CSPI survey reveals consumers keenly interested in nutritious options at dollar stores

27 Oct 2023 --- A recent US-based study conducted by the Center for Science in the Public Interest (CSPI) in low-income neighborhoods near dollar stores highlighted customers’ gratitude for these stores’ presence while also underscoring their interest in healthier product choices. Overall, these findings evidence significant demand for a more health-conscious dollar store model with broader offerings of fruits and vegetables.

“The CSPI survey found a clear business case for healthy food expansion at dollar stores, including increasing current customer purchases and acquiring new customers,” Dr. Sara John, senior policy scientist at CSPI, tells Nutrition Insight.

“Corporate dollar stores should prioritize this expansion in areas with limited food access as it makes business sense to prioritize markets that lack healthy food retailers, and it shows their commitment to their communities and customers that stand to benefit the most.”

In the inaugural nationwide survey, which gathered responses from 750 participants, 74% suggested that these stores should increase their stock of healthier products, and the same percentage felt that better marketing of these options could be beneficial. People receiving SNAP call for nutritious food and beverage choices in dollar stores.

Low-income consumers crave healthier
The report highlighted several key findings, indicating that participants generally held positive views about dollar stores. Convenience, affordability and the availability of specialty items were cited as primary reasons for choosing these stores.

However, concerns about product quality, limited product availability, store appearance and staff interaction deterred others from becoming customers.

Purchasing food at dollar stores was considered less important than big box stores and supermarkets. However, for shoppers relying on the Supplemental Nutrition Assistance Program (SNAP) — which provides food benefits to low-income families — dollar stores played a more substantial role in their grocery shopping experience.

People receiving SNAP benefits strongly advocate for the expansion of nutritious food and beverage choices in dollar stores.

“Since most dollar stores are SNAP-authorized, by strengthening federal SNAP retailer stocking standards to require more healthy items, SNAP-authorized dollar stores would stock more healthy items nationwide, benefitting SNAP participants but also anyone who shops at a SNAP-authorized dollar store,” John says.

Barriers to implementation
John identifies four possible challenges highlighted in the CSPI survey report for stores aiming to make changes based on the latest consumer perception insights.

“Dollar stores occupy small buildings relative to other food retailers. Increasing the stock of healthy foods necessitates eliminating currently stocked items or occupying larger building space. Adding fresh foods also requires infrastructure changes like more refrigerators and freezers,” John stresses.

“Secondly, the dollar store model aims to provide the lowest possible prices by keeping costs low. This includes stocking with a limited assortment approach (i.e., stocking only the best-selling products), maximizing buying synergies and minimizing marketing and markdowns.”

Thirdly, John identifies that increasing fresh food availability at dollar stores would necessitate added complexities to the supply chain, including more frequent deliveries and regional distribution centers.

“Lastly, many healthy foods have shorter shelf lives than less healthy, ultra-processed food items. Dollar stores help minimize their shrink, or loss of product inventory, by stocking limited perishable items and would have to adapt current practices to stock more healthy foods without negative implications for food waste or business bottom line.” CSPI advises corporate dollar stores to pilot and evaluate nutrition-promoting strategies.

CSPI advises corporate dollar stores to pilot and evaluate nutrition-promoting strategies.

New dollar store model
Despite the obstacles, the recommendations provide numerous solutions that could enable the emergence of a new, health-conscious dollar store model.

“Increase demand for healthy perishable items, including by increased marketing or prominent placement of healthy items, offering discounts on fruits and vegetables purchased with SNAP benefits and working with the Special Supplemental Nutrition Program for Women, Infants and Children at dollar stores,” advises John.

She asserts that corporate dollar stores can pilot and evaluate nutrition-promoting strategies, like piloting fresh foods at more stores. For instance, she recommends that Dollar General should try to keep 16% of its stock consisting of fresh fruits and vegetables. Meanwhile, budget supermarket concepts like DG Market could feature a wider array of healthier perishable items.

Alongside these food and nutrition targets, the CSPI report recommends annual reporting on environmental, social and governance priorities.

John argues for their necessity, explaining that by making “specific, measurable, time-bound and meaningful” public commitments to improving healthy food access, corporate dollar stores would still be held accountable for their progress toward these goals.

“CSPI would be delighted to partner with corporate dollar store chains and researchers to evaluate the implementation and impact of policies passed and voluntary corporate actions,” she concludes.

By Milana Nikolova

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