Latest news with #Vasos
Miami Herald
30-06-2025
- Business
- Miami Herald
Huge discount retailer closing over 100 stores nationwide
When Starbucks closes a few hundred stores every few years, it's not a sign that the chain has a problem. Instead, it's a routine housecleaning. The chain, really every well-run chain, constantly evaluates its store portfolio. Sometimes, the economics on a certain location change, and it makes sense to close that store when its lease expires. Related: Bankrupt ice cream chain sold to popular beverage owners This happened on a wider basis after the Covid pandemic changed certain customer patterns. Many people stopped physically going into an office, and even after then pandemic, maybe only returned part-time. That made thousands of restaurants and coffee shops nationwide much less needed. They were built to serve those workers and once those workers disappeared, there often was not enough remaining business to support the store. When stores close like this it's generally not big news because there's a reason why the location shut down. In some cases, however, a store closing can be devastating for a community. Don't miss the move: Subscribe to TheStreet's free daily newsletter If an area loses its only grocery store, that can create huge problems for people who live there. But, even in areas where there are other options, losing a key discount player can hurt the community. Residents having fewer choices means that the remaining chains and stores in the area can charge more. That's something that many patrons of Dollar General cannot afford. Image source: Bloomberg/Getty Images In some areas, Dollar General (DG) fills the role of grocery store for its customers. Many of the chain's patrons have limited mobility options and Dollar General might be the only retailer that sells food within walking distance. The chain understands the important role it plays in many customers' lives and has made choices that embrace that. That's why thousands of Dollar General locations have added fresh produce - because there customers may not have easy access to it otherwise. Dollar General does not take the decision to close stores lightly, but it still closes them when it makes sense for business. That's something CEO Todd Vasos talked about during the chain's fourth-quarter earnings call. "As we look to build on the success of our back-to-basics work, we have undertaken a thorough review of our business to identify opportunities to further strengthen our foundation. With this in mind, we conducted a real estate portfolio optimization review of both our Dollar General and pOpshelf banners during the fourth quarter. As a result of the review of our Dollar General portfolio, we made the decision to close 96 stores," he shared. More Retail: Walmart makes drastic change amid alarming customer trendLowe's makes one of its largest ever billion-dollar acquisitionsSubway owner makes major billion-dollar fast food acquisitionAmazon makes a harsh decision amid concerning customer trend Vasos shared why the company made this decision, "While this is less than 1% of our overall store base, those stores, many of which are in urban locations, have become increasingly challenging to successfully operate. These stores likely would have been closed in the ordinary course of the store's lifecycle when their leases expired, however, we determined that closing these locations now will allow us to optimize our allocation of resources going forward," he added. In addition to its namesake brand, Dollar General also operates PopShelf, a rival to Five Below that sells low-priced household goods. "We're PopShelf. A stress-free shopping destination, just for you. We believe in bringing enjoyment back to shopping by making it easy to get things you need and fun to find things you want," the company shared on its website. "We've got every reason to shop. From party supplies, to DIY finds, surprises for the kids, trending beauty, and more." Dollar General also plans to close some PopShelf locations. "I also want to discuss the results of our PopShelf portfolio review. After analyzing business performance and revised outlooks for our current portfolio PopShelf locations, we identified 51 store closure candidates based on financial and operational considerations from our test and learn phase, Vasos shared. Some of the closing locations will be repurposed. "We plan to convert six of these 51 locations to Dollar General stores and close the remaining 45 stores. This will leave 180 stores remaining as part of the PopShelf banner," he added. Related: Popular furniture chain closing all stores, no bankruptcy Dollar General, he insists, remains committed to PopShelf. "As we enter 2025, we are optimistic about the PopShelf banner and our opportunity to drive improvements in our sales results as customers' feedback on the brand and shopping experience continue to be strong," he said. The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
New York Post
04-06-2025
- Business
- New York Post
Dollar General sees increase in higher-income shoppers looking to stretch their dollars
