NOVEMBER 29, 2006 - Posted at 4:01 p.m. CST
NASHVILLE, TN - Discount retailer Dollar General said today it plans to close 400 stores next year and open about 300 new locations to improve profitability.
The plan will cost about $138 million. Half of that is related to store closings and the other half to move away from Dollar General's "packaway" inventory management model. Under its new inventory strategy, Dollar General plans to sell off some $300 million in older merchandise to make way for newer products that are in season.
In the most recent quarter, Dollar General reported a 40 percent decline in profit on increased costs, despite slightly higher sales.
Dollar General, based in Goodlettsville, Tennessee, had 8,276 neighborhood stores in 34 states as of November 24. Arkansas has 222 of those stores, while 306 are located in Missouri.
The company did not disclose how many workers will be affected.