Alongside the results from this year’s chili cook-off and details on the forthcoming changes to the curbside recycling program, the “New Dollar General to Open in [Insert Your Town Here]” story is a mainstay for local reporters across the U.S.
Following Dollar General’s robust late-March presentation to investors detailing its long-term strategic plans and what those plans mean in the near term, the American news-reading public can expect more variations on that headline in the coming years.
Dollar General (DG) has set a 7% to 10% annual target for net sales through 2020. The key means of hitting this target is expansion. And relocation. And remodeling. And an increase in same store sales (2% to 4%). But plenty of expansion. To the tune of
FY 2016: 900 new stores (+ 875 relocations and remodels)
FY 2017: 1,000 new stores (+ 900 relocations and remodels)
Historical Data Source: Chain Store Guide’s Discount Stores and Specialty Retailers Database. Data is not intended for investment decisions.
*Projection: Dollar General Corp.
Both the net number of new stores and the year-over-year growth are quite significant in a historical context, and though no direct mention was made during the investor presentation of the Dollar Tree acquisition of Family Dollar last summer and its now-combined 13,000+ store presence, it no doubt weighs heavily in DG planning.
Net units: These 1,900 store openings reflect an unprecedented level of expansion for the company, equaling in two years the number of stores opened in the previous three, which to date have been the three most productive years in DG history for store openings. In his investor presentation, CEO Todd Vasos labeled this as “aggressive growth, but
growth we can manage.”
Year-over-year growth: The FY 2016 and F2017 expansion plans equate to year-over-year store growth rates of 7.2% and 7.5%, rates Dollar General hasn’t produced since 2005 when the addition of 767 stores produced a 10.5% increase in total stores.
Historical Data Source: Chain Store Guide’s Discount Stores and Specialty Retailers Database. Data is not intended for investment decisions.
*Projection: Dollar General Corp.
Vasos also noted that Dollar General has identified 13,000 “growth opportunities” throughout the continental U.S. — locations well-suited for placement of a Dollar General store. He went on to say, “While we won’t get all 13,000, our goal is to get the lion’s share of those 13,000.”
“Getting close” to capitalizing on those 13,000 opportunities would get Dollar General close to doubling the 12,483 stores it had in place to close 2015. And serve reporters up with quite a few made-to-order stories.
