Where Dollar General Is Opening Store After Announcing Huge Closures

Dollar General is opening a store in Orlando, Florida, amid a spree of closures nationwide.

The discount retailer previously said it would be shuttering 96 units over the next several weeks.

Why It Matters

Many retailers have faced reduced demand as high inflation and the pandemic have lowered brick-and-mortar traffic.

Despite being known for its low costs for the everyday consumer, Dollar General has also opted to close a large number of underperforming locations.

What To Know

Dollar General’s new store opening in Orlando arrived at a time when the retail giant had sometimes focused on slimming its store footprint.

However, Dollar General has differentiated itself from other retailers, which have frequently reported net losses in revenue.

In the chain’s most recent earnings report, Dollar General saw a year-over-year growth of 4.5 percent in net sales and a 5 percent annual increase to $40.6 billion.

Newsweek reached out to Dollar General for comment via email.

“We were pleased with the underlying performance of the business in the fourth quarter, including improved execution and solid top-line results,” Dollar General’s chief executive officer Todd Vasos said previously. “As we reflect on our full fiscal 2024 year, we believe our Back to Basics work is resonating with customers, as demonstrated by higher customer satisfaction scores and healthy market share gains.”

The stores the chain has chosen to shutter in the weeks ahead were generally selected based on performance and operating conditions.

Vasos added: “While the number of closings represents less than one percent of our overall store base, we believe this decision better positions us to serve our customers and communities.”

Top discount store competitor Dollar Tree announced it would be closing almost 1,000 Dollar Tree and Family Dollar locations over the next several years.

What People Are Saying

Elizabeth Lafontaine, director of research at Placer.ai, told Newsweek: “The greater Orlando area has seen an influx of residents since the pre-pandemic period. Not only is the Orlando area a draw for new residents, but its position as a top U.S. travel destination presents an opportunity to Dollar General to strengthen its footprint in the area. Dollar General’s store fleet reduction strategy is likely in response to changing market conditions across the country and changing population demographics.”

Kevin Thompson, a finance expert and the founder and CEO of 9i Capital Group, told Newsweek: “Orlando is Florida’s fastest-growing metro area in terms of population, making it a natural choice for Dollar General’s expansion. As more people move to the region, demand for affordable retail options increases — aligning perfectly with Dollar General’s value-driven model.”

Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek: “I think when Americans hear about nationwide closures,they think automatically every location could be on the chopping block. The reality is with major retailers that have hundreds or thousands of locations, you’re going to have sites that overperform and make the retailer consider expanding or even opening new sites. Orlando may not be drawing in as many new residents as it did at the peak of the pandemic, but it remains a hot market for incoming residents and, of course, one of the busiest tourist sites in the world.”

What Happens Next

Retailers have been looking to upgrade store formats and close underperforming locations in recent years as a result of consumer demand shifts, and this includes Dollar General.

“Dollar General and other retail chains in the dollar and discount category have an opportunity to provide a strong value proposition to consumers in the current economic climate and further change the consumer perception of the dollar store channel as it evolves,” Lafontaine said.

Thompson said Dollar General’s future will largely depend on the larger economic conditions.

“While the chain is often seen as recession-resistant due to its focus on low prices, a deep recession could still trigger additional store closures,” Thompson said. “Historically, when Dollar General locations begin to underperform, it can serve as a broader economic barometer, indicating financial stress among lower-income consumers.”