(PCC)Don’t discount profits! It’s always beneficial to save money, but several groups are making big bucks on your thrifty shopping, and here’s how. Here is what the dollar store boom says about the U.S. economy, and it’s very interesting.

In a twist of economic irony, America’s most budget-conscious retailers are becoming increasingly popular with consumers who aren’t exactly strapped for cash. Dollar Tree and Dollar General, staples of low-income communities, are now seeing a surge in shoppers from households earning six figures. This trend is not merely a retail phenomenon, but rather a warning sign for the broader U.S. economy.

For years, dollar stores were associated with working-class Americans looking for the best deals on everyday essentials. But that customer profile is shifting. During recent earnings calls, both Dollar Tree CEO Michael Creedon and Dollar General CEO Todd Vasos reported that an increasing number of higher-income customers, specifically those earning over $100,000 annually, are turning to their stores.

Creedon noted that these wealthier shoppers have become a “meaningful growth driver,” while Vasos highlighted that Dollar General saw the highest percentage of “trade-in” shoppers, people who usually shop at more expensive retailers, in four years. This trend contributed to same-store sales increases of 5.4% for Dollar Tree and 3.4% for Dollar General in the latest quarter.

Economic anxiety seems to be fueling the growth in low-cost stores. The newfound appeal of dollar stores to higher-income consumers isn’t just about saving a few bucks; it’s about growing economic uncertainty. Several factors are putting pressure on household budgets:

• Tariffs: The return of tariffs, especially those targeting Chinese imports, has created new costs that ripple through the supply chain. April saw a spike in foot traffic at dollar stores that coincided with fresh tariffs taking effect.
• Weakening labor market: A new ADP report showed U.S. private payroll growth slowing significantly, signaling potential hesitation among employers.
• Consumer confidence: While ticking up slightly in May, the overall mood remains cautious. Consumers are making more discerning purchases.

Are tariffs a boon or burden? Many are saying there’s a silver lining. The impact of tariffs on dollar stores is twofold. On one hand, the uncertainty drives more customers to cheaper retailers. The impact on the margins is significant.

Dollar Tree, which sources 41%-43% of its products through direct imports, primarily from China, warned of a potential 50% year-over-year drop in adjusted earnings for the second quarter due to tariff-related costs. That warning triggered a 10% drop in its stock.

In contrast, Dollar General is more insulated. With 80% of its sales coming from food (most of it made in the U.S.), its direct import exposure is under 10%. That’s a strategic advantage in a tariff-sensitive environment. As a result, the company raised its earnings forecast and is positioning itself to benefit further if economic pressures mount.

Wall Street seems to be warming up to thirty buyers in discount stores. Despite their struggles in the broader market over the past year, with both stocks dropping more than 20%,Dollar General and Dollar Tree outperformed the S&P 500 in 2025. Year to date, shares are up 45% and 18%, respectively, compared to the S&P’s modest 1.8% gain.

Big box retailers like Walmart and Target have lagged behind, with Target in particular seeing nearly a 30% decline in its share price. Even Walmart, which has also reported increased traffic from higher-income shoppers, has only managed an 11% gain.

Cha-Ching! The rising popularity of dollar stores among affluent Americans is not a cause for celebration; it’s a symptom of deeper economic unease. When people with comfortable incomes start bargain-hunting out of necessity rather than frugality, it’s a clear sign that economic cracks are widening.

In a healthy economy, dollar stores thrive by serving those who need them most. In a fragile economy, they serve as a haven for everyone and serve as a clear indication that even the wealthiest are beginning to feel the pressure.

The boom in dollar store traffic is a telling indicator. It says that Americans are worried about inflation, about trade, and about their jobs.

Final Word: Saving money has never been so profitable! Now shoppers can have bread with their water 😁 Cha-Ching!

Resource: https://finance.yahoo.com – Disclaimer: This article is for informational and educational purposes only and should not be construed as financial, investment, or legal advice. The content reflects the author’s opinions based on personal research and experience and may not be suitable for your individual circumstances. Always conduct your own due diligence and consult with a qualified financial advisor, accountant, or legal professional before making any financial decisions. The author and publisher assume no responsibility or liability for any errors or omissions in the content or for any actions taken based on the information provided.