Dollar General, Family Dollar continue local growth spurts

Convenience, more items, pricing drawing shoppers as Dollar General and Family Dollar expand to more neighborhoods

tadams@ledger-enquirer.comJanuary 3, 2014 

Brandy Finley says her affinity for shopping at dollar stores boils down to their two primary attributes — convenience and price.

On Friday, the Columbus resident was browsing through the latest Dollar General store (2500 Hamilton Road) to open in the local market, with friend Austin Kirkland pushing a buggy as she deposited soft drinks, snacks, toilet tissue and other household items into the cart.

“We live right down the road and we don’t have vehicles, so we can walk here. It’s just more convenient for us,” said Finley, 38, who also frequents Family Dollar, spending $10 to $15 on average during each visit.

No doubt, it appears dollar stores are popping up on every other corner. It’s not the case, of course, although within sight of the new Dollar General on Hamilton Road is a Family Dollar under construction, its parking lot yet to be paved.

The growth in the dollar shopping segment is plainly visible, however, with Dollar General having opened a store on Cusseta Road in Columbus in September and another on Broad Street in Phenix City last May.

A quick check of the Dollar General website finds no fewer than two dozen stores in the Columbus-Phenix City market, ranging up to Fortson and Cataula in Georgia and down to Seale and Fort Mitchell in Alabama.

Family Dollar, meanwhile, has at least 16 stores in the general vicinity, with another popping up on Crawford Road in Phenix City and the one now being finished on Hamilton Road. Another chain, Dollar Tree, has a half dozen in the market thus far.

Convenience and pricing are key factors for many shoppers using the low-cost outlets. But an expansion in the types of merchandise offered also has been a draw, with newer Dollar General stores becoming small grocery stores offering everything from bacon and eggs to frozen dinners and ground beef. Toys, DVDs, greeting cards and even underwear are on the shelves.

Gayle Gomez on Friday was filling a shopping basket, forgoing a trip to the local Walmart a few miles away for the closer proximity of the new Dollar General.

“It’s not just convenience. The prices are good,” said Gomez, 38, with her two daughters, Maria, 8, and Iyanna, 7, in tow. “Today, I bought snacks, some makeup, dog food, stuff for my kids, stuff for the house.”

Dollar General already lays claim to having more locations than any other retailer in the U.S., with it expected to end its latest November-January quarter at 11,061 stores nationwide.

But there’s more on the way, and plenty of them.

“By the end of January we are hoping to have completed 650 new stores,” said Crystal Ghassemi, public relations manager for Goodlettsville, Tenn.-based Dollar General. “And then, starting in February, we’re looking forward to our fiscal year ’14 when we’ll actually open 700 new stores across the country.”

Ghassemi noted Dollar General just completed its 24th consecutive year of same-store sales growth, with those sales and new store openings occurring before and during the Great Recession the U.S. is now putting behind it.

“I think a lot of people don’t understand that we do well in good economic times as well,” she said. “There’s an assimilation that bad economics means that the dollar channel is doing really well.”

The retailer’s profits show that to be the case in its last quarter ending in October, with net income climbing 14 percent to $237 million. That was on net sales of $4.38 billion, up 10.5 percent from the same quarter in 2012.

Matthews, N.C.-based Family Dollar racked up a profit of $102 million on $2.5 billion in net sales in its fourth quarter that ended in August. The chain opened 500 stores in its fiscal year 2013, with plans to add 525 more this year. It has about 7,900 stores nationwide.

Chesapeake, Va.-based Dollar Tree, meanwhile, pulled in net income of $125 million on net sales of nearly $1.9 billion in its last quarter ending in October. The retailer has roughly 5,000 stores in the U.S., opening 117 in its last reported quarter.

GRAND OPENING

As is customary, the new Dollar General store at 2500 Hamilton Road, Columbus, will have a grand opening celebration on Saturday starting at 8 a.m. It will include $10 gift cards to the first 50 adult shoppers and 200 tote bags to the first 200 shoppers.

“It’s just to say thank you and we appreciate you guys allowing us in the neighborhood,” said Sam Powell, general manager of the store, which is not far from Rose Hill Seafood restaurant.

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