A day late and a dollar short… Efforts to rein in safety violations and address wage concerns at Dollar General and Dollar Tree are ramping up. On Tuesday, two activist investment firms introduced a pair of resolutions that would audit the state of employee well-being and pay inequality at the two leading US dollar stores. FYI: together, the chains make up over 60% of the discount market (#DollarDuopoly). Dollar General and Dollar Tree have asked investors to vote down the proposals.
OSHoot: Dollar General was deemed a “severe violator” by the Labor Dept., racking up $15.5M in workplace safety violation fines since 2017 (picture: blocked fire exits). In the same period, Dollar Tree (and its subsidiary Family Dollar) were fined $19M for violations.
Pocket change: Those penalties pale in comparison to earnings. DG’s total fines since 2017 amount to just 0.04% of its sales last year.
Checked: Combined, the two chains employ 377K workers in the US, but lack minimum-wage commitments like the $15/hour guarantee at retail peers like Amazon and Target. As of last year, 92% of DG’s workforce made less than $15/hour.
Low prices are in high demand… Family Dollar was behind only Walmart in food and beverage sales growth as of February. As inflation-pummeled shoppers hunt for savings and #DollarTreeDinners, companies like Kraft and Hershey's are working with dollar stores to stock their products. Dollar General said it’s seeing more traffic from higher-income customers ($75K+/year), and has sought ways to encourage higher spending (think: broom pieces sold separately).
Rolling stones are hard to stop… Fines aren’t slowing the dollar duopoly: more than one-third of all US stores opened in 2021 and 2022 were dollar stores, and DG plans to open 1K+ more this year. But some areas have opted to banish the chains to protect mom-and-pop shops: at least 75 communities have voted down dollar store openings since 2019.