Dollar-stores overcharge customers while promising low prices

an interesting contrast that i think about a lot:

- in rural america, there are dollar stores everywhere that overcharge for small items. people treat them as a necessary evil and begrudgingly shop there.

- in nyc, there are corner bodegas everywhere that overcharge for small items. they are generally seen as beloved neighborhood institutions.

so... what's the difference? corporate owned vs family owned? length of time in community? presence of cute cat at the register?

Once upon a time I lived near the Prague city centre, and if the intent of such a corner shop is to rip off tourists and one-time visitors, the locals don't mind - at least as long as cheaper alternatives off the most notorious areas exist and are usable for them (Lidl etc.)

Quite to the contrary, the locals are sometimes happy to have such overcharged options at hand, for example if they are throwing a party and find out that they are short on vodka+cigs, and it is 1 am and all the regular shops are closed.

Bodegas charge you a little bit more because a real human owner accepts the risk of serving a small community in exchange for being part of that community, and you pay that extra in order to make their existence possible.

Dollar Generals charge you a little bit more because a huge chain has driven out all the competition and you have no choice. The people who work there do not benefit from the extra you pay, and the owners are not members of the community.

Probably „only store that’s in my vicinity“ in rural areas vs. „if that bodega sucks, I go to another“. So one is a necessity which overcharges, the other a convenience which overcharges.

In both cases they charge a little more because the next store charges a little more too.

Because in NYC I pass by tens of the bodegas on the way to work and I can shop at any one of them. I can also shop at Aldi’s, Trader Joe’s, Costco, what have you.

You said it well yourself - “begrudgingly”. With so many options and price points, I don’t have to begrudgingly shop at bodegas. I do it happily if it serves my goal of getting a single can of Coke. If I want to get a whole stack of them, I’d happily get them at Costco. Options are great when you have them.

There was no competition in many places dollar stores operate. They moved into those places specifically because they were underserved by larger retailers.

Minimum wage in NY is $15.50, in Kansas it's $7.25. The overcharging in rural areas is not adjusted downward for lower wages. But I wouldn't shop at a bodega and don't find it virtuous there either.

This article is about something subtly different than overcharging: it's about consumers believing that they're paying one amount (the list/sticker price), and being charged a different amount (typically higher in the company's favor) at checkout.

In my experience, this doesn't really happen with bodegas: they might be overpriced in the "this is a bad deal for milk" sense, but they don't misrepresent their sticker prices to any degree that I've ever experienced.

(But also, I don't think bodegas do categorically overcharge in NYC. I think they're about the same as grocery stores, i.e. there's a large amount of internal variation in pricing because people generally don't want to make multiple bodega pit stops just to save $2.00 on eggs.)

Hey, Starbucks charges $3.50 for a cookie, I could buy 4 at the local bakery or two at the farmers market for that much (and get a better cookie).

I agree, at least in my area.

Two neighboring dollar stores just went out of business in a town I commute through. The culprit? A new Harp's grocery store a block away.

The dollar store in my town is barely holding on - the competition? A Walmart across the street.

The only thing keeping it afloat is literally balloons I feel. Walmart doesn’t sell helium inflated ones.

>Hey, Starbucks charges $3.50 for a cookie

No, that's not what the article is about.

"Starbucks has a sign saying the cookie is $3.50. You are charged $5 at the counter".

That is the infraction here.

Ehh I disagree. "No competition" yet I bet every home in the area still had groceries in the kitchen before the dollar general opened.

Not really sure where your examples or experiences come from, but the majority of rural people that I know love most of their dollar stores.

> what's the difference?

Did you read the article? Charging what's actually on the price tag is the first thing that's the difference.

Sure. Because they were driving 25 minutes each way to the nearest Walmart to do their shopping, not 5 minutes down the street.