Dollar and General Merchandise Stores NAICS 455219

Sep 19, 2025 - Dollar General Posts Strong Q2 Growth Amid Tariff Pressures

• According to a report in Retail Dive, Dollar General reported a strong Q2 performance with net sales rising 5.1% year-over-year to $10.7 billion and same-store sales up 2.8%. Gross profit margin improved to 31.3%, aided by reduced shrink and strategic inventory markups. The retailer raised its full-year guidance, citing broad consumer growth across income levels. Despite tariff-related price pressures, Dollar General’s low direct import exposure and proactive sourcing helped mitigate impact. The company continues to prioritize value, maintaining over 2,000 SKUs priced at or below $1 and staying within 3-4% of mass retailer pricing. Operational enhancements include reduced self-checkouts and SKU rationalization. Dollar General’s growth underscores the resilience and adaptability of dollar store models amid inflationary and tariff challenges.
• Consumer mood indicators in the US declined, signaling growing economic unease. The Consumer Confidence Index fell 1.3 points in August 2025, driven primarily by younger consumers under 35, while confidence among those over 55 improved. Despite the dip, overall confidence remained consistent with recent months. Separately, the University of Michigan’s Consumer Sentiment Index dropped to 55.4 in preliminary September data, down from 58.2 in August and 21% below September 2024 levels. Inflation expectations held steady, though concerns about pricing pressures, particularly from tariffs, persist. These indices reflect consumers’ outlook on personal finances and the broader economy, serving as key predictors of future spending behavior.

• Dollar and off-price stores may be a growing part of back-to-school sales, according to a new Coresight Research survey on US back-to-school spending in Yahoo Finance. The survey estimates that US back-to-school spending will grow 3.3% year over year, reaching $33.3 billion, with consumers anticipating spending more amid inflationary impacts. Focused on value amid broader economic pressures, consumers are seeking budget-friendly shopping options such as dollar stores, off-price stores, mass merchandisers, and secondhand apparel. According to the survey, “Most shoppers expect to exceed last year’s spending, but inflation, tariffs, and supply chain uncertainty continue to weigh on purchase decisions. These concerns are driving behavioral shifts, with many consumers planning to start shopping earlier, explore secondhand options, or adjust where and how they shop in response to higher prices and potential product shortages.” Back-to-school shopping is inching earlier, with 62% of respondents planning to shop before August compared to 53.9% in 2024, potentially motivated by concerns of potential tariffs.
• Sales for the US dollar and general merchandise stores industry are projected to grow at a 4.2% CAGR from 2025 to 2029, comparable to the overall economy's projected growth, according to a forecast from Inforum and the Interindustry Economic Research Fund, Inc. The retail and wholesale sectors are driven by consumer spending, along with expenditure by businesses and the government. Consumer sentiment is expected to improve in the forecast period, which bodes well for the sector. The forecast said retail spending could soften with the growth of spending on consumer services. A factor that may limit consumer spending is higher tariffs on consumer goods. Lower inflation supports a moderate increase of real disposable income by about 2% in 2025 and 1.9% in 2026. Real income could suffer if prices rise due to tariff implementation.