Retail Merchandiser

Consumers get the best value for their money at this Vancouver-based single price point chain.

Anyone who thinks of dollar stores as a deep-discounted hodgepodge of hit-or-miss items has likely never shopped at one of the 74 Vancouver, British Columbia-based Dollar Giant stores. With a clean, well-lit layout and a large assortment of merchandise, president, founder, and CEO Joe Calvano is making Dollar Giant an everyday destination for thousands of Canadian shoppers.

“We have a very expansive assortment,” said Calvano. “We probably carry 25% more SKUs than our largest competitor, giving our customers a little more variety.”

When customers walk into a Dollar Giant, it’s easy to identify store specials and where to find the large assortment of food, greeting cards, housewares, and party goods. Calvano said
customers also know what they’ll be paying. Although Dollar Giant changed the price point from $1 to $1.25 for the majority of its merchandise in May, the chain is still one of the few offering the majority of its merchandise at a single low price. Some items, including food and greeting cards, are still $1.

“A lot of the dollar stores you go into, merchandise can be $2, $5, or even $10,” Calvano said. “We have the distinction in the Canadian market of being the only corporately owned dollar store that’s stayed at a single price point.”

Sticking to a low price point hasn’t hurt Dollar Giant’s bottom line. This year, the chain added 10 new stores in British Columbia, Saskatchewan, Alberta, and Ontario, and existing stores have seen sales increases.

“Financially, things have been very positive,” Calvano said. “We’ve fulfilled our plans for expansion, and business has been positive.”

Dollars and change

Calvano isn’t one to just sit back and let the dollars roll in on their own. Over the next several years, he has plans to build as many as 50 new stores and improve systems for employees, customers, and vendors.

By June, a new POS system should be up and running in all stores. “This should help our customers by making sure that everyday basics are not out of stock,” Calvano said. “For us, we’ll know what’s selling, what we need to buy, and what’s not selling quickly, and we’ll be able to react to that.”

With the POS system in place, customers are more likely to find the products they expect when they walk into a Dollar Giant. And, increasingly, customers have been expecting an array of major brand snacks, chips, soft drinks, and other
food items.

“No question, we’ve been very strong in consumables, especially over the past five months,” said Calvano. As the company continues to grow, aggressively focusing on providing a wider selection of brand name foods is one of the keys for increasing sales.

When it comes to getting new customers and keeping the existing ones, the focus is on running clean and organized stores, building new stores in high traffic locations, and word-of-mouth advertising. That formula has helped increase sales at existing stores and laid the groundwork for planned expansion in the next five years, Calvano said.

“We’re getting new customers, but the big thing is retaining the customers we have,” he said. Having stores in heavily traveled areas like malls and large shopping centers makes it easy for customers to stop in at a Dollar Giant. “We get a lot of customers walking into our stores, and when they walk in for the first time, they usually end up coming back.”

Vendor friendly

Keeping customers happy is the top priority at Dollar Giant, but given the huge inventory and low prices, having goodrelationships with vendors is almost as important. The chain has traditionally had strong relationships with vendors, with Calvano valuing those offering reliability and honesty in addition to good product prices.

The switch to a POS system isn’t the only technological leap Dollar Giant has taken. A portal on the company’s Web site lets vendors place electronic orders.

“We’ve made it easier for the vendors by giving them the opportunity to go on the Web site and place their orders for us, generate purchase orders, and make it seamless from the placement of the order to the order coming in,” Calvano said. Giving vendors better ordering tools increases efficiency and helps keep stores better stocked.

Dollar Giant is taking other steps to increase its overall efficiency, from installing more efficient and environmentally friendly lighting in new and remodeled stores to looking at ways to reduce waste. Calvano said he’s aware of the benefits of reducing the chain’s carbon footprint.

“We’re very aware of the things we can do to help the environment, whether it’s using fewer plastic bags, using less packaging, or recycling,” he said. “We’re very conscious of our part in the marketplace.”

Expansion plans

Just as Dollar Giant has a close relationship with its vendors, it also works closely with Dan Clark of Siting, a real estate firm, when it comes to selecting new store sites. Clark, who has worked with Dollar Giant for eight years, helps review each site before building begins, analyzing demographics and potentials.

“We’re looking to open a minimum of 10 to 15 stores next year, as well as remodel six stores,” said Calvano. “Our goal over the next three years is to add 40 to 50 new stores.” The company will look aggressively at new store sites in British Columbia and Ontario, as well as continuing to look for locations in Alberta and Saskatchewan.

As Dollar Giant grows, Calvano said he will make sure the company continues to provide the best products at low prices and makes the best use of technology to increase efficiency.

“We’re planning ahead to see how we can generate more sales per square foot in each of our stores, how we can become more efficient, and what we can do to make sure we have the best locations,” he said. “We feel that we’re in a great position for the next three to five years.”