Some people say it's trickery, but when I apply the razor I find pricing errors more likely to be the result of stupidity than of malice.

Having worked in retail myself, I understand that some days there just isn't time to get it all done. A debt of unfinished tasks can accumulate. It happens. Sometimes old prices get left up. (I think the stupidity is on the part of management more than it is the employees, but it's still more stupid than it is malicious.)

---

Dollar General got into the thick of it with the Ohio Attorney General a couple of years ago[1] over this issue: The prices on the shelf didn't always match the prices at the register. Stores were closed[2] while they updated their price tags to match reality.

And as part of the settlement with the Ohio AG: Nowadays, when I go into a Dollar General and Red Baron pizzas are on the shelf for $5 and they ring up at $7.65, they're required to honor the posted price of $5 when I bring this up to them.

(That last bit really should be enshrined in law instead of the footnotes of a legal settlement with a single entity, but alas: It just isn't that way in Ohio.)

[1]: https://www.ohioattorneygeneral.gov/Media/Newsletters/Consum...

[2]: https://www.supermarketnews.com/foodservice-retail/ohio-ag-d...

>> Red Baron frozen pizzas, listed on the shelf at $5, rang up at $7.65.

The crazy thing is that even if it did ring up at the correct price it isn't a good deal. It's around $4.80-4.90 at Walmart and Target and others.

It was investigated, the issue is that the fines are smaller than the profit. I would personally want to see things like this considered fraud and that it can result in prison sentences for executives and other people invovled in the decision making.

This is very American: it's illegal, but everyone accepts both that the law will be enforced very unevenly, and that this kind of thing doesn't get solved by the regular political process. There's no political consumer complaints culture, it's seen as an individual matter.

You couldn't get away with this for as long in the UK as a retailer. Either the CMA or Trading Standards would deal with it.

It was investigated. They got fined $5k. 4 times.

Is there another law that can get them for repeat abuse.

> Left unsaid is that both Dollar General and Family Dollar would become unprofitable if they stop tricking customers. (Both companies typically earn only 3-4% on sales.)

They could of course show the actual prices instead of tricking customers?

If the margins are so low nobody else will be significantly cheaper anyway.

Has private equity ever done anything good for anyone outside of the investors?

And this is exactly why I only shop at Costco. While other retailers try to get me to buy more stuffs, Costco try to make sure I'm satisfied enough that I'll renew my yearly membership (their main profit source). The incentive structure aligns very well.

> Dollar stores are private equity with a checkout lane.

Dollar Tree and Dollar General are publicly traded.

So Family Dollar might be the result of PE tactics, but the other two aren't, and Dollar Tree sold Family Dollar because they saw it as under-performing.

It's actually sort of weird Dollar Tree couldn't make it work. I know the dollar stores all have somewhat different businesses, but you'd think that Dollar Tree could have either turned Family Dollar around or knew it was selling a loser (see the market for lemons) to PE.

The sad thing is, people in rural areas that depend on places like Dollar General, and are getting fleeced blame everyone but republicans and they are usually in red areas

> They already run on a thin-staff, high-volume model.

Like every other retail business not targeting the top 5%.

And Dollar Tree and Dollar General are both publicly listed companies, not private equity.

Dollar Tree sold Family Dollar for $1B 10 years after buying it for $8.5B, a pretty big loss. Dollar Tree’s market cap is $25B, so a pretty negligible part of the national dollar store business is “private equity”.

> cosplaying as poverty relief

Does it really? Who says this, and who believes it?

Interesting. The Netherlands is no class society so rich or poor nobody has any goddamn shame to stand in line at the Action checkout if there's a good sale to be had.

Seeing people in BMWs at the Aldi parking lot. Strange country.

private equity is a tumor on this country. it seems any business stained with this actively becomes worse for the customer for as long as possible.

Then why doesn't some other established brand open in the same area and undercut them?

Kudos! This is beautifully succinct, elegant, and accurate writing.

I am not an attorney, but given that Dollar General and Family Dollar are highly likely to serve a much larger percentage of SNAP-eligible customers, isn't there a far more serious FEDERAL crime being perpetrated here of retailer abuse and fraud in the Supplemental Nutrition Assistance Program (SNAP), often referred to as food stamp fraud? That is, if the SNAP customers have no other means of purchasing food (living in a food desert), and the retailer is intentionally charging more for food items, isn't the retailer committing fraud against the US government?

