Dollar General, one of the largest discount retailers in the US, has announced that it has brought back its former CEO Todd Vasos to lead the company out of its current troubles. Vasos, who retired in 2022 after seven years at the helm, will replace Jeff Owen, who was in charge for less than a year.
Dollar General faces slowing growth and rising costs
Dollar General has been struggling with slowing sales growth and shrinking profit margins in recent months. The company blamed weaker consumer spending, higher costs of living, and increased theft for its disappointing performance. In August, the company cut its sales and profit outlook for the year, signaling that the challenges were not going away soon.
The company’s customer base, which consists mainly of low-income shoppers, has been hit hard by the end of pandemic relief benefits and the rising inflation. As a result, many customers have reduced their purchases of non-essential and discretionary items from the chain. According to Neil Saunders, retail analyst and managing director at GlobalData, this has hurt Dollar General’s profitability and market share.
Dollar General workers protest over safety issues
Another issue that has plagued Dollar General is the safety of its workers and customers. Earlier this year, workers staged protests across the country over a pattern of federal safety violations and violent incidents at the chain’s stores. The workers demanded better security measures, higher wages, and more respect from the management.
The protests were organized by United for Respect, a labor advocacy group that represents retail workers. The group claimed that Dollar General had failed to protect its employees from robberies, assaults, and even murders. The group also accused the company of violating labor laws and discriminating against workers based on race, gender, and disability.
Todd Vasos hopes to restore confidence and growth
In a bid to turn things around, Dollar General’s board of directors decided to reinstate Todd Vasos as CEO, effective immediately. Vasos had previously led the company from 2015 to 2022, during which time he oversaw a significant expansion of its store network, sales volume, and market capitalization.
Vasos said in a statement that he was looking forward to working with the team to return the company to a position of operational excellence and long-term growth. He also thanked Owen for his service and wished him well for the future.
The announcement was welcomed by Wall Street analysts and investors, who saw Vasos as a proven leader who could restore stability and confidence in the company. Shares of Dollar General surged in after-hours trading on Thursday following the news.