Discount Stores
These retailers offer a broad assortment of general merchandise, from apparel to groceries, at lower-than-average prices by relying on high sales volume and low operating margins.
Why it exists
To supply essential goods at the lowest possible price through operational efficiency.
Why it’s necessary
It serves budget-constrained consumers and thrives in inflationary or uncertain economic environments.
Key components
Extreme SKU discipline
Private-label sourcing
High inventory turns
Low-rent store footprints
How to evaluate businesses
Store-level margins, same-store sales growth, shrink control, inventory turnover, and distribution efficiency are critical.
How the industry could be improved
AI-based demand stocking, automated checkout, micro-warehousing, and smarter private-label testing through rapid iteration.