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Business Insider reports that Dollar General yesterday posted Q1 same-store sales that were up 21.7 percent and net sales that were up 27.6 percent - growth that seems to be a reflection of two things.

First, there is the fact that a declining economy makes Dollar General's value proposition particularly appealing.

And second, there is Dollar General's geographic ubiquity - Business Insider notes that "according to GlobalData Retail, 75% of the US population is now within five minutes of a Dollar General store."


Reuters reports this morning that Nordstrom has posted Q1 sales that were down 40 percent, to to $2.03 billion from $3.35 billion a year earlier. The iconic department store chain also said that it had a net loss of $521 million, compared with a profit of $37 million a year ago.

There was a scintilla of good news - online sales rose 5% to $1.1 billion.

CEO Erik Nordstrom released a statement saying that the company "strengthened our financial flexibility by increasing liquidity, lowering inventory by more than 25 percent from last year and significantly reducing our cash burn by more than 40 percent from March into April.  We're entering the second quarter in a position of strength."

Reuters writes that "Nordstrom said roughly 40% of its stores have reopened, though they are in smaller markets. It plans to reopen its entire fleet of shops by the end of June, including in major markets California and New York."

KC's View:

I don't think there is any question that Dollar General - along with other value-driven formats like WinCo, Grocery Outlet, Aldi and even Lidl (smaller than the rest, but expanding) - are ideally positioned to take advantage of a troubled economy in which unemployment will continue to be high as the nation slides from pandemic to recession.  It is a good time to have a price-centric format in your arsenal.

As for Nordstrom … I suspect that they're going to be fine, though it certainly will take some time to get there.  My confidence is largely based that Nordstrom has for some time been investing in technologies that are designed to transform the shopping experience, as well as testing the Nordstrom Local concept that I think gives it the ability to offer a unique hybrid experience to its shoppers and fans.