Dollar General Goes Online
Albeit 16 years after Amazon.com was first launched, Dollar General will finally introduce e-commerce capabilities on its website today in a bid to provide more convenience for consumers.
"Dollar General is excited to meet the growing demand for online convenience and value," said Rick Dreiling, chairman and CEO, in a statement. "We have streamlined the online shopping experience, giving customers what they need, as well as what they want, 24 hours a day, seven days a week, 365 days a year."
On its second-quarter conference call last week, Mr. Dreiling said the website will initially offer over 1,000 of its current SKUs to customers "who like many of you may not have a convenient Dollar General," including those living outside its 35-state market area.
"We plan to sell single items as you would find in our stores as well as larger quantities that we stock in our stores. And from time-to-time, we’ll also feature limited quantities of special buys," said Mr. Dreiling. That includes unique items only available at dollargeneral.com and not in stores.
Asked by an analyst to gauge the size of the e-commerce opportunity, Mr. Dreiling said he’d have to wait until it’s been up and running for awhile. He said, "This is brand new for us. We do know that there has been request for it. We do know there is demand for it, but I just don’t know enough yet about what it’s going to generate. And with the world of social media today, I mean, it’s a great hookup for us now."
While its largest competitors, Wal-Mart and Target, started conducting e-commerce operations in the nineties, its nearest competitor, Family Dollar, doesn’t offer e-commerce. Dollar Tree added e-commerce in April 2009 in part because customers were looking to buy in larger quantities not always available at each store. It also offers free shipping when a customer chooses to ship their order to one of Dollar Tree’s stores.
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Discussion Question: What do you think of the e-commerce opportunity for Dollar General and other dollar store operators?