Dollar General 2014 Annual Report Download - page 76

10-K
PART I
ITEM 1. BUSINESS
General
We are the largest discount retailer in the United States by number of stores, with 11,879 stores
located in 43 states as of February 27, 2015, primarily in the southern, southwestern, midwestern and
eastern United States. We offer a broad selection of merchandise, including consumables, seasonal,
home products and apparel. Our merchandise includes high quality national brands from leading
manufacturers, as well as comparable quality private brand selections with prices at substantial
discounts to national brands. We offer our merchandise at everyday low prices (typically $10 or less)
through our convenient small-box locations, with selling space averaging approximately 7,400 square
feet.
Our History
J.L. Turner founded our Company in 1939 as J.L. Turner and Son, Wholesale. We were
incorporated as a Kentucky corporation under the name J.L. Turner & Son, Inc. in 1955, when we
opened our first Dollar General store. We changed our name to Dollar General Corporation in 1968
and reincorporated in 1998 as a Tennessee corporation. Our common stock was publicly traded from
1968 until July 2007, when we merged with an entity controlled by investment funds affiliated with
Kohlberg Kravis Roberts & Co. L.P., or KKR. In November 2009 our common stock again became
publicly traded, and in December 2013 the entity controlled by investment funds affiliated with KKR
sold its remaining shares of our common stock.
Our Business Model
Our long history of profitable growth is founded on a commitment to a relatively simple business
model: providing a broad base of customers with their basic everyday and household needs,
supplemented with a variety of general merchandise items, at everyday low prices in conveniently
located, small-box stores. We continually evaluate the needs and demands of our customers and modify
our merchandise selections and pricing accordingly, while remaining focused on increasing profitability
and returns for our shareholders.
In fiscal year 2014, we achieved our 25th consecutive year of same-store sales growth. This growth,
regardless of economic conditions, suggests that we have a less cyclical business model than most
retailers and, we believe, is a result of our compelling value and convenience proposition.
Compelling Value and Convenience Proposition. Our ability to deliver highly competitive prices on
national brand and quality private brand products in convenient locations and our easy ‘‘in and out’’
shopping format create a compelling shopping experience that distinguishes us from other discount
retailers as well as convenience, drug and grocery retailers. Our slogan ‘‘Save time. Save money. Every
day!’’ summarizes our appeal to customers. We believe our ability to effectively deliver both value and
convenience allows us to succeed in small markets with limited shopping alternatives, as well as to
profitably coexist alongside larger retailers in more competitive markets. Our value and convenience
proposition is evidenced by the following attributes of our business model:
•Convenient Locations. Our stores are conveniently located in a variety of rural, suburban and
urban communities, currently with approximately 70% serving communities with populations of
fewer than 20,000. In more densely populated areas, our small-box stores typically serve the
closely surrounding neighborhoods. The majority of our customers live within three to five miles,
or a 10-minute drive, of our stores. Our close proximity to customers drives customer loyalty and
trip frequency and makes us an attractive alternative to large discount and other large-box retail
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