Dollar General and Dollar Tree were supposed to do well in good times and bad. Thanks to inflation and chaotic store experiences, that's not the case.
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The Lede
Back in May 2020, when the pandemic was just beginning, Dollar General CEO Todd Vasos summed up the resilience of his chain. "We do very good in good times, and we do fabulous in bad times," Vasos said on an earnings call. The numbers backed it up: Despite COVID, Dollar General was doing better than ever and had just smashed expectations for its first quarter. But four years later, Dollar General — and Dollar Tree, its main rival — are seeing a slowdown.
Key Details
- Dollar General's same-store sales for 2023 rose just 0.2 percent, a much slower clip than the 4.3 percent it posted for 2022, according to earnings released in March.
- Dollar Tree is closing 1,000 Family Dollar stores after spending nearly a decade trying to integrate the chain into its business.
- Some of the troubles facing dollar stores are partly due to the economy and many shoppers having to cope with higher prices. But there are also self-inflicted issues that both of the major chains are dealing with.