The US discount store giant 99 Cents Only has declared bankruptcy, closing 371 stores and laying off 14,000 employees.
On the eve of the closure, many people rushed to the supermarket to queue up and empty the shelves in an instant.
Dollar Tree, another discount giant, has lost $12 billion in the past three months and recently announced it would close about 1,000 stores.
These two solid discount store old stores, one declared bankruptcy, a large-scale closure of stores, seem to have come to a difficult time.
Is the $1 discount store model a gold mine or a curse?
In the United States, opening supermarkets, Wal-Mart is an inescapable competitor.
But the discounters are one of the few survivors to compete with Wal-Mart.
Ninety-nine Cent supermarkets was founded in 1982, when the United States had just experienced a wave of economic crisis and people were tightening their belts.
Most of the products sold in the 99 US branch are only 99 cents, including daily necessities, fresh vegetables, food, etc., which has become the life security of low-income people in the United States.
For these people, going to discount stores is not a game, but a necessity.
Discount stores can make a profit even though their prices are cheap.
In 1996, 99 Cents went public and the founder became a billionaire.
Four years after the $99 store opened, Dollar Tree, another former grocery store, has taken a fancy to the discounters.
They took the initiative to convert their grocery stores into dollar stores, which mainly appealed to low - and middle-income groups, and successfully captured the market.
Dollar Tree chose a location close to Walmart to capture foot traffic and expand its visibility.
From 1996 to 2004, Dollar Tree grew from 888 stores to 2,735 stores in 48 states, becoming the first dollar store chain in the United States.
During the 2008 financial crisis, Dollar Tree bucked the trend and soared to more than $4.6 billion in revenue, becoming one of the top 500 companies in the United States.
The rise of discount stores has forced big brands such as Procter & Gamble and Colgate to lower their posture.
However, the two giants have now declared bankruptcy or closed stores.
The interim CEO explained the reasons for the bankruptcy, including the impact of the pandemic, changes in consumer demand, rising theft, and inflationary pressures.
These direct effects cause discounters to lose their biggest value anchor: cheapness.
Before the bankruptcy, some prices at $99 stores had risen, and Dollar Tree announced it would charge more items above $1.
Even many communities have turned against the expansion of these bargain store chains, opting to preserve jobs for local businesses and employees.
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