Thursday, June 30, 2011

Loonies and Toonies Ain't What They Used to Be

I'd mentioned this in passing yesterday, but let's flesh it out a little more today: a dollar store selling its dollar-store things for two dollars is just stupid as all get-out.

Now, I don't know if this is something everybody does, if it's a natural byproduct of getting older, or if this is just some particularly thorough internal stubbornness on my part, but after a while the price I am willing to pay for something crystallizes in my head and I absolutely refuse outright to pay more for that item again in my life. There are certain exceptions to this -- although these exceptions are pretty well limited to milk, bread, peanut butter, gasoline and beer -- but for most everything that isn't an absolute necessity, if it ain't on sale, and it ain't at the price point I default to, I ain't buying it.

A chocolate bar is fifty cents. That's an example, and that's my rule; if it costs more than that, screw you, it's overpriced. I don't need a chocolate bar, and I certainly don't need one enough that I would ever pay a buck twenty or a buck fifty for it. Who are these people playing a dollar and change for fifty grams of chocolate? Whoever you are, you're ruining it for the rest of us.

This line of thought was a primary factor in my diet as a cash-strapped, hardscrabble grad-student; my shopping list would be milk, bread, some vegetables, and then arbitrary selections from whatever items were in the sale cycle that week. Soup is half-off? Yo, I'll eat soup, gimme that.

When you pay attention to these things like I do -- and let's be honest, we're in Winnipeg, there are probably a lot of you doing the same things -- the little differences are noticeable, which means the bigger differences seem glaring. So when chains have spent decades establishing their brand as a dollar store -- a literal dollar store, in which things cost a maximum of a dollar -- they have to have expected that people would be less than impressed when they literally doubled the price of their stuff.

Dollarama is the notable offender here when you walk into one and see their damage control right out front, a sign at the entrance informing customers (and here I am paraphrasing) that "MANY OF OUR ITEMS ARE NOW PRICED AT $1.50 OR $2.00 WE STILL HAVE THOUSANDS OF ITEMS FOR JUST $1". Yeah, okay, but those are all the crap that was never actually worth a dollar begin with. And your name is Dollarama. You aren't like A Buck or Two, who had the forethought to pre-program their future weaseling right into their brand name. (But then Buck or Two tries to charge five bucks for a clock, or who knows what, so the hell with them too.)

It would be plausible for Dollarama defenders to write the increases off as an economy thing -- aw, that economy, you know how it is -- but the change was very clearly made to drive its stock prices, which worked in the short term but appears to be quickly losing its efficacy. That link also foreshadows that the move may have been made in the name of bankrolling future expansion:

"CIBC’s Mr. Caicco says Canada’s dollar-store industry will grow by 60 per cent before the end of the decade, to 2,700 stores, including at least one more U.S. entrant; Dollarama, he says, could have 1,100 of them (compared with 650 today)."

Can you even picture a 60% increase in dollar stores? Like our only collective problem with them is that there aren't enough of them? We're just going to have entire city blocks of them, it's going to be the worst.

These things stick with me, you know? I don't know why. You're all aware that KFC has a Canadian promotion it calls "Toonie Tuesday", which has been running for several years now. And the name implies a certain pricing scheme, doesn't it? The initial deal when it debuted was that two dollars would get you two pieces of chicken -- the pieces they couldn't get rid of otherwise, yes, but two pieces -- and a small bag of fries. The bag holds maybe eight fries, but what did you want? It was two dollars. Plus taxes.

It was unsurprisingly something of a success around parts like these, but then one day -- without anything really in the name of explanation -- the price point on the Tuesday special jumped up to $2.49 plus taxes, and then a while after that to $2.79 plus taxes. So what do they call it now? Toonie Tuesday. You walk into a KFC, you look at a sign like this, and you contemplate whether or not you are the last sane man in the universe.

Okay, where are we at for June here? 28 posts in 30 days? Ahhhhhhh--well, that's disappointing, for Daily Post Month, but I guess it'll have to do. Sorry, folks! I gave it a shot.


cherenkov said...

I suppose Profit Margin Fuck You Day is too big to fit on the poster.

Colin said...

Maybe we're just re-defining what the word "dollar" actually means.
Instead of 100 cents or 10 dimes, it now means "kinda cheap, pocket change".

The Great Canadian Talk Show said...

I think you skipped the $2.22 phase of KFC "Toonie Tuesday" definition.

Shaun M. Wheeler said...

Awww, come on! What's a 100% price increase among friends?

Anonymous said...

As far as I am concerned if you shop at a dollar store you should be shot on sight. They are a blight on our society.

Cdnprogressive said...

First, a reply to our anonymous friend. Shooting dollar store patrons because of your dislike for the concept itself seems like eliminationism, does it not? Did you even consider the fact that these people shop there out of need and not desire? You're despicable.

Which leads to my second point: the increase in pricing points in dollar stores North American wide has not been a one sided cash grab initiated solely by the industry. The process has been helped along by the tidal wave of consumers trading down from Wal-Mart, Sears, Superstore and Target; this wave being a part of the overall economic "not a depression because calling it a depression would be admitting defeat or something" recession. With this consumer movement dollar stores have had to adjust to (and let's be honest, attempt to take advantage of) this increase in capital and demand. The number of items that can be sold at 1 has shrunken; the number that can be sold at 1.25, 1.50 and 2.00 has conversely grown. Is the dollar store to lose it's business because it's inventory mix must shrink due to inflation or recession because of an unwavering commitment to a set price point? What consumers want from a business and what makes sense for that business on a purely survival standpoint are often two very different concepts.

Speaking of unwavering commitments, keeping your mind set on a certain price is not a very smart way to deal with your money. You won't pay more than 50 cents for a chocolate bar, but when did you come up with this barrier? What cost 50 cents yesterday is not the same product as what costs 50 cents today.

When the price of sugar increases, do you think that chocolate makers decimate their profit margins in order to keep selling chocolate bars at the same price? Or do they put a chocolate bar made from inferior ingredients into the same packaging? For every self-styled penny pincher out there, there's a marketing team working on a strategy implementing creeping normalcy in order to squeeze those pennies through your pincers. I guess this is fine if what you want is the concept of a chocolate bar; if, on the other hand, you want the product that made you a fan of chocolate bars in the first place, you're going to have to develop a more sophisticated approach to your selection process in a world where dollar stores stand for “cheap-for-a-reason goods available for all” and scarcity is the most important creeping normalcy of them all.