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Dollar General bullish on year with tobacco rollout

BY Michael Johnsen

GOODLETTSVILLE, Tenn. — Dollar General increased net sales by 8.5% to $4.2 billion for its first quarter ended May 3, the dollar operator reported Tuesday. 

“For the quarter, we achieved same-store sales growth of 2.6%, reflecting strong growth in our consumables categories offset by softer sales in seasonal and weather-sensitive categories,” stated Rick Dreiling, Dollar General’s chairman and CEO. “We believe the continued strength in consumables is a sign of the underlying health of our business.”

Dollar General is in the process of introducing tobacco across its store base, a factor expected to drive traffic and basket value. "At the store level the most significant initiative implemented has been our aggressive rollout of tobacco products. We are on track to have tobacco rolled out to essentially all of our stores before the end of the second quarter," Dreiling told analysts. "As of today we have tobacco in approximately 10,000 of our stores, which is quite an achievement when considering the amount of work involved." In addition to refixturing the front end, each location has to secure a license to sell tobacco and train employees on sales restrictions. "In addition, we have reconfigured the front end of the store to facilitate the sale of tobacco, including the addition of more impulse items," Dreiling said. As of now, two-thirds of Dollar General’s tobacco customers have an additional item in the marketbasket. "The average basket with tobacco and additional items is currently above $17," Dreiling noted. "We expect the percentage of baskets with tobacco will continue to ramp up over the next several months." 

Dollar General updated its outlook to reflect moderating sales growth and a lower expected gross profit rate than the company had previously anticipated. “We are well-positioned for our same-store sales growth to accelerate ton 4% to 5% for the year as our key initiatives — such as the rollout of tobacco and Phase 5 planogram changes — continue to gain traction through the year," Dreiling added. 

The Phase 5 program is an initiative to optimize shelf space across 3,000 legacy stores that had not been remodeled to Dollar General’s "customer centric" format. Dollar General successfully completed the fixturing and reorganization of 2,800 stores within that group for the quarter. Those stores have realized a comparable sales lift of 100 basis points on average, Dreiling said. 

"Additionally, across the rest of the store base, the implementation of new planograms increased more than 30% year-over-year as we advanced the timing of our planogram changes into the first quarter of this year to better align with our category-management plans and new product introductions," Dreiling said. "Specifically, we made more than 600,000 planogram changes across our store base in the first quarter." During the 2013 first quarter, the company opened 165 new stores, including 10 Dollar General Markets and eight Dollar General Plus format. The dollar store operator remodeled or relocated 207 stores, including 44 Dollar General Plus. At the end of the first quarter, Dollar General’s footprint extended across 40 states with 10,662 stores. "Well on our way of our next milestone of 11,000 stores," Dreiling said. 

"Sales of nonconsumables are expected to remain challenging, and we anticipate a continued shift to lower margin items within consumables and higher inventory shrink," Dreiling continued. "We believe that our customers’ dependence on our everyday low pricing and convenient locations has never been greater.” For the 2013 fiscal year, Dollar General expects total sales to increase 10% to 11% over the 2012 fiscal year. 

Total sales increases in consumables significantly outpaced increases in the company’s nonconsumable categories, reflecting the impact of continued financial pressures on consumers, as well as unfavorable weather conditions in many of the Dollar General’s geographic regions, the company noted.

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P&G’s Always brand launches ‘Give a Girl a Break’ initiative

BY Antoinette Alexander

CINCINNATI — Procter & Gamble’s Always feminine care brand has announced the launch of its “Give a Girl a Break” initiative that aims to turn filmmaking passions into careers for a group of aspiring young women.

“Women help and inspire each other every day, but unfortunately that is not always how women are portrayed. Even a little encouragement from another woman can spark amazing accomplishments and we want to celebrate women supporting other women,” stated Sarah Innes, P&G North America FemCare marketing director. “We are proud to launch ‘Give a Girl a Break’ as an inspiring example of what can be achieved by a community of women who encourage each other to pursue their passions. We hope many will join Always in this effort and help demonstrate how women are stronger together.”

The “Give a Girl a Break” will engage the Always Facebook community to commit to helping other women and support the filmmakers’ journey.

How it works: “Give a Girl a Break” features three teams of female filmmakers as they create short films showing how support from other women can make a difference. During the production, the Always community has a chance to engage with the teams and their stories through:

  • Exclusive behind-the-scenes videos;
  • Facebook updates from the sets;
  • Twitter chats with the filmmakers and María Marín;
  • Photos and updates documenting the journey.

Upon completion, all three films will debut on the Always Facebook page where fans can vote in different categories to show the filmmakers their support.


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Nielsen identifies top 14 CPG products over past two years

BY Michael Johnsen

PHOENIX — Nielsen on Tuesday awarded its 14 Breakthrough Innovation Winners for 2013 at the company’s Consumer 360 event here. 

“What’s fascinating about this year’s Breakthrough Innovation Award winners is their diversity,” stated Rob Wengel, SVP innovation, Nielsen. ”No matter the industry or category, Breakthrough Innovation is possible where there is a vision for innovation, pervasive leadership to drive support, and alignment throughout the organization to make it happen.“

The winners are:

  • Allegra Allergy;
  • Colgate Optic White;
  • Dannon Oikos Greek Yogurt;
  • Downy Unstopables In Wash Scent Booster;
  • Fiber One 90 Calorie Brownies;Magnum Ice Cream;
  • Milo’s Kitchen Home-Style Dog Treats;
  • MiO Liquid Water Enhancer;
  • Monster Rehab;
  • Velveeta Cheesy Skillets;
  • Reese’s Minis;
  • Skinny Cow Candy;
  • Sparkling ICE; and
  • Special K Cracker Chips.

This is the second year that Nielsen has presented the award. Nielsen conducted an extended analysis of 3,439 new consumer product introductions in the U.S. during 2011 to determine which products demonstrated breakthrough results. To earn the title of Breakthrough Innovation Winner, a product needed to deliver a new value proposition to the market, generate year-one U.S. sales of $50 million or greater in Nielsen-measured channels (including food, drug, convenience, dollar club and mass) and achieve at least 90% of year-one sales in year two. This measure confirms a sustained level of consumer demand while allowing for some revenue consolidation during the transition from trial to repeat, the company stated. 

“Breakthrough Innovation companies achieve uncommon results because of their ability to pursue, shape, develop and activate insights that deliver what consumers demand,” noted Taddy Hall, SVP Nielsen. “These winners challenged convention and triumphed by expanding or transforming categories. It is through their unencumbered, demand-driven development that Breakthrough Winners create visible separation from the pack.”


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