Dive Brief:

• Dollar General Corporation last week announced that Jason Reiser will join as executive vice president and chief merchandising officer, effective July 12. Reiser replaces Jim Thorpe, who retired on April 15, according to a company press release. 

• Reiser brings more than 30 years of experience in retail management, private brand sourcing and regulatory affairs. He most recently served as executive vice president and chief operating officer at the Vitamin Shoppe, where he oversaw merchandising, operations and supply chain. His background also includes a stint as chief merchandising officer at Family Dollar. Reiser started his retail career as a pharmacy manager for Walmart and eventually served as a vice president for Walmart’s Sam’s Club unit.

• Dollar General earlier this month said that first quarter net sales rose 6.5% to $5.61 billion, up from $5.27 billion in the prior-year period, buoyed by sales from new stores that were partially offset by sales from closed stores. Same-store sales in the quarter rose 0.7%, with an increase in average transactions partially offset by a decline in traffic. 

Dive Insight:

Like many dollar discount stores, Dollar General is doing relatively well in a tough retail environment, given its position as a discount player with especially thin margins and stiff competition, says GlobalData Retail Managing Director Neil Saunders.

But Saunders, in an email to Retail Dive about the company's first quarter, also noted softness in its numbers. “[I]t is clear that Dollar General in particular, and dollar stores in general, are suffering from a slight loss of momentum,” he said in a note emailed to Retail Dive. “This does not mean the format is falling out of favor or that there isn't scope for future expansion, but it does mean that growth is now harder to attain.”

Dollar store sales are also being slowed by increasing sharing of customers. That share is going mostly to Wal-Mart, which has made concerted efforts to improve stores and services in recent months, according to GlobalData Retail’s research. Impending competition from the arrival of Lidl and the expansion of Aldi — two German no-frills grocery chains that have sparked price wars in Europe — are likely to exacerbate market share fights among discounters.

That makes Dollar General’s expansion plans especially important, in order to combat the company’s muted same-store sales. It also makes its merchandising important. Low-cost retailer Five Below has been especially adept at offering key merchandise that brings shoppers into stores. 

“Whereas dollar stores are focused on essentials with an add-on of impulse and treat products, Five Below is focused on treats and impulse buys with an add-on of essentials,” GlobalData Retail analyst Carter Harrison said in a note emailed to Retail Dive. “To a degree, this insulates it from more functional retailers like Wal-Mart even as they sharpen prices. It also helps in driving regular traffic to stores and online.”

In his statement last week, CEO Todd Vasos suggested that Reiser is up to the challenge. “Jason is an innovative merchant who has a broad range of experience in discount retail and a track record of leadership excellence,” he said. “I believe Jason’s deep understanding of our customer and small-box retail, coupled with his proven ability to drive results, will strengthen our leadership team as we strive to capture future growth opportunities.”