How Dollar General became rural America’s store

Editor’s note: “Dollar General is expanding because Rural America is struggling.”

“The local Dollar General store, built on a rural highway and surrounded by farmland, sells no fresh meat, greens or fruit. Yet the 7,400-square-foot steel-sided store has most of what Eddie Watson needs,” The Wall Street Journal is reporting in a major feature article.

“The selection echoes a suburban drugstore chain, from shower curtains to breakfast cereal, toilet paper, plastic toys and camouflage-pattern socks. Refrigerators and freezers on one wall hold milk, eggs and frozen pizza.

“Many items are sold in mini bottles or small bags, keeping costs lower than a trip to the Wal-Mart Supercenter down the road. The two registers are staffed by one cashier, except during rush hours after school and after work.

“‘It’s just closer,’ said Mr. Watson, a 53-year-old construction worker who filled his cart with cans of chicken soup, crackers, cold cuts and toilet paper. ‘We call this the Evensville Wal-Mart.’

“The store, 10 miles from the nearest small town, is one of three locations in Rhea County where Dollar General plans to open stores by next year. More than one in five people there receive government food assistance, higher than the U.S. average, and the county has Tennessee’s highest unemployment rate.

“Dollar General is expanding because rural America is struggling. With its convenient locations for frugal shoppers, it has become one of the most profitable retailers in the U.S. and a lifeline for lower-income customers bypassed by other major chains.

“Dollar General Corp.’s 14,000 stores yielded more than double the profit of Macy’s Inc. on less revenue during its most recent fiscal year. And its $22 billion market value eclipses the largest U.S. grocery chain, Kroger Co., which has five times the revenue.

“The retailer relies on rapid store growth to keep revenue climbing and investors happy; 2016 marked its 27th consecutive year of sales growth in stores open at least a year.

“While many large retailers are closing locations, Dollar General executives said they planned to build thousands more stores, mostly in small communities that have otherwise shown few signs of the U.S. economic recovery.

“The more the rural U.S. struggles, company officials said, the more places Dollar General has found to prosper. ‘The economy is continuing to create more of our core customer,’ Chief Executive Todd Vasos said in an interview at the company’s Goodlettsville, Tenn., headquarters.

The rest of the article is here.

Author: jeffpelline

Jeff Pelline is a veteran editor and award-winning journalist - in print and online. He is publisher of Sierra FoodWineArt magazine and its website SierraCulture.com. Jeff covered business and technology for The San Francisco Chronicle for years, was a founding editor and Editor of CNET News, and was Editor of The Union, a 145-year-old newspaper in Grass Valley. Jeff has a bachelor's degree from UC Berkeley and a master's from Northwestern University. His hobbies include sailing and trout fishing.

One thought on “How Dollar General became rural America’s store”

  1. Besides struggling economically, rural areas also have poorer health which the cheap junk food stores like dollar General sell probably contributes to, not to mention the local stores that will be hurt. Letting these cheesy stores build is a mistake on a number of levels besides the advantage of cheap goods and convenience.

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