Reporter's notebook - shopping at Dollar General - Column

Discount Store News, Sept 4, 1995 by Richard Halverson

Following an ample luncheon after Dollar General's annual meeting back in June, it seemed the natural thing to take in a guided tour of its Scottsville store.

It's not exactly your typical DG store, which tends to be located in low-rent strip malls, more often in a suburban, rather than a rural setting.

Instead, the Scottsville store occupies a prime corner on the town square in this sleepy town of some 5,000 souls 19 miles off the interstate and a few miles north of the Tennessee border.

It's really not even a square as such, just the central crossroads through town, with only four-way stop signs to control traffic.

But the offerings were vintage DG basic merchandise, starting with goods displayed in a perpetual sidewalk sale, including: buckets, $2; folding picnic tables, $15; rattan laundry baskets, $3; and 20-in., three-speed box fans, $12.50.

That's outside the hard lines entrance of the store, which meanders down a slight hill. On the uphill side, customers can walk directly into the apparel and shoe level of the store. A ramp connects both levels to make it easier to get down to basic hard lines.

No need for shopping carts here with just 2,500 skus in stock. That reflects DG's philosophy: being a low-cost distributor of just the basics at the lowest possible price, even if it means cutting the selection of work boots from five to three.

Once inside, my tour guides, Ernie Cunningham, footwear buyer, and David Miles, seasonal and toys buyer, sort of became my personal shoppers as we selected my DG outfit.

We started with a hot new item, stonewashed jeans, made in the Middle East, at $10. Then on to a Jerzee knit shirt at $5. I passed on the canvas shoes, made in China, at $2.50, even though Ernie said DG will sell a million pairs this year. But I couldn't resist a $1 pair of cotton socks that Goody's Family Clothing had commissioned as a private label product.

But the trend is toward national brands, not closeout goods, such as the socks, Cunningham said.

I also passed on the Kentucky Wildcats licensed T-shirt, also $5. (I love not having to worry about those odd-penny prices. Who's kidding who with a $4.99 price?).

Fruit of the Loom men's briefs were $3.50 for a three-pack, T-shirts were $5.

I was a bit puzzled to see ties at $3.50, since DG carries no dress shirts. Somebody must have gotten a good buy

Ernie and Dave were kind enough to carry my purchases so I could take notes.

I resisted the temptation to wear my DG outfit to an interview with chairman Cal Turner the next day. He would have gotten a laugh out of it, though, I'm told.

Rubber mucking boots at $10 were still on the shelves, thanks to requests from local dairy farmers. But it's one of the boots that have been cut chainwide to hold down costs.

I could have splurged on the most expensive item in the place, patchwork quilts, looking like the expensive, handcrafted items that the mountain folk of Kentucky sell. But at $35, these were made in China and Spain.

Every year, DG likes to cut the prices on 10 to 12 highly visible items, so that shoppers say "wow." Previous "wows" include the $5 resin chair, now standard in discounting, and the $12.50 box fan ($14.97 at Wal-Mart, my hosts insist), and 1-gal. of bleach for 75 cents (down from 85 cents last year).

In private label products, DG likes to provide Dollar General Signature quality, offering goods with Cal's signature and offering a money-back guarantee. A prime example is dandruff shampoo, claimed to be head and shoulders above a certain, famous national brand at $2 for a 15-oz. bottle.

In diapers, DG offers no brand choice, just its private label at $6 for a bale of 26, large boys.

DG is bringing in more national brands to replace private label offerings. In film, it now offers Scotch film at $2 for a 24 exposure roll of 35 millimeter 200 ASA. But at the same price, 110 is its most popular size.

About 85% of hard lines come bearing a price that the vendor prints on. That makes it easy for a chain that disdains shelf pricing and scanning. DG bought new POS registers last year, but doesn't use them to scan prices. That would raise costs, in its book, by forcing it to hire more headquarters staff in data processing.

Apparently it's cheaper to get clerks to punch in those $1 and $2 prices.

Keep it simple, after all, is the DG motto.