Dollar General to Open 730 Stores in 2015
Dollar General says it will open 730 new stores in 2015 and 900 new stores in 2016. The discount retailer, which was forced to abandon its unsolicited campaign to acquire rival Family Dollar, says it will also relocate or remodel 875 stores this year.
“At Dollar General, real estate is a core strength,” said chief operating officer Todd Vasos on an earnings call. “Our real estate model is disciplined and focused on financial returns. We’re very optimistic about our new store outlet for 2015 as our pipeline is full and the real estate team is already working on the pipeline for accelerated growth in selling square feet of approximately 7% in 2016.”
The discount retailer opened 700 new stores in 2014 for a total of 11,789 stores in 40 states (as of January 2015) and broke ground on a San Antonio, Texas distribution center, the company’s 13th overall.
CEO Rick Dreiling addressed the minimum wage hikes announced by Walmart and how it would affect Dollar General. All of the retailer’s full-time workers make more than the $7.25 federal minimum wage, but some of the part-time workers start out at the minimum.
“I think it’s fair to say the labor market conceivably is tightening up,” Dreiling added. “We’re going to keep our eyes, we’re going to continue to monitor the landscape and we’ll assess or make any adjustments that we need to make. But, right now, in terms of what we’re paying our people, we feel pretty comfortable that we’re there.”
Vasos hinted at some changes to the way Dollar General handles its workforce. “In anticipation of changes to the competitive landscape, we’ve been testing several different labor models to determine the potential impact on sales growth,” he said. “[…] in certain geographic areas, we can spend a little bit more time inside of our stores stocking and ensuring the customer experience is at the highest level that it possibly can.”
For the full fiscal year, Dollar General’s sales were up 8% $18.9 billion, a company record. Same-store sales for the year were up 2.8%.
