Dollar Store Franchise

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The nickel$ and dime$ of a dollar store franchise

There's a guilty pleasure to be found when shopping in dollar stores. Not only does it bring you back to the days of the appropriately named 'penny candy' but you can also come away with some decent purchases for, well, a buck. If you're thinking about investing in a dollar store franchise, read on for more information.

Paul Cohen, owner of the Dollar Discount Store franchise, insists that dollar stores don't sell cheaply made goods. Cohen stresses that the goods are simply small and well selected, which allows customers a wide variety of inexpensive yet quality products to choose from. The idea that dollar stores are filled with cheap knick-knacks is, unfortunately, a common one. But in reality, dollar stores can be likened to a stationary and convenience store in one, selling an assortment of low-priced items like greeting cards, seasonal decorations, snacks, candy and paper goods.

It is relatively inexpensive to own and operate a dollar store franchise. Expect to invest $99,000 to $195,000 in a Dollar Discount Store, and competitors Dollar World and Your Dollar Store with More command similar prices. Meanwhile, a normal retail store selling full-priced goods can cost from $150,000 to $600,000.

The total investment, royalty fee, franchise fee, terms, availability of financing and franchisee qualifications all depend on each dollar store's franchise policy. The time required get your dollar store fully functioning also depends on the individual brand and size of the franchise.

So why would a future franchisee look into owning a dollar store franchise? The industry has its benefits:

Low investment costs when compared to 'regular' retail stores
Great mark-up value; franchisees buy products for pennies and sell them for dollars
With such a low cost inventory, there's little risk if something goes wrong
Low labor costs and minimal staff training
The simple, no frills store design requires low maintenance

And of course it has its negatives:

Check your area carefully to determine that a market exists. Dollar store franchises do best in rural America , where the cost of living is lower and variety is lacking
Dollar stores have to fight the an unfortunate reputation that they are kitsch stores and sell cheap goods
Prevailing lack of brand awareness and customer loyalty