fight back against retailers like Dollar General as they continue to spread. Read on to see why "dollar store backlash" is growing within some communities.
Dollar stores, including Dollar General, have managed to spread despite changes in the retail industry.
The past decade hasn't been particularly kind to the brick-and-mortar retail industry, with iconic chain stores and family-owned businesses alike shutting down in droves. But amid the shrinking number of storefronts, dollar stores have managed to buck the trend and increase their numbers. Discount chains made up the most openings for retail stores in 2022, with 1,858 locations added over the year, Retail Dive reported.
Even among other budget options, such as Dollar Tree and its co-owned Family Dollar, Dollar General stands out for its staggering growth. The dollar store increased its footprint from 8,222 stores in 2008 to 18,130 in 2022, making it the company with the most retail stores in the United States, Alabama-based public radio station WBHM reports. Over time, this means that the chain is opening roughly three stores every day.
The brand's explosive growth has also been matched by an increase in cash, with the company posting a net profit of about $2.4 billion last year. But even as it soars above all others, the retailer has the incentive to keep opening locations as each brings in a return of about 20 percent, Brian Yarbrough, a financial advisor with Edward Jones, told WBHM.
"They know the best return on their capital is adding more stores," he told the radio station.
Residents in some areas are fueling a "backlash" to the surge in stores like Dollar General.
Besides its sheer magnitude, Dollar General's growth stands out for the areas where it's taking place. The budget chain has opened many of its new locations in rural areas—especially across the southern U.S., where nearly half of the stores in Alabama, Louisiana, and Mississippi are in counties with less than 100 people per square mile, WBHM reports.
But while the stores may seemingly provide a convenient shopping solution in sparsely populated areas, they're also driving other essential retailers like grocery stores out of business. And now, there appears to be "a growing dollar store backlash" in the small towns where they've spread, according to NPR.
In Culleoka, Tennessee, local resident Liz Reeves says the enthusiasm initially felt about the dollar stores in her area has waned due to their effects on the local retail landscape. "We were ecstatic when it was there—weren't happy that it ran the little store down there out of business," she told NPR.
The community prevented recent plans to open a Dollar General in town.
Reeves' concerns about plans to open a Dollar General in town recently spurred her and other residents to action by rallying county officials to vote down the development. Locals expressed fear that beloved local businesses could meet the same fate as other priced-out operators.
"Why do we need another one when we're already surrounded?" she told NPR. "I'm mad at them. I really am. You don't come in and try to overtake where somebody lives because you want to make a dollar."
Culleoka resident Chris Gramling also joined the movement to block the retailer's spread, calling the chain a "vampire" during public comments at a town meeting discussing the development.
"It's unbridled growth for growth's sake," Gramling told WBHM. "To me, it's just unethical."
Other towns are taking note and pushing back against the sprawl of Dollar General stores.
Some areas have already become proactive in stopping the spread of Dollar Generals and other dollar stores. In 2019, officials in New Orleans, Louisiana, passed a law banning the opening of additional dollar stores after it was found that there were already 36 operating in the city—including more than a dozen in the New Orleans East neighborhood, WBHM reports. And lawmakers in Birmingham, Alabama, also recently passed a similar law with hopes of enticing larger grocery stores with healthier offerings to open in the city.
The dollar store backlash has also found support from advocacy groups such as the Institute for Local Self-Reliance (ILSR), which says the movement may be gaining momentum. In a February report, the group said 75 communities had successfully shut down plans to open locations since 2019, including 50 between Jan. 2021 and the end of 2022 alone.
Despite the recent successes, the group says the movement will need more support and legal mechanisms to have a greater impact. This includes federal-level involvement to consider antitrust action and curb the spread. "If we allow the dollar chains to keep multiplying at this pace, we're going to look back in 10 years and be very sorry that we did that," Stacy Mitchell, co-executive director of the ILSR, told WBHM.
In a statement to Best Life, Dollar General said that "thousands of our customers rely on Dollar General for convenient access to affordable everyday household essentials." The company said that 80 percent of its stores are located in areas with 20,000 or fewer residents, adding that it's "not unusual for us to hear from communities, especially in rural areas, asking us to bring a DG to their hometown." The company also said it would be adding fresh produce to 10,000 of its stores "in coming years," especially in USDA-define food deserts.
"In a wide variety of communities across the country, our neighborhood general stores operate alongside local grocers and business owners to collectively serve customers' needs," the statement said. "While we are not a grocery store, every Dollar General store offers components of a nutritious meal including canned and frozen vegetables, canned fruits, proteins, grains, dairy, and more."