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Dollar General Unveils New Store Concept Aimed at Higher-Income Shoppers

Dollar General announced a new retail store concept called Popshelf aimed at higher income buyers.

Popshelf is part of the Dollar General Corporation and, according to the company, will be a differentiated store and shopping experience. In a press release announcing the company, the company said that every 9,000-square-foot Popshelf store will focus on delivering a combination of constantly updated merchandise, seasonal specials and time-limited items.

"We're leveraging this trend that we saw in experimental retail before the pandemic hit," Chris Pappas, deputy director of the Net Lease Division of Marcus & Millichap, told GlobeSt.com. “It's this treasure hunt idea that keeps changing the offers in the stores. The reason people will come in is because of this element of surprise. They will be offering seasonal decor, which means it will change every season of the year. "

The first two Popshelf locations will open near Nashville in the communities of Hendersonville, Tennessee and Clarksville, Tennessee. Dollar General plans to have approximately 30 locations in different markets by the end of fiscal 2021. The company is primarily aimed at female customers and is located in a variety of suburban communities with total household incomes between $ 50,000 and $ 125,000.

"If you look at Dollar General, they have nearly 17,000 stores and a huge logistics system, and they're focused on this more rural area," says Pappas. "I think they were looking for a way to tap into this slightly more affluent other consumer base with a business that makes sense in the suburbs."

According to Dollar General, popshelf shelves will also feature a highly curated crossover range of Dollar General's private labels, many of which have recently been renamed. The company says roughly 95 percent of the items in the Popshelf will be priced at $ 5 or less.

Dollar General starts Popshelf at a time when Dollar shops are flourishing compared to other retailers. In the second quarter, cap rates for dollar stores fell 12 basis points year over year, according to The Boulder Group.

Dollar stores have been successful because they offer an immediacy that Amazon cannot yet offer.

"Dollar stores currently give customers access to inexpensive goods, while Amazon has to deliver, which takes time," says Pappas. “According to the latest data from GlobalData Retail, 75 percent of Americans are within five minutes of a Dollar General. In addition, a critical mass of New Dollar stores is opening up in secondary and tertiary markets where Amazon does not have the logistics infrastructure to profitably deliver low-cost goods the next day. "

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