It looks like North Carolina’s previous Weights & Measures law was entirely criminal. So in 1991 they added civil powers, but curtailed the fines.

The solution here appears to be less in raising the civil fine and more in criminally investigating, to start with, the store manager [1].

[1] https://www.ncleg.gov/enactedlegislation/statutes/html/bycha... § 81A-30.1

Unfortunately, this type of conflict can only be adjudicated by courts, which low-income people don't have the time and money for. You couldn't just walk out of the store with the items. You'd need to either:

1. Buy the items and sue.

2. Take the items without paying, likely get the police called on you, and defend yourself in criminal and civil court.

Not only that, but they post a sign about this at every register. (That must be required.) So you can point to the sign. I think a typical store manager would comply. Maybe I'm not cynical enough.

Yup. My local Star Market was pretty bad about this, so I started paying close attention to prices on the shelf and at the register. Pretty soon I was taking home free items every shopping trip. (I also reported them to Inspectional Services when aisle scanners were broken or prices were particularly egregiously missing or wrong.)

Some of the cashiers had to have it explained to them with much pointing to the sign that hangs on every register; others knew the drill and called a manager over right away.

After about 6 months they started shaping up. Maybe the store manager got fed up, or maybe corporate stopped having them skimp on sticker hygiene.

From the article:

> In one court case in Ohio, Dollar General’s lawyers argued that “it is virtually impossible for a retailer to match shelf pricing and scanned pricing 100% of the time for all items. Perfection in this regard is neither plausible nor expected under the law.”

...but in my experience, they're perfectly capable of doing the right thing, given appropriate incentive and enforcement. In particular I noticed that this really varies from store to store, even in the same chain.

So this means I would get the app-only sale price, without using the app?

While doing some research into state retail pricing laws a few years ago, I discovered how tough Massachusetts is, being one of the last holdouts mandating ticketing on all items, and only relenting in exchange for price scanners every so many aisles. Living in Pennsylvania and annoyed by stores tying their best prices to their apps, I fancifully emailed Elizabeth Warren, asking if she'd prod a friend in state government to consider a legislative end run around apps. I had no idea such a law really existed. "First in the nation" I expect. Wonder how long it's been around?

I can’t help imagining that the likelihood of successfully arguing for a free product with a DG cashier is slim to none.

You need to think like an owner/operator to understand why you would defer to the system.

It’s to prevent employees from stealing. To “defer to the tag” requires a manual price override of some sort, which becomes an abuse vector.

Requirements about surcharge notifications and displaying all-up prices are nice, but the gap here will still be about enforcement and not regulation. The core problem for dollar-store shoppers in the US is about getting the retailers to honor the sticker price, not whether the sticker price shows all state and local taxes.

Is the Australian shopper protected simply by a stronger culture of adherence amongst retailers or is it because regulators inspect more often and take stronger action against failures?

Depending on how much independence the inspectors have they could probably turn a heck of a profit per inspector (thus being able to argue their continued existence to the legislature).

Could an inspector manage two per day? If you figure the full cost of each inspector is $150,000/year but dedicated ones could do 8 inspections at $5k each per week, there's well over $1 million/year per inspector (assuming not all inspections would be the full fine, there's travel costs per inspector, inspectors would have to spend some office/court time, etc. that would bring it down from the potential maximum of ~$1,800,000 each factoring in vacation and holidays).

Even Republicans could get behind it! "We're reducing the direct budget of the department, but authorizing it to hire additional inspectors in order to bring in additional revenue that can be utilized to bring the budget to or above its current levels." It's a cost reduction measure!

It’s not regulatory capture unless the regulatory body itself is controlled by shady grocers. This is just garden variety insufficient regulation. Although if they inspected every day it would probably still be profitable for the state.

Say what you will about the EU, but they figured out how to scale corporate fines correctly: max 10% of owning entities annual income.

Seems like it actually creates an incentive to go big or go home. If you're already going to be busted and hit with the maximum fine, might as well have even larger mispricings, so you come out ahead after the fine is taken into account.

What this calls for is an Amazon-style optimization of inspections. Given X inspectors and Y locations, what is the most optimal routing to optimize for coverage and penalty collection?

> yet North Carolina law caps penalties at $5,000 per inspection

So, have every agent in the state inspect them. Fine 5k. Immediately inspect again, different goods. Fine another 5k. Keep doing it opening hours.

