Discount stores thrive in U.S. amid surging prices
14:48 JST, October 30, 2022
NEW YORK — Discount store chains, including those operated by Japanese companies, are increasingly popular in the United States as consumers tighten their purse strings amid rapid inflation. The number of retail shops in general in the United States, which had been on a steady decline, is now expected to show a large increase.
G.U. Co., an affordable clothing retailer and a subsidiary of Fast Retailing Co., opened its first shop in the United States on Oct. 7 in New York.
Before the store’s 10 a.m. opening, a long line of some 150 people formed in front of the GU store.
A 22-year-old company employee who bought a scarf and a cap said with excitement that she wanted to visit the shop again as the products were of high quality and the prices were very reasonable.
G.U. President Osamu Yunoki, who was there to observe the store’s opening, said, “I feel there is a growing demand for products along all three vectors: fashionableness, functionality and affordability. There are more customers today than I expected.”
When Daiso Industries Co., which operates ¥100 shops in Japan, opened a new store in New York in July, locals formed a line there, too.
According to BDO, a market research company, the number of retail shops in the United States as of August 2022 had increased by about 2,500 from the end of 2021.
Though the number had been on the decline due to the COVID-19 pandemic and the expansion of online shopping, it is now expected to trend upward.
BDO said that most of the newly opened shops are discount stores.
Dollar General, a major discount store chain that operates about 18,000 outlets across the United States, plans to open about 1,000 new stores this year.
Polling firm Morning Consult released a report on changes in consumer behavior in August. According to the report, 79% of survey respondents said they had started looking for discount goods and 66% said they had tried to avoid paying delivery fees due to inflation.
The growing number of consumers seeking to reduce impulse purchases and buy items only after seeing them carefully in person has also been key to the proliferation of discount stores.
Because the U.S. Federal Reserve Board has tightened its monetary policy to tamp down inflation, an increasing number of economists fear that the U.S. economy will face a slow down.
A BDO representative said that while there will probably be more retailers going under, discount stores will continue to multiply.
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