Generally speaking
Discount retailer Dollar General had some of its value stripped yesterday, with shares sinking nearly 20% to a 3-year low point after an earnings report that saw the company temper its outlook as revenue grew just 6.8% year-over-year to $9.3 billion, some way short of estimates.
That's compounded quite a rough patch for Dollar General — the chain store is facing scrutiny over employee security with investors forcing through a safety audit — as well as for the dollar store industry more widely. Indeed, just last week fierce competitor Dollar Tree’s Q1 report told a similarly-disappointing story.
Dime a dozen
While dollar stores don’t always strictly stick to the price point their names suggest, though they aren’t often far off. That’s made the retailers particularly popular in recent years as more American shoppers turn to discounters for low-cost staples. Big brands are following too, with companies like Kraft Heinz and Hershey’s reportedly looking to increase shelf presence in the booming budget stores.
Even if sales have started to lag a little, America's increased appetite for the discounters has certainly been reflected in the retailers' location counts. In 2012, there were 10,506 Dollar General stores in the US, last year that number was up over 80% to a whopping 19,104. Dollar Tree has shown similar growth, with locations up 74% in the same period, adding even more outlets under its umbrella after acquiring Family Dollar in 2015. At one point it was estimated that the 3 chains collectively accounted for ~45% of US store openings in 2021.
