5 things: CPG brands are stacking their dollars in dollar stores

How Kraft Heinz is leaning into dollar stores: The popularity of dollar stores only continues to grow (this year, Dollar General plans to open another 1,050 stores and Dollar Tree another 650) — so much so that CPG companies are now tailoring popular products to get a version on the shelves of discount stores. Kraft Heinz has its eye on “meal solution”-type offerings. For instance, the company has made a cheaper version of its Lunchables snack pack, selling at just $1.25. And it’s also using marketing tactics like “Taco Tuesday” meals (selling its Taco Bell-branded products) or “Italian night,” with Classico pasta sauce to change the perception that dollar stores only offer a drink and a snack. Kraft Heinz’s distribution has grown 7% across dollar store customers in the past year, and the company says it has “a path to double-digit growth by year-end.” Grocers take note. —Chloe Riley

The only one of its kind: It’s great to be No. 1 … but it’s not so great to be the only one. The Costco in Brooklyn opened back in the mid-1990s and has been one of the best the company has to offer in terms of total sales revenue. But there’s a good reason behind all those dollar signs — it also happens to be the only Costco in the burrough. That means it’s always packed, like — hundreds during the first half hour of the store opening each day — that kind of packed. The parking lot rarely has open spots, the food court is stuffed with people, and lines to checkout go all the way to Manhattan, where you will find the next closest Costco. So why hasn’t the company invested in, at the very least, a second store in the area? Nobody really knows. Costco took a chance on the spot with the first store because it was located in an industrialized area. Well, I think it’s safe to take another chance. —Bill Wilson

The slippery slope of self-checkout: Self-checkout certainly saves on labor costs, but there can also be drawbacks, according to this piece from The Georgia Sun. Namely: higher potential theft opportunities, as well as missed points of connection with shoppers. With regard to theft, self-checkout accounts for nearly 4% of inventory loss for retailers, compared to just 1.5% for traditional checkout. So don’t make assumptions: while self-checkout may save you on labor costs in the short term, it could catch up with you in the long run. —Alarice Rajagopal

Companies are cracking down on union organizers: A pattern of similar worker accusations — and corporate denials — has arisen at Starbucks, REI, and Trader Joe’s as retail workers have sought to form unions in the past two years, according to the New York Times. At a Trader Joe’s store in Louisville, Ky., the third within the company to unionize, two employees who were supportive of the union campaign were fired and the company has formally disciplined several more. A Trader Joe’s spokeswoman said that the company had never disciplined an employee for seeking to unionize but that unionizing efforts didn’t exempt an employee from job responsibilities. Where will things head going forward? We’ll keep an eye on it. —CR

Open and closed: Yellow Banana was finally able to open a Save A Lot store in Chicago’s low-income Englewood neighborhood in mid-May. The opening came after months of waiting due to residents protesting the store, which was replacing a Whole Foods. After that Save A Lot opened, another store located in a nearby neighborhood, closed. Yellow Banana owns both, and said the other location will be shuttered indefinitely after a robbery over the weekend resulted in thousands of dollars in losses. Shoppers are being directed to the newly opened store in Englewood, a mile and a half away. That’s too far for some, but right now they are left with no choice. Yellow Banana was robbed, and now the people are being robbed of their food source. —BW

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The popularity of dollar stores only continues to grow — so much so that CPG companies are now tailoring popular products to get a version on the shelves of discount stores. Kraft Heinz has its eye on “meal solution”-type offerings. For instance, the company has made a cheaper version of its Lunchables snack pack, selling at just $1.25. Who else do you think will follow Kraft Heinz? Is this the start of a huge splash at the dollar store level?

Let us know in the comments below, or email your thoughts to the SN staff at [email protected].