Treat them like an inspection money piñata until they fix their ways. State gets a big pile of money to do better, and massive fines at 5k a pop for a few weeks punish the company and their bottom line.

I don't know NC law. Does it have an "invitation to treat" practice there where prices marked are a customer relations issue rather than a legally-binding offer?

To attain change, enough people have to:

1. Correctly identify the source of their misery, because it ain't [insert scapegoats].

2. Find others who agree with them.

3. Make a plan for effective countering of 1.

4. Use intestinal fortitude and endure temporary setbacks to achieve 3. to overcome 1.

5. Prevent 1. from ever happening again structurally, culturally, and through vigilant participation.

The 0th problem is the political operating system is captured by criminals and power has centralized grotesquely in ways that defeat the fundamental function of separation of powers. All elected officials corrupted by lobbyist bribes need to face accountability and have a code of ethics and integrity, because continuing down this path is the road to ruin.

America The Beautiful

Regulatory capture is when a large company encourages stronger regulations that small competitors cannot afford to satisfy. Here the issue is regulation that is too weak, not too strong.

While that can be bad, sometimes you come out ahead after accounting for spoilage, time, and travel.

Sometimes I pay higher unit prices at a dollar store intentionally because they offer smaller package sizes not offered elsewhere and I only need the smaller amount. I could get a much better unit price at another store but would waste the rest of the product.

The "dollar stores" vary.

I've been able to find good deals on some things at Dollar Tree. Usually the good deals were a smaller quantity of a normal-quality brand-name item. I mostly avoid the substandard quality items. But even sometimes substandard is OK if, say, you want to make your political demonstration sign on white foamcore (much cheaper than the art supply store, and you don't care if it's smaller, thinner, or outgassing) rather than on an Amazon shipping box.

There was a Family Dollar across from a large public housing project here, where I also went looking for deals, but the shelf prices looked like a convenience store. I didn't find out whether they were fraudulently charging even more at the register like this article describes. (I hope it closed because the residents knew there was an affordable Market Basket a 20-30 minute walk away, over the city line and train tracks, and they were able to get there and find the time for it.)

I lived for an entire year out of just Dollar General and Dollar Tree. In some rough areas they are the only stores where you can buy groceries, so they have very clear monopolies. There are good value products, and like everything these days you have to use their apps to get the best offers. Also, the Dollar General app lets you check the price of everything before you take it to the counter. They regularly have items marked up at 1 cent.

Saying it only targets the vulnerable because of high unit prices is like saying the local gas station is a rip off that only targets the vulnerable because prices are higher.

I lived in a city that’s in North Metro Atlanta (Johns Creek) where the median household income was $160K. There was a Dollar General right by a Publix. People still went in the Dollar General for little things where the small packages that you could buy was feature and not a bug.

We still stop by the dollar store for snacks sometimes because it is convenient just to get things to pack for a flight. It’s especially popular for tourists in Orlando where I live

time value of money

we don’t complain that the per unit cost at target is higher than at costco

Have you ever been to a dollar store? Its much cheaper for the same items than a regular grocery store. Also not everyone needs a Costco sized tub of mayo. You test it yourself go by a standard sized candy bar at safeway/alberstons and then at a dollar store. Bottle of coke. Birthday card. Better yet compare the cost spices. Try to buy bay leaves at regular grocery store for under $5.

People usually understand this, but realize driving 10 minutes to dollar tree for a few items is preferable to driving 30 minutes to cheaper shop

> The list price is low but the per-unit price is astronomical compared to grocery store prices.

The problem is, so is material cost and handling effort. Say, a 2 liter bottle of soda compared to 10x 200 mL. Same amount of soda, but more handling required for stocking, inventory management (aka, make sure there is no soda expiring on the shelf) and finally scanning it over the cash register, and more packaging material.

Larger units of anything will always be cheaper than small units.

Yup. Dollar General is worse than a convenience store like 7-11, it's an expensive inconvenience store.

And we need more local co-op grocery stores like Berkeley Bowl, the Davis Co-op, and ATX Wheatsville.

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.)

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.

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).

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.

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.

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.

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

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.

That is already ludicuously complex. Designed by Kafka so you give up.

