Dollar stores gain while grocers stumble

Nadine Gruber • 29/08/2026 • 2 min read

Dollar stores are outperforming grocers with over 3% same-store sales growth, as Dollar General and Dollar Tree both gain while Kroger stumbles.

Dollar stores gain while grocers stumble - dollar stores — Dollar stores gain while grocers stumble

Dollar General and Dollar Tree both reported same-store sales growth above 3% for their latest quarters, a sharp contrast to the weak results traditional grocers have posted recently. The discount retailers saw customer traffic and average basket sizes climb during the period, with Dollar General’s same-store sales up 3.5% and Dollar Tree’s comparable sales rising 3.7%.

Those numbers stand out because Kroger recorded comparable sales growth of just 1% in its most recent quarter, while Albertsons saw comps decline by a similar percentage.

Dollar chains post strong sales growth while supermarkets struggle

Dollar General’s net sales climbed 5.2% year over year to $11.3 billion for the quarter ending July 31. Dollar Tree, which operates fewer than half as many stores, saw sales jump 7% to $4.9 billion for its quarter wrapping up Aug. 1.

Dollar General’s store traffic rose 2% and average basket size increased 1.5%, according to CEO Todd Vasos. “Notably, this marks the fifth consecutive quarter of growth in customer traffic as we continue to build on the momentum in our business with both new and existing customers,” Vasos said during Thursday’s earnings call.

Dollar Tree’s traffic was up 0.4% while its average basket grew more than 3%. The company saw especially strong demand for consumables, with sales in that category up 5.8% compared with the same period last year. Discretionary goods rose just 1.6%.

CFO Stewart Glendinning said consumables will likely lead sales growth in the second half of the year, though he noted that trend will keep margins somewhat under pressure. Both retailers said they used tariff refunds received during the quarter to lower prices.

Tariff refunds go toward pricing and store improvements

Dollar Tree received a $383 million tariff refund, and Glendinning said the company is putting those funds toward targeted pricing strategies, marketing, store operations and store conditions. “We are focusing those dollars on targeted pricing strategies, marketing, store operations and store conditions, areas that can benefit our customers today while strengthening the business for the long term,” he said.

Dollar Tree CEO Michael Creedon said the company is “driving a better assortment in more and better-run stores and speaking to our customers in ways we never have before.” He added that early customer response gives the company confidence in its long-term strategy.

The two retailers’ fiscal quarters ended on different dates, with Dollar General’s closing July 31 and Dollar Tree’s wrapping up Aug. 1. Both companies reported results on the same day.