From CNN Business:
Dollar General is turning to a new strategy to push its budget-conscious shoppers to spend more at stores and attract wealthier customers hunting for bargains by expanding into home furnishings, kitchenware and party supplies.
Dollar General has become a dominant force in retail by offering everyday items at rock-bottom prices, often in remote areas of the country. More than three-quarters of Dollar General's $25 billion in annual sales come from its "consumables" division: low-margin food, cleaning and household supplies and personal care products.
But Dollar General's reliance on selling cheap consumables has pinched its profit. So the company is introducing a new lineup of higher-margin merchandise.
Over the past year, Dollar General has added an assortment of pillows, candles, home decorations, gift bags and wrapping paper to more than 1,000 stores. Most of the stuff costs $5 or less.