Walmart Beats Dollar General on Grocery Prices

Dollar(s) Stores

It’s been a while since you could get anything for a dollar at dollar stores. Even so, many consumers assume chains like Dollar General (DG) and Dollar Tree (DLTR) remain low-cost leaders. But a new study by Bank of America (BAC) found that, when it comes to groceries, better savings can be found elsewhere.

Several other stores offer better prices for groceries, including Walmart (WMT), Target (TGT), and Aldi. Many shoppers are becoming more price-sensitive as food costs have risen over 10% for the 12-month period ended February 2023.

Knowing where the best value can be found could help stretch your dollars further.

Inflated Dollar

The study looked at the cost of a basket of products, along with how much retailers hiked prices over the last three years. The findings were based on a selection of groceries items available in Dallas, Texas at a variety of stores, including Dollar General, big box retailers, and others.

Dollar General compared unfavorably by both measures. Prices at the chain rose 36% in the three-year period — higher than any of the other stores included in the study. By comparison, across all retailers, costs were up 22%. Food inflation for the same period came in at 21%.

Big Box Savings

A basket of 33 core consumer goods at Dollar General rang up at $201.14. A similar selection cost $194.15 at Target and just $187.50 at Walmart. What’s more, the analysts noted several items at Dollar General had a lower cost advertised on the shelf than the price charged at the register.

Given broad-based inflation, consumers seeking budget-friendly options continue to look for ways to save. Many have understandably turned to dollar stores — but this study suggests consumers may want to rethink that strategy.

Instead, consider replacing name-brand items with store-brand products, buying in bulk, or comparing prices from store to store yourself. These savings strategies may not be as simple as stopping by a store with “dollar” in the name, but they may cost you fewer dollars long-term.

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