Dollar General and Walmart

Dollar General and Walmart

Policy

Author

Institution

Dollar General has built its cost advantage through ensuring that its stores are close and well distributed all over the region. This makes distribution of commodities to the stores easier and cost-effective since distribution cost is mitigated (Shih et al, 2009). This makes the Dollar General to build a cost advantage in providing services to the people. Besides, through the use of technology, dollar general has built its cost advantage through ensuring effective and efficient service delivery. In addition, Dollar General has built its cost advantage through effective store management (Shih et al, 2009).

Dollar General and Wal-Mart offer almost the same commodities. This implies that Dollar General has an opportunity of competing directly with Wal-Mart. In case the stores were dealing with totally different commodities, Dollar General could have competing strategies that focus on competing indirectly with the Wal-Mart stores. Offering of household commodities, health and beauty commodities by the two stores (Shih et al, 2009) opens an avenue for direct competition. Therefore, dollar General should compete directly with the Wal-Mart stores. In fact, direct competition should be highly encouraged since it can offer an opportunity for improving the commodities and services that the two stores offer.

One of the recommendations to the Dollar General concerning its strategic alternatives involves increasing efficiency in store management. Dollar General should continue managing its stores efficiently through the involvement of technology; this will help in reducing operating costs which will be a competitive advantage to Dollar General. Besides, dollar General should concentrate on charging a low price for its commodities; this will also give the chain store a competitive advantage over other stores offering similar commodities. In addition, Dollar General should also consider adding its stalls. This will help the chain store in increasing its sales volume.

References

Shih, W., Kaufman, S. & Mckillican, R. (2009, April 28th). Dollar General (A). Harvard Business School.