infiltration of the beer consideration set has the dollar
channel garnered among this almost one out of every
two beer purchasers? An abysmal 1.2%, that’s what.
Dollar stores sell little to no single-serve beer, from
which convenience stores generate more than two-thirds of their beer sales and much higher margins.
The dollar strategy consists of capturing the fill-in
beer occasions from existing shoppers with a limited
assortment merchandised in one or two cooler doors
and one or two ambient shelves of six- to 12-packs.
Dollar store purchases of core convenience categories by convenience shoppers doesn’t break north of
2% until we get to non-alcoholic packaged beverages,
salty snacks and candy—each garnering purchases
from 2.1%, 4.7% and 3.4% of convenience shoppers,
respectively. One way to interpret this is that one out
of 20 convenience shoppers buy salty snacks from the
dollar channel. Convenience shoppers find more
national brands and familiar packaging for immediate
consumption in salty snacks and candy, in addition to
the draw of nostalgic, theater, novelty and value-driven
bag candy. But in a business of “penny profit,” the
convenience channel cannot afford to share almost
5% of its salty snacks shopper base with dollar.
Overall, the percentage of convenience shoppers who
consider dollar a viable channel for purchasing core
convenience categories is relatively low—but dollar has
an appetite for battle-tested methods to build incre-
mental sales within their existing customer base.
Additionally, of the 27,378 sites reported by TDLinx,
more than 21,000 are consolidated under two banners
(Dollar Tree/Family Dollar and Dollar General).
Strategic changes could be executed quickly across the
lion’s share of that channel and possibly catch the con-
venience channel flat-footed if not monitored.
Leroy Kelsey is the NACS director of industry
analytics. He can be reached at lkelsey@
nacsonline.com or (703) 518-4255. Learn
more at nacsonline.com/research.
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(Source: NACS Convenience Tracking Program, August 31, 2015; N= 10,000)