Discount store

Last updated

Discount stores offer a retail format in which products are sold at prices that are in principle lower than an actual or supposed "full retail price". Discounters rely on bulk purchasing and efficient distribution to keep down costs. [1]

Contents

Types (United States)

Discount stores in the United States may be classified into different types:

Hypermarkets (superstores)

Discount superstores such as Walmart or Target sell general merchandise in a big-box store; many have a full grocery selection and are thus hypermarkets, though that term is not generally used in North America. [2] In the 1960s and 1970s the term "discount department store" was used, and chains such as Kmart, Zodys and TG&Y billed themselves as such. [3] The term "discount department store" or "off-price department store" is sometimes applied to big-box discount retailers of apparel and home goods, such as Ross Dress for Less, Marshalls, TJ Maxx, and Burlington.

Category killers

So-called category killer stores, specialize in one type of merchandise and sell it in big-box stores. Examples include:

Warehouse clubs

When membership is required, discount superstores are known as warehouse clubs, and often require purchases of larger sizes or quantities of goods than a regular superstore. The main national chains, both of which have operations outside the U.S., are Costco and Sam's Club.

Discount grocery store

Major discount grocery store retail chains in the U.S. include Aldi, Lidl, Save-A-Lot and Grocery Outlet. [4] Currently Aldi and Lidl are the largest discount retailers in the world operating more than 25,000 discount stores worldwide between them. [5]

Variety stores, dollar stores, five and dimes

Variety stores in the U.S. today, are most commonly known as dollar stores such as Dollar General, Family Dollar and Dollar Tree, which sell goods usually only at a single price-point or multiples thereof (£1, $2, etc.). During the early and mid-twentieth century they were commonly known as "five and dimes" or "dime stores". Stores of the main chains, Woolworth's, J. J. Newberry and S. S. Kresge, lined the shopping streets of U.S. downtowns and suburbs, and starting in the 1950s they also opened branches in shopping malls. These chains originally sold items for 5, 10 or 25 cents, but many later moved to a model with flexible price points, with a variety of general merchandise at discounted prices, in formats smaller than today's discount superstores.

History

United States

During the period from the 1950s to the late 1980s, discount stores were more popular than the average supermarket or department store in the United States. [ citation needed ] There were hundreds of discount stores in operation, with their most successful period occurring during the mid-1960s in the U.S. with discount store chains such as Kmart, Ames, Two Guys, Gibson's Discount Center, E. J. Korvette, Mammoth Mart, Fisher's Big Wheel, Zayre, Bradlees, Caldor, Jamesway, Howard Brothers Discount Stores, Kuhn's-Big K (sold to Walmart in 1981), TG&Y [ citation needed ] and Woolco (closed in 1983, part sold to Wal-Mart) among others. [6]

Walmart, Kmart, and Target all opened their first locations in 1962. Kmart was a venture of S. S. Kresge Company that was a major operator of dime stores. Other retail companies branched out into the discount store business around that time as adjuncts to their older store concepts. As examples, Woolworth opened a Woolco chain (also in 1962); Montgomery Ward opened Jefferson Ward; Chicago-based Jewel-Osco launched Turn Style; and Central Indiana-based L. S. Ayres created Ayr-Way. J. C. Penney opened discount stores called Treasure Island or The Treasury; Sheboygan, Wisconsin based H. C. Prange Co. opened a chain of discount stores called Prange Way, and Atlanta-based Rich's owned discount stores called Richway.

During the late 1970s and the 1980s, these chains typically were either shut down or sold to a larger competitor. Kmart and Target themselves are examples of adjuncts, although their growth prompted their respective parent companies to abandon their older concepts (the S. S. Kresge five and dime store disappeared, while the Dayton-Hudson Corporation eventually divested itself of its department store holdings and renamed itself Target Corporation). [ citation needed ]

In the United States, discount stores had 42% of the overall retail market share in 1987; in 2010, they had 87%. [7]

Many of the major discounters now operate "supercenters", which adds a full-service grocery store to the traditional format. The Meijer chain in the Midwest consists entirely of supercenters, while Wal-Mart and Target have focused on the format as of the 1990s as a key to their continued growth. Although discount stores and department stores have different retailing goals and different markets, a recent development in retailing is the "discount department store", such as Sears Essentials, which is a combination of the Kmart and Sears formats, after the companies' merger as Sears Holdings Corporation.

Canada

Woolworths entered Canada in the 1920s, the stores were converted to the Foot Locker, Champs Sports and other stores in 1994. Kresge's, a competitor to Woolworth's entered the Canadian market in 1929.