Dollar General is luring in more higher-income households as shoppers tighten their spending amid growing concerns around the economy. CEO Todd Vasos told analysts during the company's first-quarter earnings call on Tuesday that new customers this year are shopping more often and spending more per visit compared with new customers last year. They are also allocating more of their spending to discretionary categories. 'We believe these behaviors suggest that we are continuing to attract higher-income customers who are looking to maximize value while still shopping for items they want and need,' Vasos said. The company has seen more middle- and higher-income earners. During the three-month period ending in May, the company saw the highest percentage of these customers that it's seen in the last four years, according to Vasos. 'We are pleased to see this growth with a wide range of customers and are excited about our ongoing opportunity to grow share with them,' Vasos said. 3 Dollar General is attracting more high-end shoppers as regular customers have tightened their spending amid growing concerns about the current economic state of the country. REUTERS However, Vasos acknowledged that the company's core customer remains financially constrained. About 60% of them admitted in a recent survey that they felt the need to sacrifice some necessities in the coming year. Arun Sundaram, equity analyst at CFRA Research, told FOX Business that there are more higher-income households shopping at discounters, including dollar stores, mass merchandisers and club stores, in part because of 'growing price sensitivity amid persistent inflation and broader economic uncertainty.' 3 CEO Todd Vasos revealed that the company's first-quarter earnings show that new customers shopping are spending significantly more compared to new customers from a year ago. REUTERS While economic pressure is a factor, Sundaram said that 'retailers are also actively positioning themselves to appeal to a broader income base.' 'Dollar General is expanding its partnership with DoorDash, which supports higher-income household penetration through delivery convenience,' Sundaram said. 'Dollar Tree is also attracting more affluent shoppers by rolling out its multi-price point strategy to more stores, including introducing more discretionary items at $3 and $5 price points.' 3 Vasos said, 'these behaviors suggest that we are continuing to attract higher-income customers who are looking to maximize value while still shopping for items they want and need.' Getty Images He also cited Walmart's robust subscription program, Walmart+, as an example, saying it 'aligns well with its rapidly growing e-commerce business.' Walmart has also continued to gain higher earners in back-to-back quarters.
Yahoo
04-06-2025
- Business
- Yahoo
Why Dollar General Corporation (DG) Skyrocketed On Tuesday
We recently published a list of . In this article, we are going to take a look at where Dollar General Corporation (NYSE:DG)stands against other Tuesday's best performers. Dollar General grew its share prices by 15.85 percent on Tuesday to finish at $112.57 apiece as investors cheered the company's increasing number of middle- and high-income household customers. Dollar General Corporation (NYSE:DG), which mostly targets the low-income class, said Tuesday that it is now seeing an increasing number of middle- and high-income households checking out its offerings, a trend that it didn't experience for years. A busy shopping aisle filled with discounted items in a retail store. According to its CEO, Todd Vasos, the low-income shoppers, however, remain financially stressed. Based on its own study, Vasos said that one fourth of its surveyed customers reported having less income than a year earlier, while 60 percent said that they 'felt the need to sacrifice some necessities in the coming year.' In the first quarter of the year, Dollar General Corporation (NYSE:DG) netted $391.9 million, higher by 7.87 percent than the $363 million registered in the same period last year. Net sales also grew by 5 percent to $10.4 million from $9.9 million year-on-year. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey.
Axios
03-06-2025
- Business
- Axios
Dollar General sees uptick in middle- and higher-income customers
Customers spent more per trip at Dollar General last quarter, a sign that higher-income shoppers may be looking to save — and possibly stocking up ahead of expected tariffs. Why it matters: Dollar stores have been struggling as Americans turned to budding alternatives such as same-day delivery from the likes of Amazon and Walmart. Driving the news: Dollar General Tuesday raised its earnings forecast for the first time since the 2022 fiscal year, after beating revenue expectations with sales jumping 2.4% at stores open at least a year. The discount retailer set its all-time quarterly sales record of $10.4 billion as average transaction amounts rose 2.7% in the quarter spanning most of February, March and April. CEO Todd Vasos said on an earnings call Tuesday that while the company's core customer "remains financially constrained," Dollar General has seen more activity from both middle- and higher-income customers. Zoom in: The company is also avoiding a big blow from tariffs. Less than 10% of the company's goods come directly from foreign markets, Vasos said. It is mitigating impacts where it can, though Vasos said the company expects tariffs to result in some price increases "as a last resort." Yes, but: While the average customer spent more per trip, the number of customers visiting Dollar General stores declined by 0.3%.
