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GOODLETTSVILLE, Tenn. — 2025 will be another year of “robust” expansion for Dollar General, according to CEO Todd Vasos.
The company this week revealed plans to open 575 U.S. stores in the fiscal year starting February 1 and up to 15 stores in Mexico. Also on tap are remodels at about 2,000 existing locations as well as upgrades of another 2,250 stores through its Project Elevate initiative to improve the shopping experience at stores not yet old enough for a full remodel.
“Collectively, we believe our planned real estate projects will further solidify Dollar General as an essential partner to communities in rural America while strengthening our foundation to drive long-term sustainable growth,” Vasos said on a December 5 conference call to discuss the company fiscal third-quarter financial results.
Expectations for new store returns remain “very strong,” Vasos said, but are down modestly from Dollar General’s historic target in the 20%-plus range due to higher store occupancy expenses and higher operating costs. “[We] continue to see significant opportunities for growth, with approximately 12,000 opportunities for Dollar General branded stores in the U.S.”
Citing weaker consumer trends in discretionary categories, Vasos said none of the new locations added in 2025 will be pOpshelf stores, a concept introduced a few years ago to pave the way for expansion into the suburbs.
Added Vasos, “We continue to expect average returns in our remodels that are consistent with what we have seen historically and are even greater than what we have seen from our new stores, driven by expected first year comp sales lifts in our full remodels of approximately 6% to 8%, on average.”
Core customer is 'financially constrained'
In its most-recent quarter, ended November 1, Dollar General reported revenue of $10.2 billion, up 5% from a year earlier and in line with analysts’ estimates.
Net income was down 29% to $196.5 million. DG said profits were hit by increased markdowns, increased inventory damages and a greater proportion of sales coming from the consumables category.
Same-store sales increased 1.3% and included growth in the consumables category, partially offset by declines in each of the home, seasonal, and apparel categories.
“While we continue to operate in an environment where our core customer is financially constrained, we delivered same-store sales near the top end of our expectations for the quarter,” Vasos said. “We believe our Back to Basics efforts contributed to these results, as we have continued to improve our execution and the customer experience in our stores.”
