Owning your own business is always a tricky and stressful situation because of all the work you need to do and the risks.
Franchising eliminates most of the risks and the associated anxiety of owning a business by giving you an already-established brand.
Many brands around the world franchise to those who want it and give the right to use their name.
Dollar General is one of the very popular brands, and if you are thinking of owning a franchise, you probably thought about whether you should own a Dollar General. It is one of the 50 best franchises that you must own.
If you would like to see whether Dollar General franchises and the other details, you are in the right place. This article will talk about the franchise details of Dollar General.
About Dollar General
Dollar General is an American chain of stores with headquarters in Tennessee, United States.
They are one of the biggest variety store chains in the United States, with over 18,000 stores across many different states.
The company is completely company-owned, and it started as a family business. They went public on the New York Stock Exchange in 1986, and they are still on the Exchange.
On top of its fame and number of stores, they are also one of the most profitable stores in the United States, with $27 billion in revenue in 2019.
This amazing brand awareness helps them to grow at an exponential rate. They were recognized as Fortune 500 company in 1999, and it reached number 112 in 2020.
History Of Dollar General
Founded by James Luther Turner and his son Carl Turner in 1939, the company has been in operation ever since.
When the company was first founded, its name was J.L. Turner and Son, but it later got the Dollar General name in 1955.
They only started with $5,000 but quickly reached $2 billion in annual sales by the early 1950s.
Over the next decades, the company changed the way of its operations and the items it sold several times. Each time, they kept growing quickly and kept most of the changes.
They expanded to Asia in 2004 by opening an office in Hong Kong, and now they have over 18,000 outlets and 158,000 employees.
Dollar General Franchise Model
| Cost or Fee | Amount |
|---|---|
| Initial Investment | $100,000-$600,000 |
| Franchise-Fee | $20,000-$50,000 |
| Liquidity Capital | $20,000 or more |
| Royalty | N/A |
| Area Requirement | N/A |
| Total Outlets | 17,000 stores |
Is Dollar General A Franchise?
Dollar General is not a franchise, as all of its stores are company-owned and operated.
This means that the company does not offer franchise opportunities for individuals to own and operate their own Dollar General stores.
Instead, all profits from Dollar General stores go directly to the company, rather than to outside operators.
How Much Does It Cost To Open A Dollar General Franchise?
Dollar General is not a franchise, and therefore, there are no associated costs of opening a Dollar General franchise.
According to estimates, the cost of opening a Dollar General similar franchise can range from $1,000,000 to $2,000,000 or more.
This estimate includes expenses such as initial franchise fees, real estate costs, inventory, equipment, and other operational expenses.
However, the actual cost can vary depending on a variety of factors, such as location, size of the store, and other operational expenses.
Why Doesn’t Dollar General Offer Franchising?
There is no public information available as to why Dollar General doesn’t offer to franchise.
We know that the company is 100% privately-owned, and they most likely don’t want to give that up.
Because each franchise means the franchise owners get equity in the company, and Dollar General is not open to this.
Dollar General Average Revenue & Profit
| Year | Revenue (in billions USD) | Profit (in billions USD) |
|---|---|---|
| 2021 | $33.7 | $2.655 |
| 2022 | $34.2 | $2.399 |
| 2023 | $37.8 | $2.416 |
With over 18,000 stores across a vast area, it is no surprise that Dollar General generates a high amount of revenue and profit.
In the year 2023, they generated a revenue of $37.8B, with an increase of 10.5% from the previous year.
They had an increasing trend in the past five years without any decrease in the overall revenue.
Of that $37.8B revenue in 2023, only a certain amount is the actual profit because the revenue is just the amount for the sold goods.
The same year, they made a profit of $2.4B, about a 0.7% increase from the previous year.
What is the Average Dollar General Revenue Per Store?
Dollar General’s average revenue per store in 2023 amounted to approximately $2.1 million, derived from a total revenue of $37.8 billion generated by their extensive network of over 18,000 stores. This marked a 10.5% increase from the previous year and reflects Dollar General’s consistent upward revenue trajectory over the past five years.
What Are Some Alternatives to Dollar General Franchise?
Just-A-Buck
Just-A-Buck, similar to Dollar General, is a dollar chain store that has both franchise and company-owned locations.
They sell games and toys for children, goods, hardware, personal care products, collectibles, and many other things. All the items in their stores are priced at $1.
If you would like to own a Just-A-Buck franchise, you are going to need to make an initial investment of somewhere between $136,000 and $228,000.
On top of that, you also need to pay a franchise fee of $25,000, have a liquid capital of $40,000, and have a $150,000 net worth. They currently have 24 stores.
Just-A-Buck was founded in 1988 and started to franchise in 1992. They are one of the very few dollar stores that are still standing. They are headquartered in New York.
Dollar Castle
With 20 locations across different states, Dollar Castle is quickly growing to be one of the most popular dollar store chains in the United States.
They sell name-brand products, food, party, and cleaning supplies, and many more at the lowest possible prices. Dollar Castle stores could go up to 20,000 square feet in size.
The franchise fee to buy the brand name for Dollar Castle is $30,000, which is a single, lump sum payment.
To be eligible to be approved for a franchise, you need a liquid capital of $210,000. The total investment to get the store running is between $229,000-$541,000.
Dollar General Comparison
| Company | Franchise Fee | Royalty Fee | Initial Investment |
|---|---|---|---|
| Dollar Store Services | N/A | N/A | $76,900-$366,900 |
| Dollar Discount Store of America | $18,000 | 3% | $120,000-$130,000 |
| Dollar General | N/A | N/A | N/A |
Conclusion
Dollar General is one of the biggest dollar store chains in the United States.
They boast over 18,000 stores and have billions of dollars of revenue every year that keeps increasing.
However, they do not franchise their business as all of their stores are company-owned.
The reason for this decision is not public, but there are many other dollar store chains that you can franchise from.
It all depends on what you want, how you would like to move forward, and how much you can invest.
Dollar stores can generally be a lucrative franchise option if you can manage them well. Before investing, you must also know who owns Dollar General. This will help you make an informed decision.
FAQ
What is the reason Dollar General doesn’t franchise?
The company doesn’t publicly explain why they do not franchise. That’s why we don’t know the exact reason behind this decision.
Who is the CEO of Dollar General?
Jeff Owen is the current CEO of the company. He has been holding this spot for less than a year, since November 2022.
Will Dollar General franchise in the future?
It is unclear whether Dollar General will go the franchising route in the future. For now, there are no public plans for this.
Amit Gupta is an experienced expert in digital marketing and co-founder of DrFranchises. With more than 11 years of knowledge in franchise digital marketing, SEO, email marketing, and social media marketing, Amit has helped many brands achieve incredible success online. As a passionate entrepreneur and owner of 7 franchises, he continues to study franchise models, looking at costs, revenue, and profitability to guide brands toward profitable growth. When he’s not working on digital marketing, Amit enjoys spending time playing with his beloved dog.