According to Barbara Farfan, two-thirds of the U. growth domestic product comes from retail consumption (Farfan, 2014). Additionally, the future of the U.S. economy is usually determined by the increase in retail sales. In 2011, retail sales totaled $4.7 trillion, which represented an 8% increase from 2010 (Farfan, 2014). This indicated economic recovery was underway and the future of the U.S. economy was expansion and not recession. In 2010, 14.4 million individuals were employed in the U.S. retail industry (U.S. Bureau of Labor Statistics, 2011). Although the retail employment numbers were up every month at the beginning of 2010, retail employment numbers were the lowest they had been in 10 years (U.S. Bureau of Labor Statistics, 2011). Declining retail jobs and increased job competition were major contributors to the low retail employment numbers. Job employment is a reason why the U.S. retail industry is currently struggling. In 2008, Deloitte predicted the U.S. retail industry would continue to struggle because of the housing market crash, high gas prices, and high unemployment rates (Deloitte, 2008). In order to combat the effects of the struggling retail industry, retailers are recommended to create private labels, reintroduce coupons, improve the customer experience, and lower payroll (Farfan, 2014).
Dollar Tree recently set plans to acquire Family Dollar in an $8.5 billion deal that could put an end to Walmart's dominance as the number one retailer. The combined chain will have 8,000 more stores than Walmart and play into the shift of customers' buying preferences and patterns (Thau, 2014). The convenience of small stores such as Dollar Tree and Family Dollar have become more attractive as customers are now finding the supercenter model by Walmart less appealing because of an unpleasant shopping experience. Also, according to retail analyst Charles Grom, Walmart's "always low prices" are now being beaten by Family Dollar's prices.
