Introduction
Dollar General, a leading discount retailer in the United States, has been serving millions of customers since its founding in 1939. With over 16,000 stores across 46 states, the company has become a go-to destination for affordable household essentials, food, and personal care products. However, many shoppers may be surprised to learn that Dollar General also sells a wide range of tobacco products, including cigarettes, cigars, and e-cigarettes.
In this comprehensive guide, we will explore the history and growth of Dollar General, the types of tobacco products available at its stores, the process of purchasing these products, and the reasons behind the company‘s decision to sell them. We will also examine the controversy surrounding tobacco sales at dollar stores, compare Dollar General‘s offerings to those of its main competitor, Family Dollar, and discuss the potential impact of these sales on public health and corporate social responsibility.
The History and Growth of Dollar General
Dollar General was founded in 1939 by J.L. Turner and his son, Cal Turner Sr., in Scottsville, Kentucky. The company initially operated as J.L. Turner and Son, with a focus on selling affordable, high-quality products to rural communities. In 1955, the company officially changed its name to Dollar General Corporation and began to expand its reach beyond Kentucky.
Over the years, Dollar General has grown through a combination of organic expansion and strategic acquisitions. In 1968, the company went public on the New York Stock Exchange, and by 1975, it had reached $100 million in sales. In the 1980s and 1990s, Dollar General continued to expand, opening new stores and acquiring other discount retailers, such as Eagle Family Foods and Clover Stores.
In recent years, Dollar General has focused on expanding its presence in urban and suburban markets, while also investing in e-commerce and digital capabilities. In 2020, the company reported net sales of $33.7 billion, a 21.6% increase from the previous year, and opened 1,000 new stores, bringing its total store count to 16,979.
Types of Tobacco Products Available at Dollar General
Dollar General offers a diverse selection of tobacco products to cater to the preferences of its customers. The most common items include:
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Cigarettes: Popular brands such as Marlboro, Newport, and Camel are available at most Dollar General locations. According to a 2019 study by the Campaign for Tobacco-Free Kids, approximately 74% of Dollar General stores sell cigarettes, with an average price of $5.79 per pack.
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Cigars: Both single cigars and cigar packs from well-known brands like Swisher Sweets and Black & Mild are sold at Dollar General. The same study found that 85% of Dollar General stores sell single cigars, with an average price of $0.99 per cigar.
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E-cigarettes: Disposable e-cigarettes and vape pens, particularly from the brand Blu, are offered at many Dollar General stores. The popularity of e-cigarettes has grown significantly in recent years, with sales increasing by 122% between 2017 and 2018, according to the CDC.
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Chewing tobacco: Customers can find various brands and flavors of chewing tobacco, such as Grizzly and Copenhagen, at Dollar General. A 2017 study by the Truth Initiative found that 61% of Dollar General stores sell chewing tobacco, with an average price of $4.99 per tin.
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Rolling tobacco and accessories: Dollar General also sells rolling papers, filters, and loose tobacco for those who prefer to roll their own cigarettes. These products are often displayed alongside other tobacco items at the checkout counter.
Purchasing Tobacco Products at Dollar General
To purchase tobacco products at Dollar General, customers must provide a valid form of identification to verify their age. The legal age to buy tobacco products in the United States is 18 years old, although some states have raised the minimum age to 21. Dollar General adheres strictly to these age restrictions and trains its employees to check IDs before completing any tobacco product sale.
All tobacco products are sold exclusively at the checkout counter, and customers cannot access them directly from the store shelves. This measure helps prevent theft and ensures that all tobacco sales are properly tracked and regulated. According to a 2019 report by the FDA, Dollar General had a violation rate of 7.5% for selling tobacco products to minors, which is lower than the national average of 9.6% but still a concern for public health advocates.
The Decision to Sell Tobacco Products
Dollar General began selling tobacco products in 2013, following in the footsteps of its main competitor, Family Dollar. The decision was driven by several factors, including:
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Customer demand: Many Dollar General shoppers expressed a desire for the convenience of purchasing tobacco products alongside their regular household items. A 2015 survey by the National Association of Convenience Stores found that 68% of customers who purchase cigarettes do so at convenience stores or gas stations, suggesting a significant opportunity for dollar stores to capture this market.
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Competitive pressure: Family Dollar‘s success in selling tobacco products prompted Dollar General to enter the market to avoid losing customers to its rival. In 2012, Family Dollar reported that tobacco sales accounted for 5% of its total sales, or approximately $500 million, demonstrating the potential revenue stream for dollar stores.
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Revenue potential: Tobacco products are known for their high profit margins, making them an attractive addition to Dollar General‘s product lineup. According to a 2019 report by the Campaign for Tobacco-Free Kids, the average markup on a pack of cigarettes is 18%, compared to just 2-3% for most other consumer goods.
Despite the financial benefits, the decision to sell tobacco products has not been without controversy. Critics argue that dollar stores, which often serve lower-income communities, are contributing to the disproportionate burden of tobacco addiction and related health problems among vulnerable populations.
