The Almighty Dollar Store

"How much is this?" "A dollar." "Wow. And this?" " A dollar." "Well, how about this?" "Still a dollar." That's the beauty of the ever-popular, ever-burgeoning dollar store concept. For customers, the price stays the same. But for the folks who own these stores, the profits keep climbing.

"Discount retail sales has been the fastest growing segment of the retail market in today's economy," explains "Dollar" Dan Margles, vice president of operations at Allied Systems Industries (ASI). Allied is the originator of the dollar-store concept and the nation's largest developer of independently-owned dollar stores. The company has more than 400 locations nationwide and Margles says this industry is one of the few that actually thrives in a slow economy.

Dollar-pinching customers are just one of three trends driving growth at Allied. "There's a huge selection of items, all under one roof," Margles notes. "At an ASI Dollar Store, 30 percent of the merchandise turns over every month and customers keep coming back to see what's new." There's more. "Many corporate executives and middle managers are now looking to start their own business. ASI Dollar Stores are a relatively low investment. Our average customer this year is purchasing a complete turnkey store with high-end inventory and fixtures for considerably under $200,000." When Margles talks "turn-key," here's what he means. ASI helps its owners customize the store to fit the area, which can be anywhere from 1,000 to 17,000 square feet. The price ranges from $65,000 to about $499,000, depending on the size.

The investment includes everything from a carefully researched site, a fully-stocked custom designed new store, owner training, and continuing marketing and operations help. Onsite training includes set-up of the merchandise, re-ordering and inventory management, personnel hiring and operations guidance. "The owner literally has to show up on the day of the Grand Opening and turn the key," Margles says.

After-help is just as important. ASI Dollar Store owners get free membership in the company's national buying group, where they have access to some 200,000 different items at any one time. Since Allied owners are such a large buying group, they can negotiate far better pricing, quality and service than a go-it-alone entrepreneur might.

The stores do well in just about any city with a population of at least 5,000. Owner's don't need previous retail experience and ASI Dollar Stores aren't a franchise, so there's no monthly royalty fee. "You get all of the benefits of a franchise without the typical restrictions or red tape," Margles says. "The initial investment is the only fee and the store owner reaps the benefits of preferred pricing and service from the national buying group." Because there is no required merchandise, the store owner also is free to choose various different lines and different suppliers, customizing the store and tailoring the inventory to customer demands. Financing is available through local banks and such sources as the U.S. Small Business Administration. "Dollar Stores have universal appeal," Margles concludes. "Everybody loves a bargain and these are basically bargain stores with a huge inventory that appeals to everybody." Name of company: Allied Systems Industries Type of business: Dollar Store Development Company Date the company was established: September, 1991 Number of developed units: 400 PLUS Number of company-owned units: 1 Developing internationally in.... All areas Cash investment: $50,000 minimum Owner qualifications: We will train Contact: SALES DEPT., Allied Systems Industries, 4560 South Decatur #302, Las Vegas, Nevada 89103; Telephone 800-365-9099 "Dollar-pinching customers are just one of three trends driving growth at Allied."

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