Dollar General Corporation, often referred to simply as Dollar General, is an American chain of variety stores. Established in 1939 by J.L. Turner and Cal Turner, the company has grown into one of the largest discount retailers in the United States. Dollar General stores offer a wide range of consumer goods, including household items, cleaning supplies, apparel, food, health and beauty products, and more, typically at lower prices compared to traditional retail outlets.
The company operates over 18,000 stores in various locations across the U.S., serving customers in both rural and urban areas. Dollar General’s business model focuses on providing everyday low prices and convenience to customers, attracting a broad customer base.
Over the years, Dollar General has experienced significant growth and success, expanding its store network and boosting its annual sales revenue. Despite facing challenges related to workplace safety and macroeconomic conditions, the company remains a dominant player in the retail industry, continually evolving and adapting to meet the needs of its customers.
On Thursday, the company reinstated Todd Vasos as CEO with immediate effect to provide stability to the business. Vasos takes over from Jeff Owen, who assumed the role just last November.
Vasos, who previously held the position of CEO from June 2015 to November 2022, intends to continue in this role for the foreseeable future. He aims to steer the company towards recovery after facing underwhelming financial quarters and penalties due to the exposure of employees to unsafe working conditions.
CHALLENGES AHEAD
The discount retail giant fell short of projections for two consecutive quarters, grappling with a range of challenges including decreased customer footfall, inventory shrinkage, reduced inventory markups, and inventory damages. Additionally, a larger proportion of its sales have been attributed to the consumables category, which typically yields lower profit margins.
Previously, Owen had informed analysts that the macroeconomic landscape proved to be more demanding than anticipated for their primary customer base. In August, the company revised down its profit and sales forecasts. Furthermore, federal occupational safety inspectors found in July that Dollar General stores in Tampa had exposed their employees to fire hazards and other unsafe conditions. The U.S. Department of Labor stated that this situation reflects an ongoing pattern of neglect for worker safety by one of the nation’s largest discount retailers.”
According to the Department of Labor, since 2017, the company has incurred over $21 million in OSHA fines through 243 inspections conducted nationwide.
Board Chairman Michael Calbert expressed confidence in Vasos’ capability to realign the company’s focus. He stated, ‘Dollar General has maintained a robust position for nearly 85 years, and the Board firmly believes that Todd possesses the apt leadership to reorient the company’s strategic vision and priorities, ultimately ensuring business stability.’
Vasos, in his seven-year tenure as CEO, is recognized for steering the company ‘through a phase of notable transformation, marked by accelerated growth and innovation.’ During this period, the company expanded its retail footprint by 7,000 locations, generating an addition of nearly 60,000 jobs. Annual sales revenue witnessed a remarkable surge of over 80%, and the market capitalization more than doubled.
‘I am eager to rejoin the collective effort of the team as we endeavor to restore operational excellence for both our employees and customers. Our goal is to achieve sustainable long-term growth and deliver value creation for our shareholders,’ stated Vasos in a released statement.