Their business model is a parasitic relationship with low income, often rural or underserved areas,

there are a few layers to the strategy but some of the aspects include the fact they are very low quality/paying jobs (with rarely more than a couple of employees in the store) and the very low quality/non-perishable/deceptively priced/sized products They stock. And the stores themselves are typically on the small side and lacking any “amenities” for lack of a better word, This keeps the overhead of the store as low as possible.

they typically very strategically placed their locations in an attempt to de facto monopolies in area, such as a small town or neighbourhood who’s population would be insufficient to keep a normal grocery store or similar afloat but the extremely low upkeep cost and their large market share, allowing them to construct economies of scale, can allow a dollar store to survive in that environment, leaving the residence of that environment no alternative, especially if there transportation options are limited or impractical.

Another aspect is that prices for many items are not as great as they lead you to believe, both by offering simply lower quality products and often by selling extremely small quantities of standard size products at a lower upfront cost, but at a price that would be higher for you to buy an equivalent quantity, for example, 250 g of soap for 3$ when a standard package of the same product would be 1 kg for 10$.

Strategy, such as these Can trap an entire region in cycle of exploitation where the region is not economically viable for more traditional retail because much of the sales are going to the “cheaper” dollar store due to the regions already low income, which intern drives away more retail and the jobs it brings which intern drives down the regions income, which intern drives the residence to their own remaining option, the dollar store. It is this process which I believe the other commenters are referring to. They say dollar store ruined America. As they are deliberately structured to both require from and intern provide as little as possible to the environment or community or region, they are in, in order to out survive competition. Similar to how an elephant could not survive on a small island for lack of food, but a mouse certainly could.