Dollar General to sell tobacco in most of its stores by mid-2013, reflecting 'customer demand' and 'competition pressure'

By the middle of 2013, most of Dollar General's 10,000 U.S. stores will carry cigarettes and other tobacco products.. The company has made the decision in response to “competitive pressures” which came about when Family Dollar Stores, a key competitor, began adding cigarettes to its stores last year. In a press release issued by Dollar General, customer demand also drove the company's decision, citing their perception that their core customers -- mostly based in rural America -- are more likely to smoke than the national average.

A 2012 study by the American Lung Association indicated that while rural Americans do smoke more than urban Americans, geography is less a factor in determining who smokes than socioeconomic status. The study also found that pregnant rural women are far more likely to smoke than their urban counterparts. (See actual numbers from the Centers for Disease Control and the American Lung Association study here.)

G. Chambers Williams III of The Tennessean in Nashville reports that business analysts think the idea is a good one for the company, which tested the product placement last year in Nevada. Analyst Mark Montagna with Avondale Partners in Nashville explained that the company found that the average purchase per customer was $14 where tobacco was sold, versus an average of $11 otherwise. But, he added, the one challenge the company will face with tobacco products, additional shoplifting.
Anti-smoking advocates expressed regret at the business choice. (Read more)