They are a higher-cost operation, by and large. They have lower asset turns than other discount retailers, but they get paid for it. They break bulk profitably, so they have in fact the kinds of pricing premiums — even in discount retail, for crying out loud, I want to say — in ways that drive their superior profitability.
That one really surprised us, because if we were going to find an exception, we would have thought we’d have found it there. But we didn’t.
The article Family Dollar: Top Dog in Discount Retail originally appeared on Fool.com.
Brendan Byrnes and The Motley Fool have no position in any of the stocks mentioned.
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