Dollar General Tests Fresh Produce

Retailer cites positive results from store remodels that are testing fresh produce sales.

June 05, 2017

LENEXA, Kan. – Dollar General is encouraged by its efforts to add fresh produce to store remodels, reports Produce Retailer.

During a quarterly earnings call held June 1, Goodlettsville, Tenn.-based Dollar General executives said they’re encouraged by efforts to add fresh produce to the mix.

Todd Vasos, Dollar General’s CEO, said the retailer is adding fresh produce to about a third of the store remodels in progress. “The remodels include increasing the cooler set to 34 doors, an increase of about 160% on average from the existing cooler footprint for those locations,” he said. “This allows for a greater perishable assortment which helps drive trips and basket size.”

Produce Retailer writes that Vasos added that Dollar General is testing an assortment of fresh produce sales. “While it’s still very early, initial remodels are yielding strong same-store sales improvements,” he said, adding that those same-store sales improvements are about three times those in traditional store remodels without produce.

“When you look at stores that we put produce—and again, just keep in mind, it’s a very few stores—we have seen nice comp lifts in these stores,” Vasos said. “Produce is helping that comp, but even without that those stores are comping very, very well.”

The news source adds that Dollar General has established fresh produce divisions in its Dollar General Market stores, but most the company’s 13,600 stores do not stock fresh produce.

“We’re pretty excited about what we see there, but there’s still a lot more yet to figure out on these new stores as it relates to produce,” Vasos said during the call. “As you know, we’ve been in the produce business for only a short period of time in these stores, but we’ve got a lot of experience with them in our market stores, and we’ve taken the learnings from those and are applying them here.”

Produce Retail says that Dollar General is planning to add 1,290 new stores in 2017, having opened 293 in its first quarter that ended May 5. Dollar General reported $5.61 billion in sales during Q1, and a 0.7% increase in same store sales.

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