Popshelf, Five Below And The Incredible Growing Dollar Store (2024)

Dollars don’t grow on trees, but one of the latest names in on-trend retail may provide a general idea of where they can grow.

Popshelf, the bold and trendy “dollar-near” concept by value retailer Dollar General, is growing at a rate faster than inflation. The (mostly) $5-and-below chain, which targets higher-income, suburban shoppers and takes on popular specialty store Five Below, opened its 100th store in early November, the second anniversary of its launch. In the next three years, Popshelf expects to grow that figure 10-fold.

With such rapid growth, could Popshelf be poised to shake up several generations of retail tradition? It’s reasonable to expect that its success, especially following that of Five Below, will encourage other dollar chains to launch competing formats, and create a new, pricier generation.

Sure enough, they’ve been doing just that. Dollar stores, including Dollar General, have been diming-up their $1 price tags for some time.

A Ten-Cent Tour Of Dollar Store History

Dollar General traces its heritage to 1939 as a wholesale dry goods business called J.L. Turner and Son. In 1955, it converted to Dollar General, where nothing cost more than $1.

Soon, the rivals emerged. Family Dollar opened in 1959, offering everything for less than $2. In the 1960s, 99 Cents Only Stores opened. And in 1986, Only $1.00 – today’s Dollar Tree DLTR – entered. Its roots trace back to 1953, however, when it was a Ben Franklin variety store.

Despite the competition, Dollar General has remained the largest “dollar” chain, with 2021 revenue of $34.2 billion and nearly 18,600 stores. It is, in fact, the third-largest of any chain in the U.S., behind Subway and Yum! Brands, according to the trade pub Dollar Store Reviewer.

Coming in second on the dollar-chain front: Dollar Tree, which in 2015 acquired the now widely priced Family Dollar. The combined company counts more than 16,200 stores and $26.3 billion in 2021 sales.

Importantly, none of these chains are dedicated to carrying only $1 goods any longer. Dollar Tree was in fact the last holdout.

From Five Quarters To Five Dollars: Enter Popshelf

In 2022, Dollar Tree hiked all of its prices to $1.25. This is where Popshelf’s influence may be evident. Dollar Tree said its new, across-the-board price point was not the result of inflation, but rather part of a strategy to offer a wider variety of goods, MarketWatch reported. These goods could be more niched, appealing to new market segments.

Dollar General may have influenced its lead rival in other ways, as well. In 2003, it introduced Dollar General Market, which carries perishable items like dairy and produce. By 2021 Dollar General sold fresh produce at 1,300 locations, and said it would add the category to 10,000 additional stores.

Also in 2021, Family Dollar (Dollar Tree) began selling produce and frozen meats at nearly 100 locations, CNN reported.

In 2020, when Dollar General opened Popshelf, Dollar Tree was not far behind. Popshelf carries a rotating selection of household decor, fashion, pet, crafts and beauty items priced mostly at $5 and below. And while geared toward younger shoppers, its appeal crosses generations: “I walked in to pretty soaps and smell goods and ‘capture your eye décor,’ ” blogger (and grandmother) Sonya Kay wrote in “Less Hustle, More Coffee.” “It’ll become a regular stop. It’s what I call a ‘Happy Shop.’ ”

Meanwhile, on TikTok, younger Popshelf fan Mercedes Mitchell informs viewers: “The aesthetics of this place was dope.” And on Facebook, one Popshelf endorser explained, “With this economy we need all the help we can get and Pop Shelf [sic] delivers.”

Dollar Tree wants to deliver, too. By 2021, it began expanding its own higher-priced concept, called “Dollar Tree Plus.” This in-store section, like Popshelf, offers goods, such as home décor and crafts for $1, $3 and $5. In November, Dollar Tree said it had expanded the multi-priced concept to an additional 1,686 stores.

So far, the slightly higher-priced concept has legs. Dollar General has expanded Popshelf to nine states and expects to operate nearly 1,000 locations by the end of fiscal 2025, according to CNBC.

Dollar Tree, meanwhile, also is expanding a combo-store format with Family Dollar, a side-by-side destination that provides easy access to both store selections and their varying price tags. Dollar Tree plans to add 400 combo stores in 2022, for a total of nearly 650, according to Progressive Grocer.

Putting A Price On Preference

Varied concepts with higher prices require attention to new markets and preferences, and these can be different from what we’re used to with traditional dollar stores. Popshelf, for example, aims to “make every day special,” offer “stress-free shopping” and carry goods “that make living better.”

Such touchy-feely terms suggest that Dollar General recognizes its competitors are not merely other dollar stores, that the same people who grab paper towels at its nameplates might get their shoes at Nordstrom and their mascara at Ulta. This is a big reason these upward-moving strategies have the potential to make lots of dollars.

And why these three practices by Dollar General and others make sense.

  1. They spot opportunities among the core. People who shop dollar stores live in urban areas, but also rural areas. People who shop dollar stores have tight budgets, but also are middle income and wealthy. In short, dollar store shoppers can be anyone, any time. In September, Dollar General CEO Todd Vasos told CNN Business that his chain was attracting shoppers earning $100,000 a year. This is due to inflation, but an analysis of shopper data will reveal ways to keep those shoppers.
  2. They’re taking advantage of brand integration. Like Family Dollar and Dollar Tree, Dollar General is installing Popshelf into its existing “Market” stores where it makes financial sense. Of its 100 Popshelf locations, nearly 30 are located within Dollar General markets, combining their offerings. It plans to build 40 more such combo formats by the end of the fiscal year.
  3. They bring value beyond price. Dollar General may long retain its traditional base of dollar-shoppers, but it appears to understand that if it raises prices, it should offer more than merchandise in return. In 2022, after expanding its offerings of healthcare goods, the chain established a healthcare advisory panel. In announcing its healthcare strategy, Dollar General said it “recognizes the unique access it provides to rural communities often underserved by other retailers.”

