With the wholesale pricing of the dollar store items you sell and the freight costs of bringing those dollar store items to your store continuing to climb every higher it is n o wonder more and more dollar store owners are looking for ways to increase their profit.
Two of the most popular options are going to a discount store format or to a dollar plus store format.
Both allow your pricing to go above the $1 cap faced with a traditional dollar store format.
But what are the potential impacts of making a move to above one-dollar? In this article I examine some of the important considerations for those who are examining the dollar plus store option.
* Check the local competition One of the important upfront steps to take is identifying the competition for your store.
Who are the competitors? What is their price point? You should even know their strengths and weaknesses before developing your game plan.
If the majority of your competitors operate at or below the dollar price point, you will need a very strong set of reasons for shoppers to make their purchases from you.
Just marking traditional dollar store items up above one-dollar and moving on is not the answer.
* Be prepared to deal with customer pre-conceived ideas about pricing.
This is especially true if you have the word 'dollar' in the name of your store.
This is a trigger word to many shoppers.
They have shopped traditional dollar stores for years.
You must provide a means of helping them transition to the new dollar plus store concept.
It can be done, just be prepared to do the required work and to make the required investment.
* Take steps to avoid confusion about the prices you charge.
While many $1 or 99¢ stores avoid adding price tags to their dollar store items, you no longer have that option.
Add clearly visible price tags, signs, and other prompters to help shoppers know exactly the price of every item found in your store.
If the price is not clear, many shoppers won't ask the price - they will move on to another retailer.
When done properly there is an opportunity to see your profits grow by changing format.
Even if total sales are lower than those found in a more traditional dollar-only or 99¢store, each dollar of sales will produce a higher percentage of profit for your business.
The challenge is just as it is with starting any business.
You must continually build sales to ever-higher levels.
Two of the most popular options are going to a discount store format or to a dollar plus store format.
Both allow your pricing to go above the $1 cap faced with a traditional dollar store format.
But what are the potential impacts of making a move to above one-dollar? In this article I examine some of the important considerations for those who are examining the dollar plus store option.
* Check the local competition One of the important upfront steps to take is identifying the competition for your store.
Who are the competitors? What is their price point? You should even know their strengths and weaknesses before developing your game plan.
If the majority of your competitors operate at or below the dollar price point, you will need a very strong set of reasons for shoppers to make their purchases from you.
Just marking traditional dollar store items up above one-dollar and moving on is not the answer.
* Be prepared to deal with customer pre-conceived ideas about pricing.
This is especially true if you have the word 'dollar' in the name of your store.
This is a trigger word to many shoppers.
They have shopped traditional dollar stores for years.
You must provide a means of helping them transition to the new dollar plus store concept.
It can be done, just be prepared to do the required work and to make the required investment.
* Take steps to avoid confusion about the prices you charge.
While many $1 or 99¢ stores avoid adding price tags to their dollar store items, you no longer have that option.
Add clearly visible price tags, signs, and other prompters to help shoppers know exactly the price of every item found in your store.
If the price is not clear, many shoppers won't ask the price - they will move on to another retailer.
When done properly there is an opportunity to see your profits grow by changing format.
Even if total sales are lower than those found in a more traditional dollar-only or 99¢store, each dollar of sales will produce a higher percentage of profit for your business.
The challenge is just as it is with starting any business.
You must continually build sales to ever-higher levels.
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