As Dollar General captures more grocery spend, its produce offerings are expanding.
As Dollar General strives to capture more consumer grocery spending, fresh produce has taken on increasing importance to that plan, as a new initiative in Louisiana shows.
The discount retailer on Tuesday announced that two recently remodeled stores in Baton Rouge, the state capital, now have fresh vegetables and fruit for sale. The retail chain also said that it offers a “curated assortment of produce” in about 650 of its more than 16,000 locations.
This focus on fresh fruits and vegetables stems from the retailer’s broader efforts to expand its grocery selections as well as local political pressure. Dollar General said its new produce offerings reflect the ongoing push by Baton Rouge’s mayor to educate residents about how to improve their own nutritional habits and otherwise encourage wider consumer access to fresh fruits and vegetables.
“Today’s announcement on additional produce options in Baton Rouge represents numerous constructive conversations with Mayor-President (Sharon) Broome, her entire staff and the Geaux Get Healthy Initiative. It also demonstrates the possibilities when cities and companies to work together to find solutions for their communities,” said Jason Reiser, Dollar General’s executive vice president and chief merchandising officer.
Dollar General this year plans to add fresh produce selections to 400 stores across the country, “up from a previous goal of about 250 stores, bringing the total number of stores with produce to more than 1,000 by year-end,” said chief operating officer Jeff Owen in March during the fourth-quarter financial report conference call with analysts. “We are also accelerating the expansion of our fresh produce offering, which provides the Top 20 items typically sold in traditional grocery stores and covers approximately 80% of the overall categories they carry,” he said.
Over the past year, as Dollar General worked to increase the revenue it earns from food retail sales, some local governments around the country have tried to apply pressure on discount retailers such as Dollar General to sell more fresh food. Supporters of that idea argue that more fresh food from such retailers would improve the nutrition and health of consumers who don’t always have easy access to traditional supermarkets and grocers.
DG Fresh Growth
Fresh produce is not the only way that Dollar General wants to increase its appeal among food shoppers. The retailer’s DG Fresh effort focuses on self-distribution of frozen and refrigerated goods to at least 4,900 stores and counting. “Given our DG Fresh learnings and successes to date, we recently began incorporating higher capacity coolers into our stores, creating additional opportunities to drive higher on-shelf availability and deliver a wider product selection,” Owen also said during that March conference call.
A new update on that program and the retailer’s most recent grocery trends should come on Thursday, when Dollar General is scheduled to release its first quarter 2020 financial results. For the full year 2019, the retail chain said that 78% of its $27.7 billion in sales came from food and consumables.