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99 Cents Only Stores May Break The Dollar Barrier

99 Cents Only, which pioneered the single-price retail concept in 1982 in Los Angeles, has expanded to 277 locations in California and the Southwest. But 99 cents isn't what it used to be, and CEO Eric Schiffer admits that change may be overdue. "When you are part of a family that comes up with a concept, sometimes you're the last to admit that it needs to be changed," he says.

The deep-discount retailer sells groceries, household supplies and health and beauty products, and remains one of the few true "dollar" stores. Family Dollar Stores, a chain of more than 6,500 discount stores, is advertising Glad trash bags for $4.99 and Huggies diapers for $9.99, for example.

When eggs became too expensive, 99 Cents Only temporarily began offering six-packs instead of a dozen to keep prices under a dollar. The company also reduced the size of its milk cartons and stopped selling items such as peanut butter and cooking oil on a regular basis. "What's the point -- why not sell a standard size and price it accordingly?" says Joan Storms, an analyst who follows the chain for Wedbush Morgan Securities.



Read the whole story at Los Angeles Times »

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