NBC News
03-06-2025
- Business
- NBC News
Dollar General is shaking off tariff fears and winning over higher-income consumers
Shares of Dollar General jumped nearly 16% on Tuesday after the discounter raised its outlook, saying it drew more middle- and higher-income shoppers amid fears that higher tariffs would hurt consumer spending. The Tennessee-based retailer beat quarterly expectations for revenue and earnings. The company said it now anticipates net sales will grow about 3.7% to 4.7%, compared to its previous expectation of about 3.4% to 4.4%. It expects diluted earnings per share to range from $5.20 to $5.80, compared to its prior outlook of approximately $5.10 to $5.80. Dollar General anticipates same-store sales will increase 1.5% to 2.5%, higher than its previous guidance of about 1.2% to 2.2%. Here's how the retailer did for the fiscal first quarter compared with Wall Street's estimates, according to a survey of analysts by LSEG: Earnings per share: $1.78 vs. $1.48 expected Revenue: $10.44 billion vs. $10.31 expected In the three-month period that ended May 2, Dollar General reported net income of $391.93 million, or $1.78 per share, compared with $363.32 million, or $1.65, in the year-ago quarter. As of Tuesday's close, shares of Dollar General have risen about 48% so far this year. That far exceeds the roughly 1% gains of the S&P 500 during the same period. Shares of the retailer closed at $112.57 on Tuesday, bringing Dollar General's market value to $24.76 billion. Dollar General's first-quarter results — and its stock performance — stand out in a retail industry that is already taking a hit from President Donald Trump's tariffs. Companies including Best Buy, Macy's and Abercrombie & Fitch have cut their profit outlooks due to tariffs. On an earnings call Tuesday, Dollar General CEO Todd Vasos said the company has worked to reduce its exposure to China — and limit price hikes for shoppers. He said the retailer has worked with vendors to cut costs, moved manufacturing to other countries and made changes to its products or swapped them out for other merchandise. He said direct imports make up about a mid- to high single-digit percentage of its overall purchases and indirect imports are about double that. 'While the tariff landscape remains dynamic and uncertain, we expect tariffs to result in some price increases as a last resort, though, we intend to work to minimize them as much as possible,' he said. CFO Kelly Dilts said on the company's earnings call that full-year guidance assumes that Dollar General will be able to offset 'a significant portion of the anticipated tariff impact on our gross margin, but also allows for some incremental pressure on consumer spending.' Customer traffic dipped by 0.3% in the first quarter compared to the year-ago period, but shoppers spent more when they visited. The average transaction amount rose 2.7%, as sales in the food, seasonal, home and apparel categories all grew. Vasos added tariffs have also increased U.S. consumers' desire to find deep discounts. Vasos said the company's first-quarter results reflect Dollar General's gains from 'customers across multiple income bands seeking value.' He said store traffic and the company's market research indicates that more middle- and higher-income customers have come to its stores more frequently and spent more when they visited. 'We are pleased to see this growth with a wide range of customers and are excited about our ongoing opportunity to grow [market] share with them,' he said. Those gains have helped as Dollar General's core customer 'remains financially constrained,' Vasos said. According to a survey by the company, he said 25% of customers reported having less income than they did a year ago and almost 60% of core customers said 'they felt the need to sacrifice on necessities in the coming year.' Dollar General's sales largely come from U.S. consumers who are on a tight budget. About 60% of the retailer's sales come from households with an annual income of less than $30,000 per year, Vasos said last fall at a Goldman Sachs' retail conference. In addition to wooing value-conscious shoppers, Dollar General has tried to tackle company-specific problems that drew government scrutiny and tested customer loyalty. The discounter, which has more than 20,000 stores across the country, has paid steep fines to the Labor Department for workplace safety violations due to blocked fire exits and dangerous levels of clutter. Vasos highlighted some of the ways that Dollar General has tried to improve the customer experience. Among them, it's worked to reduce employee turnover, and it took about 1,000 individual items off its shelves so it can keep top-selling items in stock, he said. Dollar General has launched its own home delivery service, which is now available at more than 3,000 stores. Its deliveries through DoorDash have grown, too, with sales up more than 50% year over year in the quarter. Dollar General has also bulked up its merchandise categories outside of the food and snack aisles, adding more discretionary items like seasonal decor and home items. Vasos said sales in those categories have also gotten a boost from middle- and higher-income customers shopping its stores. Its newer store chain, Popshelf, sells mostly discretionary items and caters to consumers with higher household incomes than Dollar General's typical shoppers. Vasos did not share a specific metric for the chain, but said Popshelf's same-store sales delivered strong growth in the quarter. The company recently changed the store layout to emphasize toys, beauty and party candy.
