Shop and Save

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Even in a surging economy, Americans are still fond of saving a few bucks. Case in point: the dollar store. According to ACNielsen, 52 percent of U.S. householders shopped at dollar stores last year, compared with 47 percent in 1998. While most of these stores are situated in the South and in rural areas, even cosmopolitan Manhattan has sprouted a few. Still, the average dollar shopper comes from a less-than-affluent household. Among "heavy" dollar store shoppers (the 33 percent of customers who generate more than 80 percent of the stores' revenues), 58 percent live in 4-person households earning less than $40,000 annually. So what exactly makes these stores so appealing? Low prices, a wide selection of basic items, and a simple pricing structure.

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