Sonia Thompson avoids her local Dollar Tree’s food and drink aisle at all costs — no matter the money she could save.
The 18-year-old UF microbiology freshman said she’s thrifty only when necessary. She buys clothing from Ross Dress for Less but never purchases groceries at dollar stores. The griminess of the shelves deters her from getting food there, she said.
Financially supported by her parents, Thompson is in a different boat than many of her fellow Gainesville residents.
Hector Sandoval, who directs the Economic Analysis Program at UF’s Bureau of Economic and Business Research, said stubbornly high prices have made consumers — especially those with low incomes — more price-sensitive.
“You want to keep your consumption level the same, so you start to buy these cheaper products. You start to make this substitution,” Sandoval said. “A lot of people start to just use the generic brand from Target or Walmart.”
Theft increases, retailers scramble
Those in crisis may resort to shoplifting, a persistent nuisance for retailers that has become even thornier lately.
According to the National Retail Federation, theft accounted for $112 billion of retail losses in 2022.
Discount stores like Dollar General and Dollar Tree have raised prices to cover revenue sapped by shoplifting, among other reasons, such as keeping up with inflation and competition.
Tianxin Zou, a UF assistant professor of marketing, said when retailers even marginally raise prices, they are swimming upstream. Passing the financial burden of losses onto consumers inadvertently invites more theft.
“More people have become poor, and they cannot afford the products. So they have to steal, unfortunately,” Zou said.
Discount stores, he added, generally congregate in rural and impoverished areas, where stealing is more prevalent. Zou said economic conditions have hemmed in retailers like Dollar General, forcing them to trim down their staff and security.
Kimberly, who works at Five Below at West University, said her location experiences routine theft. Her last name has been removed, as Five Below prohibits its employees from talking to the media.
“They take high-value items like stereos and electronics, cables, and we’ll have, every now and then, a group of high schoolers come steal slime,” she said.
Like many retailers, she said Five Below has a no-chase policy, so perpetrators get away relatively scot-free.
Although the company reported weak earnings last quarter, with theft contributing to revenue leakage, Kimberly believes it will prevail through economic contractions and unforeseen losses.
“We’re pretty recession-proof,” she said. “People are going to shop here because the cost is so low.”
Expanding as sales slump
Kimberly predicts Five Below’s plans for expedited growth are unsustainable at best and ruinous at worst. The company plans to open more than 200 stores this year, despite tracking losses between $2 million and $13 million. It currently has three in Gainesville.
“Anytime I‘ve seen a retailer just continue to expand, they normally go bankrupt,” she said. “I don’t think that would happen to Five Below, but it’s just, at some point, ‘When is enough enough?’”
Dollar General, which has eight local locations, joins Five Below in its plans for aggressive growth amid a dire revenue downturn. It is poised to open more than 700 stores this fiscal year.
Joel Davis, co-director of UF’s David F. Miller Retail Center, said the company must temper ambition with caution, especially in Gainesville.
“It’s a bit of a catch-22,” he said. “You expand, and you end up too big with too many [stores], or you don’t expand, and you end up going broke because you don’t get the investment you need to maintain your current operations.”
Davis said he doesn’t think the city needs another Dollar General, and certainly not near UF’s campus.
“I think if a Dollar General opened up across the street, you’d see people buying sodas there, but you wouldn't see a whole lot of other business there,” he said. “There’s already access to that here.”
Dollar store chains fill East Gainesville’s nutritional gaps
In East Gainesville, where most people are closer to a dollar store than a Publix, Davis said discount retailers have pushed grocery chains out of the market, creating food deserts — places where access to nutritious food is scarce.
Davis said dollar stores lack healthy food options and are rife with ultra-processed offerings.
“I can buy a can of soup, and I can buy a loaf of bread, and I can buy Coca-Cola, but I can’t also buy fresh produce,” he said.
According to the United States Department of Agriculture, nearly 48 million people — approximately 14% of the U.S. population — live in food-insecure households.
Higher rates of malnutrition and obesity are prevalent in food deserts, where people subsist on packaged snacks and treats replete with sodium, fat and sugar.
Jennifer Daniel, 22, said she doesn’t buy food from dollar stores but finds good deals at discount grocers like Aldi.
The UF applied physiology and kinesiology senior said she’s part of the Machen Florida Opportunity Scholars program, which provides financial aid and support to first-generation, low-income undergraduates.
Although her tuition is fully covered, Daniel said she still feels the pinch of high prices, especially at the grocery store.
“I don't even think I'm buying the best food out there. I'm shopping at Walmart and Aldi,” she said.
Daniel said her roommate, who’s from East Gainesville, shops for much of her essentials at dollar stores.
“Their community is really dependent on Dollar General, which is two minutes away from their house,” she said. “I was just really sad to hear that. It's like there's no other place for these kids and these families to get real food.”
Hannah Rider, a 20-year-old UF public health junior, also avoids buying food at dollar stores and worries those with no alternative are doing their families a nutritional disservice.
“It’s going to be canned vegetables, perishable food items or frozen chicken nuggets, which is just not a good idea to feed your children,” she said.
Still, Rider acknowledges that discount stores may be the only — and, therefore, the best — option for struggling families.
“Food on the table is better than no food on the table,” she said. “That’s the bottom line.”
Contact Natalie Kaufman at nkaufman@alligator.org. Follow her on X @Nat_Kauf.
Natalie Kaufman is a sophomore journalism student and the Alligator's Fall 2024 Metro General Assignment reporter. In her free time, she likes drinking copious amounts of caffeine and running.