Same. My city has a Walmart, Publix, Food Lion, Kroger, and Aldi. Yet they keep building dollar stores, I think there's now 5 within 10 miles of my house. They all seem to do decent traffic, which baffles me. The stores are a mess, items disheveled everywhere, and rare to see more than a single person working. Really depressing places, I cannot figure out their appeal.

Every store has some stuff that is overpriced compared to peers and some stuff that is underpriced. Dollar stores make their money more on drastic understaffing (leading to the issue in the article) and national scale than they do on being a consistently worse value. They have the cheapest freeze dried strawberries by weight you can get anywhere other than making them yourself.

I think that's deliberate: you walk into a dollar store and think "they aren't spending a dime on the shopping experience, so they must be passing that dime onto me."

I have a very, very convenient Walmart including a pharmacy so I do go in from time to time especially for standardized purchases. But I don't really like it. And I poked my head into an adjacent Aldi once and retreated. Otherwise not really worth the headache.

The disastrous Target Canada (iirc) was similar; obviously nobody cared at all.

Publix in the southeast US will give you anything that rings up wrong for free. I shopped there for 20+ years and only remember getting a handful of things free.

This is like cheating in a golf match against a professional and then saying "I got the same score as my opponent, I am not the villain here".

You can find a poor me for almost any corporation to excuse their ripping people off.

What does their margin have to do with anything? Or, what things do you think they should and shouldn’t be able to do given their low margins?

Their returns (margins are irrelevant) are usually lower than grocery stores. Large retailers will turn over their inventory tens of times a year, dollar stores won't so the returns are typically lower.

For some reason, left-wing journalists turn into law of one price zealots when confronted with this issue. The reality is that these locations have low-volume and stores everywhere are relatively expensive to run now. For some reason, journalists get angry at the company rather than people who control how much it costs stores to operate. I mean local governments in the US had no problem accepting Dollar General's sales tax from their poor constituents shrug probably more than the corporation is making from the store.

I live in the UK and there is a store like this, Co-Op. The Guardian finds it easier to blame evil foreign corporations because the Co-Op has much higher prices but is a non-profit so the narrative of the evil corporation crumbles.

Not charging the best-advertised price is dishonest. It might also be in customers' best interest if the cost of keeping consistent price data on low-margin items costs more than whatever the inconsistency is. Or the answer might be that dollar stores sell too wide of a variety too cheaply on too low-margin product to play supermarket-style pricing games effectively.

Just because your margins are low doesn't mean you still aren't screwing over poor people.

Yeah, queue the HN fake outrage about big companies and their C-Suite who are billionaires on the backs of the little people. So predictable.

Fact is, Dollar General and similar stores provide a real value to people who live in rural areas. Yes, their prices may be higher for some goods, but that is the price you pay for the convenience they provide. People are free to drive another 20mins to a WalMart or another store to save $0.50 for the same can of corn or loaf of bred. And, people who are really on a budget actually scrutinize the register receipts to make sure they are paying the price listed on the shelf. They can immediately bring up the discrepancy to the staff.

I am convinced the wallmarts in Canada are doing dynamic with the eink price tags. I was in the same location twice in a week to pick up snacks for a gathering and the price of chips were 50% more on the Friday vs earlier in the week.

An easy test for this is how often the price at the register is higher vs lower than the marked price. If it's close to 50%, then ok, it's a mistake. But if it's higher...

I used to work at Best Buy replacing pricing stickers before the store opened. We had a sheet of new stickers for changed prices every time and had to scan every sticker in the store to make sure they were all up to date.

It makes sense they’re all switching to e-ink tags though, probably saves a ton in labor and the occasional mistake.

It’s virtually impossible for them because they’re not considering hiring more people to do it.

Dollar General stores often run with one overworked staff member doing everything in the store, from stocking to working the register (which is why the register is unstaffed so much and you have roam the store to find someone to ring you up…)

Just make the sticker price legally binding and this issue would be solved with almost perfect precision.

Dollar General: "people these days just don't want to work (meaning, my clients don't want to do that work or pay lazy genZers...)!"

> When on earth did we get into a world where that absolutely fundamental most basic task is now too burdensome to do with accuracy?

It always has been this way since barcoded stock keeping units because of the problems identified by CAP Theorem [0]. Since the price data of an object must exist in two locations, shelf and checkout, the data is partitioned. It is also relatively expensive to update the shelf price since it depends on physical changes made by an unreliable human. Even if all stores used electronic price tags there will a very small lag, or a period in which prices are unavailable (or a period of unavailability like an overnight closure).

