Dollar General Buys Competitor Dollar Express
Dollar General confirmed its plans on Monday to buy all 323 stores in 36 states from Dollar Express, the chain of former Family Dollar stores owned since late 2015 by the private equity firm Sycamore Partners. The Charlotte Observer reports that up to 2,700 part-time and full-time store employees of Dollar Express may be losing their jobs. Multiple Dollar Express employees told the Observer they were informed that their last day of employment would be on or around June 2 since Dollar General is not retaining any of them. Stores will begin their liquidation processes soon, said the employees.
Total Retail's Take: Further consolidation in the dollar store category is upon us with Dollar General's proposed acquisition of Dollar Express. Considering the retail climate in which they operate, dollar stores have fared rather well over the last couple of years. From 2010 through 2015, the top four chains grew their combined total annual sales from $28 billion to an estimated $42 billion, representing a compound annual growth rate (CAGR) of 8.5 percent. Dollar General sees an opportunity to grow its marketshare in today's "discount economy," and is using acquisition as a means to accomplish its goal. In 2014, Dollar General unsuccessfully tried to buy Family Dollar (which was later acquired by Dollar Tree), but is hopeful its acquisition of Dollar Express gains regulatory approval.