Zellers was founded in 1931, and was acquired by the Hudson's Bay Company in 1978. Giant Tiger opened its first store in Ottawa in 1961, modeled on Woolworths. Winners was founded in 1982 in Toronto, and sells off-price brand clothing. Costco entered Canada in 1986. In 1990, the American chain Walmart purchased the Woolco chain in Canada and converted the stores into Walmarts. Dollarama was founded in Quebec in 1992. In 1998, Zellers bought out Kmart Canada, taking over its stores.

In 2011, Marshalls, owned by the American TJX Companies, entered Canada, and Zellers sold most of its stores to Target. Target Canada filed for bankruptcy in 2015, selling its stores to Walmart, Lowe's and Canadian Tire.

In 2016, the Hudson's Bay Company started opening Saks Off 5th locations to sell off-price brands. American off-price chain Nordstrom Rack opened its first Canadian location in Vaughan Mills in 2018.

Transnationals

By country

Outside the United States and Canada, the main discount store chains listed by country are as follows:

Australia

Albania

Argentina

Austria

Angola

Belgium

Botswana

Bosnia and Herzegovina

Brazil

Bulgaria

Chile

China

Colombia

Costa Rica

Croatia

Cyprus

Czechia

Denmark

Greece

Guatemala

Ecuador

Egypt

El Salvador

Estonia

Eswatini

Finland

Tokmanni in Tampere, Finland Tokmanni.jpg
Tokmanni in Tampere, Finland

Germany

Major chains of discount supermarkets in Germany are Aldi, Lidl, Netto Marken-Discount, Netto (store), Norma and Penny.

Honduras

Latvia

Hungary

Ireland

Kenya

Lithuania

Luxembourg

Italy

Italy has numerous discount supermarkets, including Lidl and EuroSpin, the chains with the largest number of stores,[ citation needed ] and Aldi, Discount Dial, Dpiù, MD Discount, Penny, Todis and Tuodì.

Japan

Japan has numerous discount stores, including Costco, Daiso, Don Quijote (store) and The Price (owned by Ito Yokado).

Malaysia

Malta

Malawi

Mexico

Lesotho

Morocco

Mozambique

Namibia

Netherlands

Action, Euroland, Solow, Big Bazar and Zeeman. In addition, the German discount supermarkets Lidl and Aldi both operate in the country.

New Zealand

North Macedonia

Norway

Nicaragua

Peru

Philippines

Poland

ALDI in Tomaszow Mazowiecki, Poland The ALDI discount store at Rondabout of Olympians from Tomaszow, in Tomaszow Mazowiecki with a population of 60,000. The Lodz Voivodeship.jpg
ALDI in Tomaszów Mazowiecki, Poland

Discount supermarkets cover about 30% of food sales in Poland. Main chains include Biedronka, Lidl, Netto, and Aldi.

Portugal

Netto converted into Intermarché

Panama

Romania

Russia

Former

Serbia

Slovakia

Slovenia

South Africa

Spain

Sweden

Switzerland

Turkey

Ukraine

United Kingdom

Venezuela

See also

Related Research Articles

<span class="mw-page-title-main">Supermarket</span> Large format of grocery store

A supermarket is a self-service shop offering a wide variety of food, beverages and household products, organized into sections. This kind of store is larger and has a wider selection than earlier grocery stores, but is smaller and more limited in the range of merchandise than a hypermarket or big-box market. In everyday United States usage, however, "grocery store" is often used to mean "supermarket". The supermarket store format first appeared around 1930 in the United States as the culmination of almost two decades of retail innovations, and began to spread to other countries after extensive worldwide publicity in 1956.

<span class="mw-page-title-main">Kmart</span> American retailing company

Kmart, formerly legally registered as Kmart Corporation, now operated by Transformco, is a department store chain, and a current online retailer in the United States and its territories and operates five remaining Kmart big-box department stores — three in the US Virgin Islands and one each in Kendale Lakes, Florida ;and Tamuning, Guam.

<span class="mw-page-title-main">Variety store</span> Retail store that sells inexpensive general merchandise

A variety store is a retail store that sells general merchandise, such as apparel, auto parts, dry goods, toys, hardware, furniture, and a selection of groceries. It usually sells them at discounted prices, sometimes at one or several fixed price points, such as one dollar, or historically, five and ten cents. Variety stores, as a category, are different from general merchandise superstores, hypermarkets, warehouse clubs, grocery stores, or department stores.

<span class="mw-page-title-main">Aldi</span> German multinational discount supermarket chain

Aldi is the common company brand name of two German multinational family-owned discount supermarket chains operating over 12,000 stores in 18 countries. The chain was founded by brothers Karl and Theo Albrecht in 1946, when they took over their mother's store in Essen. The business was split into two separate groups in 1960, that later became Aldi Nord, headquartered in Essen, and Aldi Süd, headquartered in neighbouring Mülheim.

