Would You Buy Fresh Fruits and Veggies at Dollar General? They Hope So

The dollar store giant is poised to revolutionize the grocery game.
Updated July 18, 2024
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In a groundbreaking move, Dollar General, the nationally loved discount chain, is transforming by incorporating fresh produce options in over 5,000 stores nationwide. 

This strategic shift not only sets a record for the retailer, boasting more individual points of produce distribution than any other mass retailer or grocer in the U.S., but it also underscores Dollar General's commitment to meeting the evolving needs of its customer base. The key driver behind this fresh initiative lies in the integration of artificial intelligence (AI) solutions, particularly those provided by Shelf Engine.

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What Dollar General is doing and where

Dollar General's foray into fresh produce marks a significant departure from its traditional inventory, which usually includes items like greeting cards, candy, and cleaning supplies. The company is now offering a diverse range of fresh produce, including tomatoes, onions, apples, strawberries, potatoes, lemons, salad mixes, and more.

This expansion aligns with Dollar General's "Food First" initiative, unveiled in July 2023, emphasizing fresh and affordable food options for the communities it serves. The retailer now carries the top 20 items typically found in grocery stores, making it a formidable player in the competitive grocery landscape.

Moreover, Dollar General has surpassed the 5,000 store milestone, claiming it is the only store in the country to provide fresh produce in 5,000 locations.

The role AI is playing

The driving force behind Dollar General's successful integration of fresh produce lies in the strategic use of artificial intelligence. The retailer has partnered with Shelf Engine, an AI company specializing in demand forecasting and inventory insights.

Shelf Engine's AI solutions are set to optimize the fresh produce buying process, enhancing Dollar General's operational efficiency while ensuring improved in-stock levels of perishable items. By leveraging Shelf Engine's capabilities, Dollar General is positioning itself at the forefront of the grocery industry's technological evolution, joining the ranks of other retailers embracing AI to boost margins and streamline operations.

Addressing "food desert" concerns

Dollar General's expansion into fresh produce is not without its challenges, particularly in the face of criticism regarding the retailer's contribution to "food deserts." These are areas where access to nutritious food options is limited, and Dollar General, along with its dollar store counterparts, has faced backlash for perpetuating this issue.

Critics say the chain’s rapid expansion comes with certain social and economic costs to the communities the stores are built in. Many say the smaller prices Dollar General offers are actually due to the smaller sizes of the items, effectively making the product more expensive than traditional vendors.

Others say the growth drives out independent, smaller grocers and in the process only makes the food desert problem worse, as shoppers then have more limited access to healthier foods.

However, the retailer's strategic move into fresh produce, coupled with AI-driven inventory management, presents an opportunity to combat these concerns. Dollar General says its commitment to offering diverse and affordable fresh options can potentially bridge the gap and provide communities with improved access to nutritious foods.

What customers can expect

As Dollar General takes a giant leap into the realm of fresh produce, powered by AI-driven solutions, the implications are far-reaching. The retailer's bold move not only sets a new standard for its industry but also showcases the pivotal role technology plays in reshaping traditional retail models.

For consumers, this development represents a boon, offering more choices and access to fresh produce in areas that might have previously lacked such options. While concerns about Dollar General's impact on "food deserts" persist, the retailer's proactive steps to address these issues through expanded offerings demonstrate a commitment to positive change.

This could also mean a shift in the grocery industry overall. Larger grocery chains like Kroger, ShopRite, etc. may now adjust their operating models to compete with the dollar giant, potentially affecting prices for the end user.

Bottom line

Dollar General's expansion into fresh produce and its strategic use of AI exemplify a forward-thinking approach to meet the evolving demands of consumers. As technology continues to reshape the retail landscape, this retailer stands at the forefront, paving the way for others to follow suit. The integration of AI not only improves operational efficiency but also may address broader community concerns, making this initiative a win-win for Dollar General and the communities it serves.

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Author Details

Georgina Tzanetos Georgina Tzanetos is a former financial advisor who has been active in financial media for the past six years. She holds a master's in political economy from NYU, where she studied distressed labor markets.