Dollar General to open 900 new stores

Dollar General is anticipating the opening of 900 new stores in 2016, compared with 730 in 2015. The increase in square footage is 7 percent, up from 6 percent this year.

CEO Todd Vasos made the announcement in conjunction with the news that John Garratt has been named exec-VP and CFO, succeeding David Tahle, who will retire in June, Supermarket News reported.

In order to accommodate the new stores, the company will begin constructing a new fulfillment center in Janesville, Wisconsin, and shipments from a new distribution center in San Antonio, Texas, will begin in February.

Sales increased 7.3 percent to $5.1 billion for the quarter and same-store sales were up 2.3 percent. Dollar General's consumables increased at a higher rate than non-consumables, with a significant growth driven by candy, snacks, tobacco and perishables.

Vasos hinted that the company will roll out a new store format in 2016 that includes a more customer-friendly layout, faster checkout and optimized assortments.

Changes include an increase from 16 to 22 doors for beverages, frozen, dairy and perishables. Plus, there will be a change in the health and beauty offerings and seasonal items.

"We spent a lot of time on the front side with our consumers, seeing what she wanted in the new store," Vasos said, according to Seeking Alpha. "But the great thing about what we're able to deliver in this new format is a more convenient front end for our consumer."

These changes at Dollar General come as competition in the dollar store format continues to grow. Last month, Family Dollar announced the debuted of 330 stores under its new banner, Dollar Express.

In 2014, Dollar General lost a bidding war when Dollar Tree (NASDAQ:DLTR) and Family Dollar merged.

For more:
-Read this Supermarket News article
-See this Seeking Alpha transcript

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