Dollar General is catering to a growing number of middle- and high-income households, a trend observed by the company’s CEO Todd Vasos. The discount retailer has seen its core lower-income customers face financial stress, with one-quarter of surveyed customers reporting reduced income and 60% saying they will have to sacrifice necessities in the coming year.
According to Vasos, Dollar General’s value proposition and new delivery options are attracting trade-in customers from higher-income groups. Shares of the company rose 16% after it released first-quarter results that beat expectations, with a forecasted increase for the year ahead.
In contrast, Ollie’s Bargain Outlet has seen its customers focus on immediate needs and consumer staples, driven by low prices near the end of the month when many shoppers’ money runs out. While the company surpassed analysts’ expectations, its shares fell 2% due to a lower forecast.
Dollar Tree is set to release its first-quarter results on Wednesday, with analysts predicting a 3.8% year-over-year increase in comparable store sales. However, tariffs and sluggish discretionary spending may impact its performance.
Source: https://www.investopedia.com/more-middle-and-high-income-earners-are-turning-to-dollar-general-ceo-says-11747386