Dollar General is getting into ecommerce while continuing its focus on physical expansion.
Goodletsville-based Dollar General is in the thick of its first holiday season operating an online store. Like many retailers trying to lure customers, Dollar General is offering free shipping, but without any limits.
Retail analyst Mark Montagna with Nashville’s Avondale Partners was a little surprised by what’s available at DollarGeneral.com.
“Kaboom Foamtastic bathroom cleaner showed up, 19 ounces, four dollars.”
Even on a single bottle of dish soap or shampoo, shipping is free. It’s a gimmick to get customers to the new website, Montagna says. But he adds that Dollar General is really going after consumers who buy in bulk and trying to divert them to the online store.
“They’re hoping to capture more commercial organizations such as local schools, local businesses, churches, that would come into their store because of their pricing and clean them out of an entire item. So then they’re out of stock.”
Dollar General has not reported online sales figures. But CEO Rick Dreiling says he doesn’t expect ecommerce to become a large part of the company’s business, which is primarily focused on its nearly 10,000 brick and mortar locations.
“It’s not like it’s going to be a large part of our sales long term. It’s more of a convenience for our customers.”
Dollar General continues to make physical expansion the priority, adding roughly 600 stores this year. Montagna says the online store could help lead the way for brick and mortar locations.
“If you see certain zip codes that are very robust in purchasing Dollar General products, then you may easily decide to open a store right nearby.”
Company officials have said data from online shoppers could prove useful in locating new stores. And Dollar General plans to open even more in the coming year, including for the first time some in California.
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