In Lewiston-Auburn, Dollar Stores a Dime a Dozen

May 13, 2014

The Lewiston-Auburn area is poised for a mini retail boom - of sorts. Two major discount "dollar store" chains are targeting the Twin Cities for major development in the near future - a move that some industry observers find interesting, given that hundreds of dollar stores are closing elsewhere in the country.

Heavy equipment prepares the ground for the construction of an 8,300-square-foot Family Dollar store on Sabbatus Street, about two-and-a-half miles from downtown Lewiston. 

It's likely to be the first of several new discount stores coming to this area. That's because Dollar General - which currently has no stores in Maine - is expected to start work on a similar sized operation less than a mile down the street.

Lewiston-Auburn already accommodates four dollars stores, with the Family Dollar and Dollar Tree chains each operating two stores in the area. But more are coming.

Lewiston Economic Development Director Lincoln Jeffers
Credit Tom Porter / MPBN

  In all, Family Dollar and Dollar General are looking to open eight stores between them in the greater Lewiston-Auburn area, says Lewiston's Director of Economic and Community Development Lincoln Jeffers.

"I think it's just adding to the retail mix, to the diversity of things," Jeffers says. "I mean, certainly, not everybody shops at a dollar store, but there are those who do, and it's great to have them proximal and easily accessible to them."

Spokesmen for Family Dollar and Dollar General both declined to be interviewed on tape about plans to expand in Maine. But city officials say the two companies want to bring four stores to Lewiston and Auburn, two to Sabbatus and one each to Greene and Turner, creating several dozen jobs.

With downtown Lewiston now home to several restaurants and cafes, as well as higher-end retail shops, Jeffers says the influx of dollar stores offers consumers more low-cost alternatives to big-box stores like Wal-Mart.

"Which is 100,000 square feet of space, and you might need just a handful of things but you've got to deal with acres of floor space," Jeffers says. "These things tend to be about 10,000 square feet, so a limited number of items, low-cost items, so it's comparable to the type of things you might pick up at Wal-Mart, and they're trying to create more of them, make them very easy to get to, access. They're tending to be built near where a lot of people live."

Jeffers says the response from local people has been largely positive. That's certainly the case with sprightly octogenerian Marie Evans.

Tom Porter: "So how do you feel about those eight dollar stores coming to Lewison-Auburn?"

Marie Evans: "I love it. I already got a list made up of what I'm going to buy as soon as I can take a bus up there."

Local business owner Don Castonguay runs Don's Big Bargains - a discount store in a residential area near downtown Lewiston that sells what he calls "odds and ends, knick-knacks and trinkets" at low prices: similar fare to much of what's on offer at your typical Family Dollar or Dollar General.

So is he worried he might lose customers as more of these discount stores come to the area? "No, I'm not," he says, "because where they're located they'd have to take a bus or a cab, you know. And I'm more convenient, so I"m not worried."

Industry observers, meanwhile, say these are interesting times for the discount retail sector. "You know, it's not the sexiest business, but it is hugely interesting from a strategy perspective, especially now," says Kyle Stock, associate editor at Bloomberg Businessweek.

Stock describes the sector as healthy but challenged, as evidenced by Family Dollar's recent disappointing earnings report and its decision to shutter 370 stores nationwide. Stock says this recent wave of closures is due to the fierce competition that followed an earlier huge expansion in the number of dollar stores.

He says over the past five years the three big dollar chains - Family Dollar, Dollar General and Dollar Tree - have added 5,700 stores to their networks. There are now about 25,000 of these stores across the nation, and Stock says the race is on between these dollar chains to identify, and move into, under-served areas.

Point in case: Dollar General and Family Dollar going head-to-head in central Maine.

"What they're doing is - as you guys are seeing in Maine - is looking for empty parts of the country to add some stores and pick up some new customers," Stock says. "I mean, it is literally a land grab in a lot of ways. They've gone around the country and sort of picked the low-hanging fruit, and now they're spreading out and kind of right-sizing their stores."

But the question remains: To what extent does the addition of handful of dollar stores represent economic development in a community? "It's a fair question," says Lincoln Jeffers, from the city Lewiston. "It is creating a handful of jobs. Is it the economic development we go out and actively pursue? No."

But what it does do, he says, is provide consumers with more low-cost retail options.