Dollar General Q1 results came in softer than expected, as Dollar General’s core consumers continue to cut back on discretionary spending. The company plans to scale back on new store openings and pOpshelf expansion. Check out MPG’s Dollar General Q1 2023 Earnings Recap for a quick summary and our takeaways.
As the value channel continues to be impacted, how should you adjust your strategies? Reach out to Courtney O’Grady for more insights that can help in today’s inflationary environment.
KEY TAKEAWAYS
Q1 results came in softer than expected
Consumables drove to the same store sales growth this quarter, as consumers continue to cut back on discretionary spending
As a result of Q1 earnings, Dollar General is planning to scale back on new store openings for 2023
Q1 HIGHLIGHTS
MARGIN CHALLENGES
While margin saw a positive increase driven by higher inventory markups & lessened transit costs, it was offset by increased shrink, markdowns, damaged inventory & increased consumable sales
POPSHELF EXPANSION
Popshelf, which caters to higher-income, suburban consumers, may not open as many stores as planned in 2023 due to the slowing of discretionary spending
CONSUMER SPENDING HABITS
While DG's core consumer continues to cut back on discretionary spending, higher-income consumers are trading down, but not enough to drive them to dollar retailers
“We are controlling what we can control and have made significant progress improving our execution on multiple fronts, including out supply chain recovery efforts and enhancements to the customer experience with our previously announced investment in incremental labor hours. In addition, we executed more than 800 real estate projects, including new store openings in our larger footprint Dollar General formats, which continue to outperform our expectations, and drive higher sales productivity compared to our traditional stores.”
- Jeff Owen, CEO
ADDITIONAL ARTICLES
Dollar General slashed its full year outlook after missing Wall Street’s estimates on the top and bottom lines
