- As sales of processed foods remain stagnant, food companies are looking to connect with lower socioeconomically based customers in discount and dollar store grocery aisles, where they can offer certain products at a lower retail price.
- These lower prices are often an illusion, however, as the packaging of these products tends to be smaller, which leaves the price per ounce often much higher than traditional product lines.
- By selling more of these products, smaller profit margins can still yield larger total profits for food companies.
Part of the reason the sales of processed foods have been flat or on the decline as of late is because more consumers are shying away from center-of-the-store grocery products in lieu of fresher foods found along the outer rim. Consumers of a lower socioeconomic class, however, cannot always afford these fresher foods, so they stick to center aisles, particularly at dollar stores, such as Family Dollar and Dollar Tree, which have recently been approved for a merger. To appeal to these consumers, food companies offer smaller packages and single-serving meals in dollar stores, like Kraft's Velveeta, which has breathed new life into sales of these product lines.