Dollar General, a nearly 20,000-strong empire with a presence in every county, has a dark secret–a lawsuit for deceptive conduct.
What most of its customers don’t know is that this behavior has been costing them more than they have bargained for over the last seven years.
Dollar General Has Been Hit With $20 Million in Fines
During this period, the American-made franchise was hit with more than $20 million in fines but these penalties, to quote More Perfect Union: “Pale in comparison to the amount Dollar General has siphoned from communities,” and so the black and yellow branded franchise continues to grow.
This Tennessee-based chain founded in 1939 targets lower-income areas.
Stacey Mitchell from the Institute for Self-Reliance stated that this franchise, while often seen to be a symptom of economic distress, is actually the cause of it.
A Shadowy Business Strategy
Behind Dollar General’s so-called low prices lies a shadowy business strategy and an odium that has, up until this point, dodged the bright hot spotlight of the media.
Lorie Hartline from Texana, Oklahoma shops at Dollar General out of convenience and experienced this shady behavior firsthand.
“What you see here is when you travel, you’ll go from looking for a grocery store and before you get one, you have three Dollar General options,” she explains.
Dollar General’s Deceptive Pricing
Hartline had been shopping for cat litter at her local outlet and noticed discrepancies as early as May 2022.
She recalled the price of kitty litter being $8.95 when they opened their doors in 2021. The price stayed the same for a year–at least according to the tag on the shelf.
After making numerous visits to the store, she noticed one day at the checkout that she was being charged $10.00.
When she queried the discrepancy she was told that the price had been upped irrespective of what the tag on the shelf said.
Overcharging Customers
When Hartline returned for more cat litter the following week she experienced the same thing.
Just when she started wondering if she was the only person experiencing this behavior, she learned that Dollar General in Ohio was being brought to boot for the same infraction.
Her problem continued for months and if anything deteriorated. On an invoice from June 22 showed to YouTube’s Make Perfect Union, she was overcharged on four items at an average of $1.50 each.
Eventually, Lori decided to act and wrote a letter to the Oklahoma Attorney General.
Class Action Lawsuits in Three States
Two days later the official’s office indicated to Hartline that they had forwarded the letter to the franchise, which then responded directly with an apology and an offer of a $10 gift card.
Insulted, Hartline rejected the gift card. In the meantime, her case was escalated to former Attorney General of Ohio, Marc Dann.
The matter became the springboard for one of three group action lawsuits with the other two stemming from New York and New Jersey.
Targeting Areas ‘Lacking in Political and Economic Influence‘
Dann has since voiced his belief that Dollar General’s behavior was “intentionally and systematical” and that this practice anywhere in America was charged as theft by deception.
Enforcing the growing belief of the franchise’s premeditated dishonesty, research by Mitchell’s organization found the brand’s outlets gravitated towards areas lacking in political and economic influence.
Mitchell also noted Dollar General’s propensity to turn out in numbers, and in doing so, preventing other brands and local businesses from surviving.
‘As Exploitive a Business Plan as Ever’
“They kind of lock in poverty as they grow because poverty is the thing that really fuels these companies’ bottom lines,” Mitchell explained.
Dann highlighted this idea and called it “as exploitive a business plan” as he has ever seen.
“We have the poorest people in the country going to a store that’s deceiving them about the price
that they’re charging for goods in a situation where they have very few other realistic choices,” said Dann.
More Than ‘80% of Stores Failed Repeatedly‘
Micheal Stinziano, an auditor from Franklin County explained that price verification was a process of taking a product from the shelf and scanning it at the cash register to see if the prices match.
Auditors take a few random samples and are accustomed to finding one or two mismatches in stores across the country, but in the case of Dollar General Stinziano said, the discrepancies were “large and continuous.”
He indicated that more than 80% of the audited stores were failing repetitively while telegraphing “no acknowledgment or desire to correct” the problem.
Unguided and Understaffed
One of the key issues identified at these stores was that the staff there were not receiving any guidance and doing what they could to manage these businesses.
By extension, they may have been oblivious to the price verification discrepancies.
While this makes the problem sound like an oversight, Mitchell firmly believes the staffing issue is deliberate and an attempt to cut costs and that the pricing problem is a direct result of it.
She believes that cutting corners, even if it meant breaking the law, was the conscious decision of the company.
Fit for Prosecution
Attorney General Dann believes that hundreds of millions are being made from this illegal practice and that this money is being siphoned from the poor and going into the pockets of shareholders.
He also telegraphed that the time has come for civil action against Dollar General and that the brains behind this – very likely in the upper corporate tiers of the company – are fit for prosecution.
Mitchell, on the other hand, believes they should be shut down.
