Daiso is the dollar store with one yen for the US market
What happens when you combine a dollar store with Muji, the darling of Japanese minimalist design?
You get Daiso.
With the opening of its latest store in the Las Vegas market, Japanese retailer Daiso now has over 80 locations in the US market, but more importantly, it is bringing an entirely new design and product sensibility to the industry.
Daiso, based in Japan – the name is a mash-up that roughly translates to “big manufacturing” – is technically a “100 yen (87 cents at the current exchange rate) store where almost everything in the store sells for that price. . The merchandising line includes literally thousands of items ranging from clothing, food, home, beauty, kitchen and traditional Japanese paper and craft items. It all has a classic Japanese design aesthetic, reminiscent of Muji but on a budget, unlike most of what you’ll find in traditional US dollar stores where it often seems like every expense has been spared for packaging and design. And while some items are more expensive, the values are impressive, just as thrifty as the old American dollar stores.
Such US chains as Dollar General and Dollar Tree/Family Dollar, each with some 15,000 locations, dwarf Daiso in the US market, but worldwide the Japanese retailer has more than 3,600 just in Japan and another 2,300 in the world in 24 countries and regions. It also started selling online last year in Japan and elsewhere in Asia, but doesn’t serve the North American market, at least not yet. (Shipping is often more than the cost of the goods.)
Daiso arrived in this country in 2005 and its current range of more than 80 stores is mainly concentrated in the west of the country, although it has opened stores in Texas, New York and New Jersey, in addition to a store in Canada. Locations tend to be in neighborhoods with high Asian populations, often in strip malls.
If the new Las Vegas store, which opened in December 2021, is any indication of the retailer’s popularity, there will most certainly be many more Daiso stores to come. Before it opened at 10 a.m. on a recent weekday morning, at least a dozen customers lined up outside waiting for the doors to open. Once they did, dozens more – many Asians, but also Latino and Anglo-Saxon individuals, families, teenagers and the occasional older man in business suits – joined them. and at 10:30 a.m. both registers had lines extending halfway into the 1,500-square-foot store. They carried baskets of snacks, stationery, socks, makeup, dishes and various other household items. Most were house brand, except for an occasional bag of American-brand salty snacks, and still had Japanese language packaging with an English sticker explaining the contents. Signs in the store offered price conversion charts, as many items were not priced individually in US dollars. These signs clearly stated that if there was no price at all on an item, it was $1.50, which is an increase from its home market price, but still an incredible bargain.
The store charges 20 cents for a bag of groceries and does not accept American Express, although it does accept other credit cards. Buyers that morning were only too happy to pay accordingly.
When Daiso opened its first store in New Jersey in 2019, senior Forbes contributor Joan Verdon noted a similar phenomenon of long lines of eager shoppers and suggested that while it was still modest in size , Daiso could one day be a serious competitor to existing retailers. “Dollar stores aren’t the only competitors to worry about. Craft stores and hobby shops should also keep an eye out.
Daiso’s US footprint is still relatively small, but when asking which retailers in the US market have the highest growth potential, representing a new merchandising format, Daiso should be near or top of that list. You can bet at least 87 cents on it.