Capitalizing on Convenience

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Consumers living in congested urban neighborhoods typically expect to pay more when they shop in nearby stores for convenience purchases of milk, bread and other household items.

Dollar General Corp., a discount general store chain with more than 12,500 stores, sees a growth opportunity in that: The chain has opened a new concept store that adds food and drinks to its typical merchandise mix while keeping prices low.

DGX stores have been designed to go into urban communities with vertical living and work environments; at 3,400 square feet, the stores are about half the size of traditional Dollar General stores.

“This is an opportunity to appeal to and serve the urban customer, particularly Millennials with spendable incomes,” says Dan MacDonald, senior director of corporate communications. “Dollar General would like to keep its customers from having to get in a car and drive five miles to a supermarket or discount retailer.”

The first DGX opened in January in Nashville; a second opened in February in Raleigh, N.C. Stores stock about 60 percent of the items found in a traditional DG store; the product mix also includes freshly brewed coffee, a healthy food station with salads, wraps and other sandwiches and an express checkout.

MacDonald says management feels that “people who live in urban areas are looking for value as well as convenience, but it’s not as easy to find the value as it is the convenience. I think that’s a big differentiator for us with DGX.”

DGX
Goodlettsville, Tenn.
Owner: Dollar General Corporation
Locations: 2

 

 

Liz Parks is a Union City, N.J.-based writer with extensive experience reporting on retail, pharmacy and technology issues.

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