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Dollar General Thrives on Better Pricing, Decent Comps Run
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Better pricing, private label offerings, effective inventory management, and merchandise initiatives have helped Dollar General Corporation (DG - Free Report) in carving out a niche in the retail space. Markedly, the company’s everyday low-price model is anticipated to drive traffic persistently. Thanks to its status of “essential retailers,” this Goodlettsville, TN-based company has been benefiting from coronavirus-induced spike in demand.
Under the current circumstances, people are exhibiting a preference for discount stores for essentials or other daily purchases. Apparently, Dollar General has emerged as viable option for them. The company’s differentiated product range resonates well with customers’ spending habits.
Cumulatively, aforementioned factors have been aiding Dollar General’s performance, which shares space with Target (TGT - Free Report) , Costco (COST - Free Report) and Dollar Tree (DLTR - Free Report) .
Let’s Introspect
Dollar General’s impressive same-store sales growth story continued in fiscal 2020. After increasing 21.7% in the first quarter, same-store sales surged 18.8% year over year during the second quarter, primarily owing to rise in average transaction amount. Consumables, Seasonal, Apparel and Home categories favorably impacted the metric. Management stated that change in consumer behavior due to the coronavirus pandemic had a favorable impact on the performance.
Same-store sales improved 21.5% in May, 17.9% in June, and 17.2% in July. Dollar General informed that since the end of the second quarter, it has continued to witness “elevated demand” across its stores. Consequently, from Aug 1 through Aug 25, same-store sales have risen roughly 15% compared with prior-year period.
In order to increase traffic, Dollar General has been focusing on both consumables and non-consumables categories. The company has also been offering better-for-you products at affordable prices. Additionally, it has been expanding cooler facilities to enhance the sale of perishable items.
During the first half of fiscal 2020, the company installed more than 30,000 cooler doors across its store base, and plans to install roughly more than 60,000 cooler doors in the year. Notably, the company has been expanding DG GO! mobile checkout. Moreover, the company’s DG Pickup initiative, which is buy online and pickup in store, has also been gaining traction.
Management has introduced two transformational strategic initiatives — DG Fresh, designed to enable self-distribution of fresh and frozen products, and Fast Track, an in-store labor productivity and customer convenience initiative. By the end of fiscal 2020, the company plans to operate at least ten DG Fresh distribution facilities, which will serve roughly 14,000 stores.
As part of its non-consumable initiative, the company is now focusing on categories of home, domestics, housewares, party and occasion. The non-consumable initiative offering was available across more than 4,300 stores at the end of the second quarter. The company plans to expand the offering to about 5,400 stores by the end of fiscal 2020.
Wrapping Up
It’s abundantly clear that in spite of a tough retail landscape, Dollar General has been thriving, when several traditional operators are finding it difficult to cope.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
Image: Bigstock
Dollar General Thrives on Better Pricing, Decent Comps Run
Better pricing, private label offerings, effective inventory management, and merchandise initiatives have helped Dollar General Corporation (DG - Free Report) in carving out a niche in the retail space. Markedly, the company’s everyday low-price model is anticipated to drive traffic persistently. Thanks to its status of “essential retailers,” this Goodlettsville, TN-based company has been benefiting from coronavirus-induced spike in demand.
Under the current circumstances, people are exhibiting a preference for discount stores for essentials or other daily purchases. Apparently, Dollar General has emerged as viable option for them. The company’s differentiated product range resonates well with customers’ spending habits.
Cumulatively, aforementioned factors have been aiding Dollar General’s performance, which shares space with Target (TGT - Free Report) , Costco (COST - Free Report) and Dollar Tree (DLTR - Free Report) .
Let’s Introspect
Dollar General’s impressive same-store sales growth story continued in fiscal 2020. After increasing 21.7% in the first quarter, same-store sales surged 18.8% year over year during the second quarter, primarily owing to rise in average transaction amount. Consumables, Seasonal, Apparel and Home categories favorably impacted the metric. Management stated that change in consumer behavior due to the coronavirus pandemic had a favorable impact on the performance.
Same-store sales improved 21.5% in May, 17.9% in June, and 17.2% in July. Dollar General informed that since the end of the second quarter, it has continued to witness “elevated demand” across its stores. Consequently, from Aug 1 through Aug 25, same-store sales have risen roughly 15% compared with prior-year period.
In order to increase traffic, Dollar General has been focusing on both consumables and non-consumables categories. The company has also been offering better-for-you products at affordable prices. Additionally, it has been expanding cooler facilities to enhance the sale of perishable items.
During the first half of fiscal 2020, the company installed more than 30,000 cooler doors across its store base, and plans to install roughly more than 60,000 cooler doors in the year. Notably, the company has been expanding DG GO! mobile checkout. Moreover, the company’s DG Pickup initiative, which is buy online and pickup in store, has also been gaining traction.
Management has introduced two transformational strategic initiatives — DG Fresh, designed to enable self-distribution of fresh and frozen products, and Fast Track, an in-store labor productivity and customer convenience initiative. By the end of fiscal 2020, the company plans to operate at least ten DG Fresh distribution facilities, which will serve roughly 14,000 stores.
As part of its non-consumable initiative, the company is now focusing on categories of home, domestics, housewares, party and occasion. The non-consumable initiative offering was available across more than 4,300 stores at the end of the second quarter. The company plans to expand the offering to about 5,400 stores by the end of fiscal 2020.
Wrapping Up
It’s abundantly clear that in spite of a tough retail landscape, Dollar General has been thriving, when several traditional operators are finding it difficult to cope.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>