The U.S. retail sector's hurting? Dollar General plans expansion with 400 new jobs



Hurricanes Harvey and Irma drove more customers to its stores, helping boost quarterly sales past expectations. Fred Katayama reports.
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Dollar General’s rapid growth continued Wednesday as the discount retailer announced plans for its 17th U.S. distribution center, a facility that’s expected to create approximately 400 new jobs.

Projected for an early-2018 construction start in Longview, Texas, the nearly 1 million square foot facility will help supply the company’s nearly 1,400 stores across the state, Dollar General CEO Todd Vasos said.

The expansion comes weeks after Tennessee-based Dollar General said it would open 900 new locations to its roster of nearly 14,000 stores. Applauding the growth, investors have sent Dollar General’s stock up nearly 26% in 2017, making the company a bright spot in a retail sector troubled by store closings and bankruptcies.

Dollar General (DG) shares were unchanged at $92.48 in Wednesday morning trading.

“We look forward to the facility helping better serve our customers with value and convenience, as well as creating career opportunities for approximately 400 future Dollar General employees,” Vasos said in a statement issued with the Texas expansion plan.

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Sears Holdings, Macy’s, J.C. Penney and other major U.S. retailers have been closing stores as they try to cope with changing consumer tastes and the growing shift to e-commerce.

In contrast, Dollar General is expanding. As 2017 draws to a close, the year is expected to become the 27th in a row of sales growth in stores open at least one year. The company’s market capitalization, now roughly $25.1 billion, edges the $24.5 billion for Kroger, the largest U.S. grocery chain.

Dollar General’s corporate strategy focuses in part on opening stores in rural and exurban locations that are often located miles from the nearest Walmart or other major retailers.


Dollar General is trying to improve service by giving a big raise to its store managers.

In recent years, the company has also expanded that focus to include stores in parts of New York City, Chicago, and other major urban centers. Dollar General has also boosted salaries and training for store managers.

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After issuing the company’s third-quarter earnings report on Dec. 7, Vasos told investors and Wall Street analysts in a conference call that 75% of the U.S. population would likely be within five miles of a Dollar General store by the end of the company’s current fiscal year.

Dollar General stores typically stock cereal, milk, laundry detergent, pet food and other sundries, in some cases in smaller sizes to help customers keep their costs down. A typical customer buys about five items per shopping trip for an average basket cost of approximately $12, ” Vasos said during the conference call.


As the retail game changes, studies show that women are losing more jobs in the industry while men get more opportunities.

“Not all segments of retail are hurting,” Mickey Chadha, vice president of Moody’s Investors Service, said in a Dec. 7 note about the company’s latest earnings report. “The combination of low prices, broad assortment, and convenience will allow Dollar General to continue to grow as the income demographic primarily shopping at the stores has a limited amount of dollars to spend per visit and continue to find the value proposition very attractive.”

Follow USA TODAY reporter Kevin McCoy on Twitter: @kmccoynyc


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