Despite tariffs uncertainty, Dollar General and Dollar Tree show that they're still operating in a sweet spot
Dollar General shares shot up 7.2% to close at a record high. Dollar Tree stock closed up more than 3%.
Part of dollar stores’ growing appeal is their doubling down on convenience-store-type offerings. Both retailers have added more coolers and freezers to stock perishable and other refrigerated items to attract customers. Dollar General in March also rolled out DG Fresh to take distribution of perishable items in-house to help cut product costs and better keep them in stock.
Both retailers also are expanding in nonconsumable items like party merchandise that are more profitable than the traffic-driving daily essential goods. Dollar General, for instance, unveiled a Believe Beauty private-label cosmetics line and said it’s adding more home and seasonal merchandise, which Vasos said has had a positive “halo effect” in helping to increase consumables sales.
That move, which risks alienating some shoppers, could be necessary, especially as dollar store chains brace for different cost pressures. Both companies, for instance, said higher fuel prices had increased transportation costs.
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