In the land of the cheap, Dollar General is king

In the discount retail market, which boomed in recent years with the recession and a decline in household wealth, Dollar General (NYSE:DG) is the cheapest of the cheap.

A study of prices by consumer research and consulting firm Kantar Retail found that Goodlettsville, Tenn.-based Dollar General offered the overall lowest-priced basket of products compared with its peers in the discount retail sector. This is the third straight year Dollar General came in with the least-expensive basket.

At a total of $26.75 for its basket, Dollar General beat out its competitor Wal-Mart by 2.5 percent. It also came in lower than Matthews-based Family Dollar (NYSE:FDO), which this year became a target for hostile acquisition by Dollar General.

Dollar General didn't dominate in every product category. Discount supermarket chain Aldi had the lowest bill for edible goods by $1.34 per basket compared with Wal-Mart, its nearest competitor in that category.

Kantar found Target to have the highest overall prices among the retailers it studied, with its total basket costing $40.61.

Family Dollar had the third-lowest-priced basket overall and didn't lead in any category. Said Mike Paglia, Kantar's director of retail insights: "Family Dollar struggles to provide shoppers with the means to stay on budget."

Kantar has more on its study here.

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