Comparison to Family Dollar‘s Tobacco Offerings
Family Dollar, another major player in the dollar store industry, was the first to introduce tobacco products to its stores. Like Dollar General, Family Dollar sells cigarettes, cigars, e-cigarettes, and other tobacco-related items. The two retailers offer similar brands and prices, making them direct competitors in the tobacco market.
The introduction of tobacco products at dollar stores has had a significant impact on the industry. Traditional tobacco retailers, such as convenience stores and gas stations, have faced increased competition and have had to adjust their prices and promotions to remain competitive. A 2018 study by the Journal of Community Health found that the presence of a dollar store selling tobacco products within a half-mile radius of a tobacco retailer was associated with a 14% reduction in cigarette prices.
Smoking Cessation Products at Dollar General
In addition to selling tobacco products, Dollar General also offers a selection of smoking cessation aids, such as nicotine gum and patches. These products are typically located in the health and personal care section of the store, separate from the tobacco products sold at the checkout counter.
The availability of smoking cessation products alongside tobacco items has raised questions about Dollar General‘s commitment to its customers‘ health and well-being. Some argue that offering both types of products sends a mixed message and undermines efforts to help people quit smoking. However, others point out that providing access to smoking cessation aids can be beneficial for those who are trying to quit, particularly in underserved communities where access to healthcare may be limited.
Impact on Brand Image and Corporate Social Responsibility
The sale of tobacco products at Dollar General has the potential to impact the company‘s brand image and reputation. As public awareness of the health risks associated with smoking grows, some consumers may view Dollar General‘s decision to sell tobacco as inconsistent with its position as a family-friendly, community-oriented retailer.
Moreover, the disproportionate impact of tobacco addiction on lower-income communities has led to concerns about Dollar General‘s corporate social responsibility. Critics argue that the company has a duty to prioritize the health and well-being of its customers, particularly those who may be more vulnerable to the negative consequences of tobacco use.
In response to these concerns, Dollar General has emphasized its commitment to responsible retailing and compliance with all applicable laws and regulations related to tobacco sales. The company has also highlighted its efforts to promote healthy living through its "Better For You" initiative, which offers a selection of healthier food options and personal care products.
The Future of Tobacco Sales at Dollar Stores
As consumer preferences, regulations, and public health concerns evolve, the future of tobacco product sales at dollar stores remains uncertain. Some potential factors that could influence the industry include:
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Changing attitudes towards smoking: As more people become aware of the health risks associated with tobacco use, demand for these products may decline. According to the CDC, the percentage of adults who smoke cigarettes has dropped from 20.9% in 2005 to 13.7% in 2018, reflecting a significant shift in public opinion.
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Stricter regulations: Governments may impose additional restrictions on the sale and marketing of tobacco products, making it more challenging for dollar stores to continue selling them. For example, in 2019, the FDA proposed a ban on menthol cigarettes and flavored cigars, which could have a significant impact on dollar store tobacco sales.
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Pressure from public health advocates: Anti-smoking campaigns and lobbying efforts could put pressure on dollar stores to reconsider their decision to sell tobacco products. Organizations such as the Campaign for Tobacco-Free Kids and the American Lung Association have actively advocated for policies that restrict tobacco sales and promote public health.
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Shifts in corporate social responsibility: As consumers increasingly prioritize social and environmental concerns, dollar stores may face pressure to align their product offerings with these values. Companies that are seen as contributing to public health problems or social inequities may face backlash from customers and investors.
Despite these challenges, it is likely that Dollar General and other dollar stores will continue to sell tobacco products in the near future, given the significant revenue they generate. However, the long-term sustainability of this practice remains to be seen.
Conclusion
Dollar General‘s decision to sell tobacco products has been a controversial one, with supporters pointing to customer demand and revenue potential, while critics raise concerns about public health and corporate social responsibility. As the dollar store industry continues to evolve, it will be important for retailers like Dollar General to carefully consider the impact of their product offerings on their customers, communities, and brand image.
By providing a wide range of tobacco products, as well as smoking cessation aids, Dollar General aims to meet the diverse needs of its customers. However, the company must also navigate the complex ethical and social implications of selling products that are known to have significant negative health consequences, particularly for vulnerable populations.
As consumers, policymakers, and public health advocates continue to grapple with the issue of tobacco sales at dollar stores, it is clear that the debate is far from over. The future of tobacco products at retailers like Dollar General will likely depend on a complex interplay of market forces, regulatory pressures, and evolving social norms.
Ultimately, the decision to sell tobacco products at dollar stores raises important questions about the role of retailers in shaping public health outcomes and the responsibilities of companies to their customers and communities. As the landscape of tobacco sales continues to evolve, it will be crucial for Dollar General and other retailers to engage in ongoing dialogue with stakeholders and to prioritize the well-being of their customers above short-term profits.
