US brands look for dollar store presence | WARC | The Feed

US brands look for dollar store presence

More and more US CPG brands – from Heinz to Schick – are building teams and creating products specifically to address dollar stores. 

Why it matters

We’re seeing a marked shift in how brands view dollar stores, driven by a cost-of-living crisis. Where these were once an outlet for remaindered stock, they’re now a target market as CPG brands have to respond to a fast-growing sector that is taking an increasing share of US household grocery spending. 

Kraft-Heinz, for example, last year created a new team to identify and develop products for dollar stores. “We’re trying to provide solutions that show the dollar space as more than ‘soda and a snack’,” a spokesperson told Reuters.

Takeaways 

• Even as brands seek more presence in dollar stores, the stores themselves are expanding their private label selection, including premium lines. 
• It’s a defensive tactic for consumer brands which have seen the impact of the rise of so-called discounters in Europe selling cheap private label goods. 
• A crucial metric for dollar stores is ‘dollars per point of distribution’ for individual products: this measures how much in sales each item generates over time and any failing to meet the threshold will be replaced.

Sourced from Reuters