Dollar General, a leading discount retailer in the United States, has announced plans to invest $100 million in its stores, primarily focusing on staffing. This decision comes as the company aims to improve customers' in-store experience and address recent scrutiny and fines for unsafe working conditions.
Owned by an investment group consisting of affiliates of Kohlberg Kravis Roberts (KKR), GS Capital Partners (an affiliate of Goldman Sachs), Citigroup Private Equity, and other co-investors, Dollar General has managed to escape the 2022 bear market with its share price up by around 5% over the last 12 months. The company's recession-resistant business model and competitive advantages have contributed to its market-beating momentum.
CEO Jeff Owen revealed that the $100 million store-level investment will fund more store-level staffing and continue to attract and retain talent. This move is expected to enhance store standards and the in-store experience, ultimately driving more sales and capturing additional market share. In 2022, Dollar General created over 10,000 new jobs and currently operates just over 19,000 stores as of February.
The company's decision to increase staffing levels follows a disclosure by the U.S. Occupational Safety and Health Administration (OSHA) in January, citing repeated violations of unsafe working conditions in its stores. Since 2017, Dollar General has been fined more than $15 million for numerous willful, repeat, and serious workplace safety violations.
In the fourth quarter of 2022, Dollar General posted net sales of $10.2 billion, a 17.9% increase compared to the same period in 2021. Comparable-store sales rose 5.7% year-over-year in Q4, while operating profit was up 17.1%. The company also opened its 19,000th store in Joplin, Missouri, in January and recently debuted its first store in Mexico.
Dollar General's $100 million investment in staffing and stores demonstrates the company's commitment to improving its operations and customer experience. By addressing workplace safety concerns and enhancing store standards, Dollar General aims to maintain its strong market position and continue its growth trajectory in the coming years.