It would be interesting to understand at what point of shelf/checkout accuracy would lead to what increases in overall prices [1]. That is to say that pricing information has a cost: a buyer must bring the item to checkout to find out the true cost in the case of authoritative checkout, or the clerk must walk to each shelf in the case of authoritative shelf.

Once upon a time, each item in the store was labeled with a price tag and the clerk typed that tag into a tabulation device in order to calculate tax and total. The advent of the bar code lead to shelf label pricing since the clerk needn't read a price from each item, leading to the CAP Theory problem of today.

I suppose that the future will bring back something similar to individual price tags in the form of individual RFID pricing. This way each individual item on a shelf can be priced in a way that is readable by the buyer and the seller in the same manner.

0. https://en.wikipedia.org/wiki/CAP_theorem

1. https://en.wikipedia.org/wiki/Pareto_efficiency

"the default is a dollar"

There is no default price.

We might also acknowledge that a pretty significant share of people do know that already and just shrug their shoulders to it, convinced that it's better to allow for that than do anything about it.

There's been a lot of work put into distilling "free market" into its most radical interpretation, and lots of people just aren't open to bringing much nuance or pragmatism to bear upon it any more. Many lessons learned painfully in late 19th and early 20th century have been forgotten and the counterweight and containment policies that they earned now tend to get ignored or dismantled.

And somehow instead of trying to make it better, there are never ending attempts to make it even worse somehow ( if some of the patents are to believed ). I honestly sometimes wonder if some of the stuff is not in place already only because public reaction if all those were plopped in place in one go.

Well, why don't the ethical non-predators open up shops in economically disadvantaged areas and offer non-predatory prices? The margins must be huge if they really are predators.

Always has been.

Yeah. Why do I have to pay a plumber to install gas appliances? It's just a protectionist racket.

Point is, it's easy to screech "predation" or whatever but the problem is that every one of these things has some justification that can be used in the abstract.

It does legitimately cost more to run a store like Dollar General than Walmart so the same can of beans has to cost more on their shelf for the same margin.

How much more, how much is justified? I don't know.

If it says $4 on the shelf and you pay $4 at the register and walk out with the goods, that's a 100% legal sale and not theft. Not even if it was a mistake on the part of some employee (and it's not the employee's fault either, by the way)

Yes, being poor is expensive and people just don't seem to grok that

Take energy. I'm not rich but I'm comfortable, my energy is paid for in an efficient way, I can shop around easily for the best rates for my lifestyle and so on. But if I had no money they'll fit a pay-per-use meter, they charge more money to fill that meter, if I can't fill it or forget to then the power goes out - and it's inconvenient to use it.

Years ago now I had a dispute with the water utility. I refused to pay, so, they eventually concluded that fixing their error was too difficult so they just created a new account starting from zero and wrote off all the costs for the disputed period entirely. If I'd been poor, they'd have threatened to cut off the supply (they're only threatening, fortunately it's not actually legal here to cease supplying clean water to poor people like they're not even animals) and sent scary people to demand payment.

> are often selling lower-quality versions of the products they sell

Clothes brands do this too.

Clothes at the outlet store aren't the same as clothes at Dillards, what's stocked at a struggling Macy's in a relatively poor area may be different from what's available for the same brand at Macy's in Manhattan, and all that may not be the same as what's in their flagship stores.

Sometimes they make it semi-obvious provided you learn their secret label language (Polo by Ralph Lauren, Chaps by Ralph Lauren, Ralph Lauren Purple Label, and about a half-dozen other major variants, for example). They do this so they can sell shit to unsophisticated consumers at a large mark-up for the name, riding on the reputation and clout of the good versions of what they sell (elsewhere, at even higher prices).

I don’t think this is true. Even if pricing in the shelves is accurate, in my experience Dollar General is typically a little more expensive than a normal mid-range supermarket (or e.g. Amazon) for most things.

Is it a hit piece if it’s true lol?

What a rude, dismissive comment about a very real issue affecting real people.

Can you? I think the implicit counterclaim in TFA is that other supermarkets/stores don't fail state pricing inspections nearly as often. If you have evidence/articles showing that TFA has cherry-picked dollar stores for criticism, that would be helpful to share.

Those prices aren't because of tax; even the highest sales tax wouldn't cause $10.99 paper towels to ring up as $15.50.