by Tyler Durden
Dec 1, 2016 3:56 PM
Dollar General's Startling Admission: Half Of U.S. Consumers Are Feeling More "Dire" Than EverMaking matters worse, he added that
the company's core consumers base, 65% of which is comprised of lower-income shoppers, has been impacted by the recent reduction or elimination in foodstamps: "now couple that in upwards of 20 states where they have reduced or eliminated the SNAP benefit, and it has really put a toll on [the core consumer]."
He elaborated that
the reduction in foodstamps benefits promptly filtered through the entire business model, and culminated with Dollar General being forced to cut prices to remain competitive.
And just to avoid putting words in his mouth, this is what Todd Vasos said during today's Q&A, when a Morgan Stanley analyst asked him if he can share "any further color around the low-end consumer health" and how it differs from what the company noted last quarter versus the latest observations. This is what Vasos replied:
Interestingly, we talk to our consumers each and every quarter through panel data as well as we bring them in and talk to them in general and I can tell you as late as mid third quarter, they were telling us that
their sentiment - feeling - is even more dire than it was in previous quarters in early 2016. What they're citing and continue to cite is the rising healthcare costs that they're facing. I don't believe any of our core customers realized what they were up against on those rising costs. And then rental costs continue and they call that out second on paying rent because most of our, again, core customers rent, don't own and those rents are going up across the nation at a pretty high rate.
http://www.zerohedge.com/news/2016-12-01/dollar-generals-startling-admission-half-us-consumers-are-feeling-more-dire-ever
