Dollar General is dominating in America. Here's how it keeps its prices so low. (DG)

pulse

August 30, 2018 7:32 PM

While competitors have been squeezed by growing competition from Amazon, Dollar General and the dollar-store sector in general have flourished, swooping in and offering customers prices that are 20% to 40% lower than grocery and drug stores.

The dollar chain is bucking the retail trend and expanding rapidly in the United States. It plans to open 900 new stores by the end of the year, remodel 1,000, and relocate 100.
It offers prices that are 20% to 40% lower than grocery and drug stores,
capitalizing on a growing trend toward more cost-conscious shopping.
Here's how it keeps its prices so low.

"Even in a good economy, she [the customer] is still looking for value and convenience," he said.

Its stores are predominantly based in rural locations.

It's a no-frills shopping experience.

It has a limited selection of products.

It keeps labor costs down.

"That gift is being to give," CEO Vasos said in a call with investors in August, explaining that staff turnover rates are lower this year versus last year.

"We have seen the lowest percentage of open store manager positions across our company," he said. "It shows us that we made the right decision on wages."

It carries private label goods.

Dollar General currently has around 40 unique private label product lines. These products have higher margins than national brands as t

It stocks limited amounts of fresh produce.

Dollar General packages items in small quantities.

It looks to cut costs in the supply chain.

By growing its private fleet, management believes it will reduce its exposure to third-party carrier price fluctuations.

It is investing in technology to prevent shoplifting.

This also helps to drive sales as there are more items on the shelves available to buy.

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