<span class="mw-page-title-main">Hypermarket</span> Big-box store combining a supermarket and a department store

A hypermarket or superstore is a big-box store combining a supermarket and a department store. The result is an expansive retail facility carrying a wide range of products under one roof, including full grocery lines and general merchandise. In theory, hypermarkets allow customers to satisfy all their routine shopping needs in one trip. The term hypermarket was coined in 1968 by French trade expert Jacques Pictet.

<span class="mw-page-title-main">Acme Markets</span> American supermarket chain

Acme Markets Inc. is a supermarket chain operating 161 stores throughout Connecticut, Delaware, Maryland, New Jersey, the Hudson Valley of New York, and Pennsylvania and, as of 1998, is a subsidiary of Albertsons, and part of its presence in the Northeast. It is headquartered in East Whiteland Township, Pennsylvania, near Malvern, a Philadelphia suburb.

<span class="mw-page-title-main">Warehouse club</span> Retail store offering merchandise at wholesale prices

A warehouse club is a retail store, usually selling a wide variety of merchandise, in which customers may buy large, wholesale quantities of the store's products, which makes these clubs attractive to both bargain hunters and small business owners. The clubs are able to keep prices low due to the no-frills format of the stores. They are distinguished from traditional cash-and-carry wholesale businesses in that their warehouses are substantially larger in size, and they do not cater purely to businesses but also allow some or all types of consumers to obtain memberships. They are also distinguished from warehouse stores in that they usually charge annual membership fees, and require presentation of proof of membership at the warehouse entrance and again at the point of sale.

<span class="mw-page-title-main">McCrory Stores</span> American store chain

McCrory Stores or J.G. McCrory's was a chain of five and dime stores in the United States based in York, Pennsylvania. The stores typically sold shoes, clothing, housewares, fabrics, penny candy, toys, cosmetics, and often included a lunch counter or snack bar.

<span class="mw-page-title-main">Big-box store</span> Physically large retail establishment

A big-box store, a hyperstore, a supercenter, a superstore, or a megastore is a physically large retail establishment, usually part of a chain of stores. The term sometimes also refers, by extension, to the company that operates the store. The term "big-box" references the typical appearance of buildings occupied by such stores.

<span class="mw-page-title-main">Bottom Dollar Food</span> Defunct American soft-discount grocery chain

Bottom Dollar Food is a defunct American soft-discount grocery chain. It was a subsidiary of Delhaize America, the U.S. division of international food retailer Delhaize Group. Its headquarters was in Salisbury, North Carolina.

<span class="mw-page-title-main">Netto Marken-Discount</span> German chain of discount supermarkets

Netto Marken-Discount is a German discount supermarket chain owned by the German supermarket cooperative Edeka Group, and operates mostly in the south and west of Germany. The company reached its 1000th store in 2004, then aggressively expanded to the 4000th store in 2009, making it the largest discounter in Germany.

<span class="mw-page-title-main">Coles Group</span> Australian public company

Coles Group Limited is an Australian public company operating several retail chains. Its chief operations are primarily concerned with the sale of food and groceries through its flagship supermarket chain Coles Supermarkets, and the sale of liquor through its Coles Liquor outlets. Since its foundation in Collingwood, Victoria in 1914, Coles has grown to become the second-largest retailer in Australia after its principal rival, Woolworths, in terms of revenue.

<span class="mw-page-title-main">Value Village</span> Chain of discount department stores

Value Village Stores, Inc. was a Midwestern U.S.A. chain of retail stores aimed at the discount department-store market. Henry Horney, formerly of F.W. Woolworth Company founded a small, regional chain of discount stores located in the two states of Wisconsin and Illinois that opened in 1961 and operated into 1989. Horney also had a real estate company and often built small shopping malls adjoining the discount stores. The chain had no relation to the Savers Value Village chain of thrift stores.

References

  1. Charles Lamb (1 Jan 2011). Essentials of Marketing. Cengage Learning. p. 465. ISBN   978-1133171904.
  2. "Walmart, Target, Kmart, Kohl's Lead 50 Years of Retail Revolution". adage.com. March 19, 2012.
  3. "Kmart History | Kmart | About Us | Transformco". transformco.com.
  4. "What is Lidl? Why this discount grocery store is giving Aldi a run for its money". TODAY.com.
  5. "¤ Aldi | Handelsdaten". Archived from the original on 2014-09-03. Retrieved 2014-08-27.
  6. Arkansas, Encyclopedia of. "Wal-Mart Stores, Inc.". Encyclopedia of Arkansas. The Central Arkansas Library System. Retrieved 8 February 2013.
  7. "America's top stores." 'Consumer Reports, June 2010, p. 17.
  8. "Bim A.Ş. > Welcome..." english.bim.com.tr. Retrieved 2017-08-21.

Further reading