Where Do Dollars Grow? Apparently, Anywhere.

The passage the dollar chains are taking toward trendier, higher-cost goods might signal a transformation of the traditional dollar model, but it doesn’t have to alienate its neediest shoppers. In fact, store categories dedicated to $1 items could be more actively sought out for necessity as well as treasure. In fact, Dollar General in September said it intended to expand its $1 selection, according to RetailWire.

In the end, the success of the $1 format does not rely on growing sales, but on cultivating relevance. And that, dollar for dollar, is a greater determinant of worth.

Popshelf, Five Below And The Incredible Growing Dollar Store (2024)

FAQs

What is the difference between pOpshelf and Dollar General? ›

Dollar General has a new store called pOpshelf that caters to those who want a more upscale shopping experience. pOpshelf sells Dollar General–branded items, as well as many other products. You can often get good prices at pOpshelf, but costs are higher than they are at Dollar Tree.

Is pOpshelf the same as 5 below? ›

Even though both pOpshelf and Five Below both fill the demand for a wider array of products at relatively low price points, visitors to the two retailers exhibit different consumer behavior. And one component that differentiates these brands is Five Below's expansion beyond the $5 price ceiling.

What company owns pOpshelf? ›

Why is five below so cheap? ›

Five Below keeps its prices low by controlling costs efficiently. Their stores are relatively small, averaging about 9,000 square feet, and they're often located in existing shopping centers. This helps keep overhead low.

What is Dollar General changing their name to near me? ›

Now, the company will expand its push to win wealthier customers in the suburbs using a new store model and name: Popshelf.

Can you use a Dollar General gift card at pOpshelf? ›

Two (2) $250 Dollar General gift cards (to be redeemed in-store at DG Market + pOpshelf retail locations).

Are Dollar Tree Family Dollar and Dollar General the same company? ›

Dollar Tree, which focuses more on middle-income shoppers in suburbs, bought Family Dollar in 2015 for $8.5 billion. The combined company hoped that by joining forces, it could grow its customer base, reduce costs and fend off bigger retailers like Dollar General, which is mainly in rural areas.

Is everything at five below $5 or below? ›

Five Below, Inc. is an American chain of specialty discount stores that prices most of its products at $5 or less, plus a smaller assortment of products priced up to $25. Founded by Tom Vellios and David Schlessinger and headquartered in Philadelphia, Pennsylvania, the chain is aimed at tweens and teens.

Is 99 cents store the same as Dollar Tree? ›

As part of its winning bid, Dollar Tree also acquired the North American Intellectual Property of 99 Cents Only Stores and select on-site furniture, fixtures and equipment.

What is the largest dollar store chain? ›

Key Data Points. Dollar General is the largest dollar store operator both in terms of annual sales (more than $34 billion in 2021) and total store count (some 18,000 locations in 46 states).

Is pOpshelf owned by target? ›

The first Popshelf store opened in Nashville, Tennessee, in the fall of 2020. Dollar General owns PopShelf with a vision of bringing a higher standard of discount shopping. It is a cross between Five Below and the Dollar Spot at Target for me.

Can you return items to pOpshelf? ›

pOpshelf offers a generous return policy, allowing customers to return most merchandise within 30 days of purchase.

Why does 5 below have $10 items? ›

The obvious economic explanation for Five Below's shift here is that by charging 10 bucks for products that are still pretty cheap to make, it's going to earn more profit. But this isn't exactly a move born of desperation, either.

Is Five Below ethical? ›

We are committed to upholding ethical sourcing practices globally, to protect the lives, freedom and well-being of all individuals who take part in manufacturing our products. Our vendor requirements outline zero tolerance policies, including forced and bonded labour.

Where does Five Below get their inventory? ›

During 2022, Five Below sourced from about 1,000 vendors, with 60% of purchases coming from domestic vendors and no single vendor accounting for more than 5% of spend, according to the company's 10-K. The retailer says its low-cost sourcing and operating model helps it meet its $5 price target for products.

What's the difference between a Dollar General and a Dollar General market? ›

Dollar General operates about 19,000 stores in the US, 2,700 of which focus on fresh groceries. DG Markets stock produce, meat, and other foods that aren't typically found in dollar stores.

What is Dollar General's target market for its pOpshelf initiative? ›

For the dollar store chain, Popshelf is a way to attract new customers and drive up profits. Its target customers are women who live in suburban areas and have an annual household income that ranges from $50,000 to $125,000, the company said.

Who is Dollar General's biggest competitor? ›

The main competitors of Dollar General include Target (TGT), Dollar Tree (DLTR), Big Lots (BIG), BJ's Wholesale Club (BJ), Ollie's Bargain Outlet (OLLI), MINISO Group (MNSO), Five Below (FIVE), PriceSmart (PSMT), Almacenes Éxito (EXTO), and Walmart (WMT). These companies are all part of the "variety stores" industry.

What makes Dollar General different? ›

The Convenience Factor: Basic but Effective 🛍️

Dollar General stores are basic and often not the most organized, but they offer convenience and low prices. This no-frills approach keeps their costs down and makes them the go-to option for their target customer base.

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