3. Situation Analysis Dollar Store Concept – Woolworth Five and Dime – Strength Dollar General – 1939 – Turner family Wholesale to retail 1955- Kentucky Strong Mission Oriented Culture – Family 8,260 stores in 35 states 1990s – Expanded its product mix
4. Situation Analysis Majority of prices- $10 or less 30% - $1 or less Average store- excess of 1 million dollars Mission – Serving the customer Middle to lower class consumer Competes – convenience and price Example – 20 mins. compared to 50 mins.
8. Alternatives Introduce Dollar General presence in California Market expansion – Urban Areas Market expansion – Small, rural towns Joint venture with Walgreens Increase services offered- Money services Increase services offered- Pharmacy
9. Alternatives Change Retail Store Format Develop a Strategic Alliance with Wal-Mart Horizontal Integration International Expansion into Canada – US Border Cities Go private Expansion of products
10. Discussion Time Do you see any similarities/differences between our solutions and yours?
12. Introduce Dollar General Presence in California Pros Large market Currently no major extreme-value presence Cons Cost Possible Rejection Advertising
13. Market Expansion – Urban Areas Pros New customer base High consumer traffic Cons High Expense Potential low customers interest High cost of advertising
14. Market Expansion – Rural Areas Pros Experience/relative ease Low competition from Wal-Mart Established presence in similar areas Low cost Cons Small customer base No new customer base High profits unlikely
15. Joint Venture with Walgreens Pros 253.6 billion dollar industry Leads industry- $39.5 billion in sales Diversify Sustainability Supply Chain Management Cons Cost Legal fees Implementation Time Focus
17. Pharmacy Pros 253.6 billion dollar industry Increase customer base Substantial profits Added convenience to current market Cons Expensive Liability Strict Regulations
18. Change Retail Store Format Pros Close under-performing stores More selling space Customer perception Cons Poor customer reception Rising prices Implementation cost
19. Strategic Alliance with Wal-Mart Pros Increased sales Improved location Cons Difficult to maintain business relationship Different company focuses
20. Horizontal Integration Pros Increased market share Cons Potential monopoly High costs Expected gains may not materialize
21. International Expansion in US – Border Cities Pros Bigger Reach New Market EVD widely accepted internationally Cons Risky Cultural Differences Hurt chances of success
22. Go Private Pros Focus on long term Goals and Objectives Sustainability Cons Could hurt in short term Less Publicity
23. Expansion of Products – Grocery Section Pros Wider variety of customers Compete with Wal-Mart Cons Lose dollar store feel Costly Time, effort, and money
