Suds for a buck? Dollar Stores seek beer license

You might have popped into one of the growing number of Dollar General stores around the country for paper towels, detergent, soft drinks or a box of cereal.
 
But beer?
 
It might be possible here in the near future.
 
As part of an emerging trend, Dollar General is seeking licenses to sell beer at five of its stores in Henderson County, Ky.
 
Dollar General has tested beer and wines stores in about a dozen states since 2008, Supermarket News, a trade publication, reported last year.
 
The discount chain last year ramped up its efforts, obtaining beer permits for 50 stores in Arkansas while also seeking licenses in markets such as Indianapolis and St. Louis, according to news reports.
 
The idea of Dollar General selling beer seems to surprise some consumers.
 
But beer is sold at pharmacies, grocery stores, Walmart and Kmarts -- and convenience stores, which sold more than $16.7 billion worth of beer last year, making them the largest seller of beer outside of restaurants and bars, according to the Beer Institute.
 
And Dollar General considers itself a store of convenience.
 
"We ... provide customers with a highly convenient shopping experience," with relatively small stores, parking available near the front door and hours that extend to 9 or 10 p.m. seven days a week, the company said in an annual report filed earlier this year with the federal Securities and Exchange Commission.
 
Strictly speaking, "Dollar General is not a convenience store," Jeff Lenard, spokesman for the National Association of Convenience Stores, said. (While a dollar store shares some similarities, C-stores are usually smaller, serve hot snacks and sell gasoline, he noted.)
 
"But they are very much a 'convenient' store," Lenard said of Dollar General. And stores that are convenient are popular with beer buyers.
 
Dollar General has the potential to be a significant marketer of beer. With 10,000 stores across the country, it has more locations than 7-Eleven, the nation's largest convenience store chain. That makes it handy; Dollar General said the majority of its customers live within three to five miles, or just a 10-minute drive, of its stores.
 
And Dollar General plans to open even more stores across the country. "We believe we have the long-term potential in the U.S. to more than double our existing store base" in both new and existing markets, Dollar General said in the SEC report.
 
The company also claims its prices are "highly competitive with even the largest discount retailers." Limiting the number of products on its shelves "helps us maintain strong purchasing power" with the suppliers whose products it does sell, according to its SEC report.
 
All of that gives Dollar General the potential to sell a lot of brew.
 
"Our customers buy beer elsewhere, and this was an opportunity for us to reinforce our convenient advantage," Tawn Earnest, Dollar General's senior director of corporate communications, told the Reuters news service in September 2011 after the company had secured permits to sell beer at dozens of stores in Arkansas.
 
But not every citizen is happy about their neighborhood dollar store selling beer. As recently as Monday, an alcoholic beverage board in Indianapolis denied a permit for one Dollar General to sell beer and wine after opposition came from community groups; two other company stores in the city were turned down in May, although some other locations won approval, according to WISH-TV there.
 
As for the convenience store industry that currently is dominant in package beer sales, "What our retailers most care about is the ability to have a level playing field and compete on equal terms, and may the best retailer win," association spokesman Lenard said.
 
Still, he said, "I don't think anyone looks forward to a day when Dollar General competes against them for beer sales."
 
(Chuck Stinnett is a reporter for the Gleaners in Hendeson, Ky.)
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