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The Associated Press reports that Dollar General has become one of the fastest-growing US retailers, "opening more than half its 6,653 stores in the past five years," by focusing on smaller (7,000-8,500 square foot), more convenient stores in rural areas or in poor neighborhoods of midsize cities, and by selling only the most productive merchandise mix.

"We have one thing in common with Wal-Mart," David Perdue, Dollar General's CEO, told the AP. "Both companies took a down-home approach to satisfying an underserved customer."

However, this is changing a bit. Dollar General currently is testing a General Market format that is about twice the size of its traditional stores and that sell more food. Results to date at two test units have been positive enough to encourage the company to open another 20 such markets next year.
KC's View:
Differentiation can come in all different sizes and from all different directions. (See the next story for further proof…)