What: Dollar General and Dollar Tree reported strong sales growth as US dollar stores attract shoppers from all income levels amid ongoing affordability pressures.

Why it is important: These results reflect a shift in US retail dynamics, with discount chains outperforming traditional supermarkets and adapting quickly to changing consumer needs.

US dollar stores are experiencing robust growth, with Dollar General and Dollar Tree both reporting significant increases in same-store sales and expanding their customer base to include more higher-income households. Dollar General saw a 2.5 percent rise in like-for-like sales, while Dollar Tree’s same-store sales climbed 4.2 percent, with 85 percent of sales priced at $2 or less. Both chains are benefiting from consumers across all income brackets seeking value amid persistent affordability challenges, with Dollar Tree noting that 60 percent of its three million new households came from those earning over $100,000 a year. Meanwhile, lower-income shoppers are relying on these stores more than ever, increasing their average spend per visit. The sector’s momentum is further supported by strategic pricing adjustments in response to tariffs and cost pressures, even as traditional supermarkets like Kroger face stagnating traffic and increased pressure among middle- and lower-income customers. This shift underscores the growing importance of value-driven retail and the adaptability of discount chains in a changing economic landscape.

IADS Notes: The continued growth of US dollar stores, as seen in the strong results from Dollar General and Dollar Tree, reflects a broader shift in consumer behavior and retail dynamics, especially during periods of economic uncertainty (The Economist, December 2025). The appeal of dollar stores is expanding beyond traditional lower-income shoppers, attracting higher-income households seeking value, a trend also observed in BCG’s November 2025 analysis. This is reinforced by PwC’s September 2025 holiday outlook, which notes that value-driven choices are increasingly shaping consumer preferences. The competitive landscape is further influenced by the pricing power of major retailers like Walmart and Costco, who are leveraging their scale to manage tariff pressures (The Economist, May 2025). Meanwhile, Inside Retail’s April 2025 coverage details how new tariffs are prompting retailers to enhance their value propositions and private label offerings, with affordability becoming a key priority for consumers facing rising costs.

Americans head to dollar stores as affordability crunch pinches consumers