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What's in Store Seafood for a buck? Quick- grab items like IQF fish fillets fit the dollar-store price tag. and CFO of Dollar General on an investor conference call. Dollar General Markets generate average sales of $4 million to $5 million per unit, versus $1.4 million at tradi- tional Dollar General stores. Similarly, the 7,200-store Family Dollar chain is ex- panding its consumables selection and reported a to- tal net sales increase of 9.6 percent to $2.36 billion in its third fiscal quarter. Com- parable store sales jumped 5 percent in that time period. Despite the growth of fro- Penny wise T Dollar stores find success with small portions of frozen seafood BY CHRISTINE BLANK he typical con- sumer out to the store for their weekly grocery-shopping trip may not think of the lo- cal dollar store for seafood, but that is changing rapidly. Over the past three years or so, most dollar-store chains have added the refrigerated and frozen sections to their stores, featuring a variety of packaged seafood items. Take 10,000-store Dollar General chain based in Goodlettsville, Tenn. A recent visit to one of its larger stores turned up several fro- zen seafood items, including Gorton's 18-count fish sticks for $4.15 per box, 12-ounce SeaPak Popcorn Shrimp for $4.50 each and 10-ounce SeaBest cooked shrimp heading (from Beaver Street Fisheries) for $6.35 each. Shoppers are finding similar frozen seafood options at the 4,400-store Dollar Tree chain, presented in a different way. Since Chesapeake, Va.-based Dollar Tree primarily sells items for $1 each, its frozen seafood portions are small. At a central Florida Dollar Tree, Ocean Market's 4-ounce pol- lock and wild flounder fillets were priced at $1 each. Small bags of breaded fish sticks and popcorn shrimp were also of- fered for $1, along with Great American Seafood's individu- ally packed 4-ounce tilapia fil- lets, Tastee Choice's 4-ounce cooked salad shrimp and 4-ounce packs of LaMonica breaded clam strips. Te dollar-store chains have found a formula that seems to be working. Tey have benefitted not only from 34 SeaFood Business September 2012 growing consumer interest in saving money, but also from consumers who live in "food deserts" and need to pick up a few grocery items quickly. In fact, Dollar General ex- ecutives attributed the com- pany's strong third-quarter earnings to sales of "consum- ables," along with seasonal and electronic products. Consolidated net sales for the quarter ending May 17 soared 11.5 percent to $1.72 billion and comparable store sales grew 5.6 percent. In fis- cal year 2011, consumables (cleaning products, beverag- es, health and beauty prod- ucts) accounted for 73.2 per- cent of the chain's total sales. Late last year, Dollar Gen- eral also announced plans to open 40 stores that feature fresh meat and produce in 2012 based on the perfor- mance of 25 Dollar General Markets that opened in 2011. "Because the product mix includes more consumables, the margin percentage is somewhat lower, but the raw dollars from the high volume are very impressive," said David Tehle, executive VP zen seafood in dollar stores, many seafood manufacturers are missing out on a potential- ly lucrative market, according to a food industry consultant. "Tere is a stigma around dollar stores. Many manufac- turers think that you have to have that one big sale," says Steve Johnson, founder of Foodservice Solutions. How- ever, with many dollar-store chains consisting of 7,000 or more stores each, the retail concept outnumbers grocery stores in the United States. Manufacturers need to be willing to change their prod- uct sizes to fit the format. "Te U.S. Census shows that 50 percent of all Americans over the age of 18 are single. Tri- dent Seafoods, National Fish, Margaritaville Foods, P.F. Chang's, and other manufac- turers need to re-merchandise their $10 box of individual portions sold in grocery stores and sell single portions into dollar stores," says Johnson. Twelve-ounce Popcorn Shrimp and 8-ounce But- terfly Shrimp from SeaPak Shrimp & Seafood Co. are also available at Dollar General. "Te dollar chan- nel provides products at a reasonable price, which has Continued on page 46 Visit us online at www.seafoodbusiness.com Photo by Christine Blank