On a Friday in April, Bob Tharp, the mayor of Decatur, Ark., takes me to see what used to be the commercial heart of his town. There isn’t much to look at beyond the husk of a Walmart Express: 12,000 square feet of cinder block painted in different shades of brown. The glass doors are locked, as they’ve been for 14 months. “For so many people in this town, to have to see this empty building every day, they couldn’t drive by without getting tears in their eyes,” Tharp recalls. The store had opened on a frigid morning in January 2015, just days into his mayorship. “Pinch yourself and it is true,” he’d posted on Facebook the night before. For the first time in a decade, the 1,788 residents could buy groceries in town. But the reprieve was short. The following January, word came from Wal-Mart Stores Inc.’s corporate headquarters, 18 miles to the east in Bentonville, that within the month the store would be closed.
“You rascals!” Tharp remembers telling the executive who called to deliver the news. “You come to these small towns, and you build these stores, and you cause all the mom and pops to close down, and now you’re the only ones left standing, and you want to go home? Why would you do that to our community?”
The Walmart Express had been a pilot store, the smallest ever for the world’s largest retailer, designed to test whether a national brand with major supply-chain advantages could wrest a profit from towns long considered too sparsely populated. The answer, it seemed, was no: The company closed more than 100 stores across Arkansas and other southeastern states that day.
Tharp did what he could to turn things around, putting out calls to urge a grocer, or any retailer, to move into the vacant building. He found no takers for a year, until at last, Dollar General Corp., which had operated a smaller store on the outskirts of Decatur’s downtown since 2001, agreed to relocate to Main Street—and start offering fresh meat, fruit, and vegetables.
The Decatur store is one of 1,000 Dollar Generals opening this year as part of the $22 billion chain’s plan to expand rapidly in poor, rural communities where it has come to represent not decline but economic resurgence, or at least survival. The company’s aggressively plain yellow-and-black logo is becoming the small-town corollary to Starbucks Corp.’s two-tailed green mermaid. (Although you can spot her on canned iced coffee at Dollar General, too.) Already, there are 14,000 one-story cinder block Dollar Generals in the U.S.—outnumbering by a few hundred the coffee chain’s domestic footprint. Fold in the second-biggest dollar chain, Dollar Tree, and the number of stores, 27,465, exceeds the 22,375 outlets of CVS, Rite Aid, and Walgreens combined. And the little-box player is fully expecting to turn profits where even narrow-margin colossus Walmart failed.
There are a lot of players in this market: Dollar General, Dollar Tree, Family Dollar, and they're getting competition from German efficiency in Aldi Foods and newcomer Lidl. The Saturday half-day trip to the giant Wallyworld, Costco, or Target to get everything all in one place doesn't work for flyover country where Amazon won't deliver, and "small box" chains are aggressively moving in. After all, the Mom and Pop stores are already long gone.
And I've talked about Dollar General before: the other main issue is price. Wal-Mart and Costco may be the champions of selling you that 55 gallon drum of mayo, but for convenience store location without the huge price hikes, you can't beat the model. And yes, there's still a Dollar General within walking distance of the new apartment building I moved to a couple years back, just like there was when I wrote that post seven years ago at the old apartment.
The more things change, the more they stay the same. The Dollar General Recession never really left rural America, and neither has DG. The Wal-Mart model isn't the only game in town anymore.
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