Dollar General Corporation - Internal Environment Analysis

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DECLARATION

I, Ameya Thakur do hereby declare that this project report titled “Dollar General Corporation- an Internal Environment Analysis” prepared under the guidance of Prof. K G Sahadevan is my individual effort. No part of the report is copied from published/unpublished sources without proper citation.

The information included in this report is true to the best of my knowledge. I also hereby declare that this project report has not been submitted at any time to any other university or institute.

Table of Contents

DECLARATION        

EXECUTIVE SUMMARY        

INTRODUCTION        

BUSINESS POLICY        

CODE OF BUSINESS CONDUCT        

MANAGEMENT STRUCTURE        

STRENGTHS        

SMALL BOX OPERATOR        

ECONOMICAL        

PRODUCT MIX        

WEAKNESS        

BRAND IMAGE        

FINANCIAL PERFORMANCE        

EXECUTIVE SUMMARY

Dollar General Corporation is a discount merchandise retailer with its head office in Tennessee, USA. It was founded in 1939 by J.L Turner in Kentucky and since managed to grow into a top reatil company with more than 12,000 stores across United States. It has hassle-free shopping experience at the core of its business model. Dollar General manages to provide deep discounts to shoppers because of the heavy cost reduction and efficiency they are able to achieve. However, quality of any product is not compromised which has helped Dollar General retain and increase their customer base substantially over the years.

In spite of the heavy competition with deep-pocket retailers like K-Mart and Walmart, DG has managed to grab a significant share of the retail market by keeping the focal point as the rural and semi-urban American consumer who prefers to shop for the value for money goods at cheaper rates. The stagnant economy of US has further led to an increase in this segment of the population leading to even faster growth of the Dollar retail stores. The report tries to identify in depth the factors internal to the firm which have resulted in the rapid growth and expansion of Dollar General Corporation.

INTRODUCTION

Dollar General started out with the very simple concept that no item in the store should be charged more than a dollar and that is how it got its name.The first store opened in Springfield, Kentucky with the vision of J.L. Turner. He began by buying bankrupt general stores during the Depression which helped fuel the growth of Dollar General. The company went public in 1968 to be registered as Dollar General Corporation. The signage however still remains Dollar General to continue the legacy of value associated with it. Currently, Dollar General has over 12300 stores across 43 states in the United States.

VISION & MISSION

The two words that are made very clear in Dollar General’s mission statement are substance and simplicity. DG’s mission is “Serving Others” and that substance and simplicity help them achieve this mission effectively. The goal as identified by the company is to provide their customers with a better life and their employess opportunity and a great working environment.

BUSINESS POLICY

The focus for Dollar General thus remains providing convenience for their customers. It is stated that a regular shopping trip to a Dollar General store takes less than 10 minutes. The stores are designed and stacked in such a way that it is easy for customers to find what they are looking at. Also not all brands are kept in DG stores, just the most popular ones. The hassle-free experience is the purpose behind the design of every DG store.

 Almost 75% of DG’s products are consumables and daily use products that customers cannot wait for. The everyday low price model has worked very well for DG. The focus to serve and make life easier for their shoppers has been the backbone of Dollar General’s business strategy.

The three cornerstones of Dollar General’s business policies are:

1. Almost 30% of Dollar General’s merchandise is priced at $1 or less even today.
2. DG operates small stores with an average size of 7,200 square feet and are primarily focused on selling consumable merchandise to make shopping for basic necessities simple and hassle-free.
3. Dollar General Stores are concentrated mostly in under-served neighborhoods which are not on the radar of large discount retailers.

CODE OF BUSINESS CONDUCT

Dollar General publishes and periodically revises its code of conduct document. Every new employee is required to submit their responses in the form of the Certification & Disclosure form after reading and understanding the code of conduct document thoroughly.

Following are certain highlights of Dollar General’s Code of Conduct:

1. Non-Retaliation Policy :

DG encourages employees to report any unethical or wrong practices they notice or are subject to. Action is taken based on the information received. It is promised that there will be no retaliation towards the employee for any honest report of such kind be it towards any individual or process.

1. Higher Expectations from Managers :

Dollar General states that managers have a bigger role to play and a greater responsibility towards maintaining the code of conduct in the organization.