Dollar General to open 1,110 stores in 2022; plans international expansion
Dollar General unveiled aggressive expansion plans that includes its first stores outside of the U.S. and the acceleration of the rollout of its more upscale Popshelf store concept.
The discounter’s 2022 real estate plans include 1,110 new stores — including its first stores in Idaho, its 47th state — and 1,750 remodels. Dollar General will also open its first international stores, with plans to open up to 10 locations in Mexico.
“The opportunity to expand our footprint to serve communities in Mexico marks an exciting new era for our organization, and is a reflection of our continued innovative spirit and dedication to serving others,” said Todd Vasos, CEO, Dollar General.
Similar to its U.S.-based stores, Dollar General’s Mexico locations are expected to offer a curated assortment of products that customers use and replenish often, such as food, pet, cleaning and paper products, fresh goods, as well as discretionary non-consumable items.
“We are taking what makes DG great in the U.S. and adapting it to the Mexican retail landscape and feel strongly that our unique proposition will resonate with the Mexican consumer,” said Jeff Owen, COO Dollar General.
In the United States, Dollar General’s store plans include the acceleration of its Popshelf concept as it looks to nearly triple the store count next year. Launched in fall 2020, Popshelf is targeted at wealthier, younger and suburban shoppers who love looking for a good deal, with the vast majority of items priced at $5 or less. Looking further out, the retailer is targeting a total of approximately 1,000 Popshelf locations by fiscal year-end 2025.
Dollar General is also testing an in-store Popshelf format. It has opened 14 Popshelf shops inside its larger format DG Markets, with more to come.
The company revealed its real estate plans in its third-quarter earnings release. Net income totaled $487.0 million, or $2.08 per share, in the quarter ended Oct. 29, down from $574.3 million, or $2.31 per share, from the year-ago period. Analysts had expected earnings per share of $2.01
Net sales rose 3.9% to $8.5 billion from $8.2 billion last year, topping estimates of $8.496 billion. Same-store sales fell 0.6%, and Increased 11.6% on a two-year stack basis.
Last week, Dollar General rival Dollar Tree announced it was rolling out a $1.25 price point to all Dollar Tree stores nationwide. The discounter has not yet revealed its store plans for 2022. The move comes as inflation and supply chain disruptions are pushing up the cost of many goods for retailers.
Dollar General updated its guidance for fiscal 2021 “as a result of its strong results in the first three quarters of the year.” It now expects sales growth of 1% to 1.5%, versus previous guidance for 0.5% to 1.5%, same-store sales decline of 2.5% to 3%, versus previous guidance for a decline of 2.5% to 3.5%, and earnings per share from $9.90 to $10.20, compared with the previous expectation of $9.60 to $10.20.
Dollar General is the largest U.S. retailer by store footprint, with more than 18,000 stores in 46 states in the continental United States. Approximately 75% of the U.S. population residing within five miles of a Dollar General store.
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