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Dollarama opens to stiff competition

August 9th, 2012 · 1 Comment

Local businesses discuss the new discount store addition to the neighbourhood

By Kristin Eliason and Richard Frankel

The arrival of a Dollarama in the Bathurst and Bloor area is forcing local discount stores to brace for increased competition.

“Dollarama is opening 60 stores this year, and Toronto, as well as the GTA, continue to offer interesting growth opportunities,” said Lyla Radmanovich, a spokesperson for the dollar store chain. “Ultimately, Dollarama’s goal is to reach new customers, and this certainly applies to the location [at Bathurst and Bloor.]”

The new Dollarama store opened on June 16 at 512 Bloor St. W., just steps away from competitors that include Honest Ed’s and Payless For Everything.

According to Radmanovich, the level of retail activity, existing Dollarama locations, presence of competitors, population, and demographics of an area all factor into the decision of where to open new outlets.

But the decision to open the Bathurst and Bloor location is raising the hackles of some small business owners in the area.

“Their store kills everybody’s business,” said Julie Yue, the owner of Payless for Everything (807 Bathurst St.), a dollar store located just around the corner from the new Dollarama. “They never asked us [how we would feel about them moving in] … if they had asked us, we would have definitely said no.”

Yue, who has managed her store for nine years, believes it’s Dollarama’s ability to sell products below cost that seriously threatens the ability of small businesses like her own to survive. Her plan for change is simple: match Dollarama’s pricing, even if it means a loss in revenue, and continue to carry a variety of goods.

“Something we sell for $2, they sell for $1. We get them for $1.30. How can we sell them for $1?” she said. “We have to change our business now … if [Dollarama is] cheaper, they will still go over there.”

Yue hopes her business and merchandise will differ enough from Dollarama’s to keep her clients coming back. Many of her customers have already told her they will continue to patronize her store.

Honest Ed’s, a larger and better-established competitor of Dollarama, is not at all concerned about its new neighbour, according to Russell Lazar, the store’s general manager. Lazar said Honest Ed’s is unique and unusual, and it’s been that way since the store opened in 1948. However, he did add that it is important to always watch pricing and be competitive, no matter what competition there is.

“We’ve been here for 64 years,” he said. “And during those 64 years, we’ve had a lot of stores come and a lot of stores go. I don’t think it will have an effect on us whatsoever.”

Tags: Annex · News · General

1 response so far ↓

  • 1 Christopher King // Aug 9, 2012 at 7:58 pm

    I’m quite surprised that a Dollarama would have the nerve to open anywhere near Honest Ed’s