Doug Stephens

Dollar General Getting Into Beer and Wine Biz

August 20, 2010

FROM RETAILWIRE:
Dollar General has done well selling consumables in other categories so why not try its hand at beer and wine? How big a competitive threat do you think dollar stores are to other retail outlets that currently sell beer and wine?      [more...]

Whether this works is almost beside the point. Frankly, there's no reason why it wouldn't generate incremental sales.

The bigger question however is about the future evolution of Dollar General. Anytime you begin to go wide, you cease to be deep. Dollar General's strength has been in the utter simplicity of its proposition. Loads of locations--dirt cheap stuff.

With this and other line expansions, DG threatens to water the proposition down and become just another general merchant. If that happens, they immediately put themselves at risk.