Spending made simple. No waiting. No delays. With the Square Debit Mastercard, you can access your money as soon as you make a sale—no transfer delays, no fees. Turn sales into purchases, payroll, or whatever your business needs instantly. Get your free debit card today.
Block, Inc. is a financial services platform and not an FDIC-insured bank. Square Debit Card is issued by Sutton Bank, Member FDIC, pursuant to a license from Mastercard.
With tariffs shaking up global supply chains and US consumers wary about their economic futures, discounters are hitting their stride. After some high-profile bankruptcies in 2024 from low-price outlets such as Big Lots and 99 Cents Only, the biggest players are thriving: Dollar Tree, Dollar General, Five Below, and Ollie’s Bargain Outlet all reported sales increases in the first quarter while also issuing optimistic outlooks for the rest of the year.
But it’s probably not wise to paint with too broad a (three for $2) brush when it comes to the discount space. Each of these stores have their own strategies for surviving and thriving in the current environment, and over a spate of earnings calls this month, they revealed their top priorities, ranging from expanding their loyalty programs to getting into the delivery business.
The rise of the Bargainauts: Ollie’s Bargain Outlet, for example, is raising an “army” through its popular loyalty program.
“Our Ollie’s Army members are our most dedicated customers who account for more than 80% of our sales and spend close to 40% more per visit and shop more frequently,” CEO Eric van der Valk told shareholders. “These are value-seeking Bargainauts who take pride in saving money and being an Ollie’s Army member.”
The loyalty program’s membership increased 9% to 15.5 million customers in the first quarter, when the company also completed the rollout of a co-branded credit card.
Going forward, Ollie’s is trying to extend additional benefits with the launch of a new private shopping event for members in June, adding to a similar event that it holds in December. “This is different from previous years where the late June promotions were available to anyone,” van der Valk said. “You now have to be a member to take advantage of these.”
Discount delivery giant: Dollar General, meanwhile, is using its expansive physical footprint to rapidly build out a delivery network.
The company started testing same-day delivery through the DoorDash platform in late 2024. Now more than 16,000 customers are in the programs, and sales through the platforms increased 50% in the first quarter.
Giving this program a boost was the decision announced this May that Dollar General would start accepting SNAP and EBT benefits through the DoorDash marketplace, which CEO Todd J. Vasos said “contributed nicely to our sales growth in Q1.”
“We believe our expansive real estate footprint uniquely positions us to offer a compelling home delivery option and ultimately become the fastest delivery alternative for customers and our communities,” he said.
Trend chasing: Turning back to the in-store experience, Five Below is focused on keeping its assortment fresh and on-trend.
“Providing fresh, trend-right and quality products at amazing value is what we are known for and what makes us special,” CEO Winifred Y. Park said in an earnings call. “We drove sales by consistently flowing newness, most notably in beauty, style, and novelty food.”
- To give one example, the store recently sold out of Hello Kitty Squishmallows, a popular plushy toy. “In toys and games, we remain a key destination for collectibles,” Park said.
Five Below has also tried to align its assortment with what it calls “curtain-up moments” designed to draw customers into stores. The six biggest include spring break, summer, back to school, Halloween, and winter holidays. Now the goal is to extend these opportunities throughout the year.
“We have exciting plans in place for the remaining curtain-up moments throughout the year and look forward to sharing our progress,” Park said.
Dollar store no more: Yet for all these wide-ranging initiatives, price remains at the center of these discounters’ businesses, and Dollar Tree arguably was most focused on the topic coming out of Q1.
CEO Michael C. Creedon stressed that the dollar chain is embracing “multi-price,” even as he maintained that this is not a “break the dollar moment.”
While noting that 85% of products in its stores still cost less than $2, he said offering multiple price points “gives us the flexibility to make sure that if a customer wants that product, we can have that product for them.”
Behind this effort is another trend: More high and middle-income shoppers are trading down to Dollar Tree. The company added 2.6 million new customers in Q1, and the majority of that growth came from shoppers with more than $100,000 household income.
“The customer is getting what they want across all income cohorts and yes, the multi-price really resonates with that higher-income customer,” Creedon said.