Dollar General appears to have reversed course on ambitious growth plans for its brick-and-mortar fleet despite a strong 2024 fiscal year and Q4. In December 2024 Dollar General said it would open 575 stores and remodel 4,250 others during FY 2025, which ends in January 2026. However, during Q1, the discount retailer plans to shutter 141 stores, including 96 Dollar General and 45 Popshelf locations, and convert an additional six Popshelf stores to the Dollar General banner. The retailer will still operate 180 Popshelf stores following these updates.
“As we look to build on the substantial progress we made on our Back to Basics work in fiscal 2024, we believe this review was appropriate to further strengthen the foundation of our business,” said Todd Vasos, CEO of Dollar General in a statement. “While the number of closings represents less than 1% of our overall store base, we believe this decision better positions us to serve our customers and communities.”
During a conference call discussing the results, Vasos noted that many of the stores slated for closure are located in urban locations and have become “increasingly challenging to successfully operate.”
“These stores likely would have been closed in the ordinary course of the store’s lifecycle when their leases expired, however, we determined that closing these locations now will allow us to optimize our allocation of resources going forward,” Vasos added.
Advertisement
For FY 2024, Dollar General’s net sales increased 5% to $40.6 billion, up from $38.7 billion in FY 2023. Comparable store sales grew 1.4%, reflecting a 1.1% increase in customer traffic and a 0.3% increase in average transaction amount. For Q4, net sales climbed 4.5% to $10.3 billion, up from $9.9 billion generated during Q4 2023, while comparable store sales increased 1.2%.
