Shoppers flock to discount stores

Mary Galloway is a frequent shopper at discount stores.


"Religiously. It's cheaper. Money's tight," Ms. Galloway said. "I teach preschool, so I don't make a lot of money."

The Thomson teacher was shopping for supplies at Southern Dollar on Wrightsboro Road on Tuesday. Discount stores are also her source of food, spices and kitchen supplies.

Shoppers such as Ms. Galloway are the reason discount stores are reporting higher sales during the downturn, according to the National Retail Federation.

"Over the last year, we've heard that with consumers trying to cut back on their discretionary spending and only purchase essentials, a lot of people were looking to dollar stores and discount stores to buy their everyday needs," said Kathy Grannis, a spokeswoman for the National Retail Federation. "I think, in general, discounters have become a popular option for people who want to save a few bucks on items they would consider an everyday essential," she said.

Fred's Inc. reported Thursday that its third-quarter sales were 1 percent higher than last year.

Dollar Tree Inc. also reported its earnings Thursday, saying it had a 12 percent increase in sales in the third quarter compared with last year. Quarterly sales for the 3,800-store chain was $1.25 billion.

"Our sales momentum continued in the third quarter, driven by increased traffic," said Dollar Tree CEO Bob Sasser. "Leading categories in the third quarter included health and beauty care basics, household consumables and party supplies."

The International Council of Shopping Centers records sales for other discount retailers, including T.J. Maxx and Ross. In September, sales were up at T.J. Maxx by 7 percent compared with September 2008. Ross had an 8 percent increase in sales, said spokeswoman Erin Hershkowitz.

Cheryl Finch of Thomson shops at dollar stores two or three times a week and regularly buys everyday items from cleaning supplies to toilet paper. These stores assist with her budget.

"I can buy as much or more than if I went to Walmart, Roses or Kmart," she said.

Roses returned to the Augusta market last month after a 15-year absence when it opened on Windsor Spring Road. The discount store offers a variety of merchandise from clothing, toys and home furnishings. Dollar General recently opened a new store at 2344 Washington Road, relocating from Big Tree Shopping Center a block away.

There are at least 45 dollar-style discount stores locally.

Not all discount stores have been as resilient to the tough economy. Peggy Holland, owner of Southern Dollar, an Augusta-based independent discount store, said that her sales are down by half compared with last year.

"A lot of people are shocked. They think because of the economy the way it is, the dollar stores are booming and that's just not true. Everybody on Wrightsboro Road is having a tough time. I think everybody's holding off and waiting to see where they stand prior to the holidays," Mrs. Holland said. To bring in business, she has started promoting her store at flea markets on weekends. "We're crossing our fingers that things turn around again," she said.

Reach LaTina Emerson at (706) 823-3227 or