Dollar General brings former CEO Todd Vasos back to lead the struggling retailer
- Category: News
Dollar General has reappointed its former CEO in an effort to rejuvenate its struggling business.
The discount chain announced on Thursday that it had reinstated Todd Vasos as CEO, replacing Jeff Owen. Vasos had previously held the role for seven years before retiring in 2022.
The change in leadership is effective immediately, according to the company. Owen’s tenure as CEO lasted less than one year.
The Board has determined that a change in leadership is necessary
Michael Calbert, the chair of Dollar General’s board of directors, stated in a press release, “At this time, the Board has determined that a change in leadership is necessary to restore stability and confidence in the Company moving forward.”
Following the announcement, Dollar General’s stock, which has been under pressure this year, surged in after-hours trading on Thursday. The company has experienced a slowdown in growth since Owen assumed the role of CEO in November of the previous year. In August, Dollar General reduced its sales and profit projections for the year, attributing the decline to weaker consumer spending and increased theft. Earlier in the year, employees protested against a pattern of federal safety violations and violent incidents at the chain. External economic factors may have also contributed to the discount chain’s decline.
Dollar-General names Todd Vasos CEO, shares pop after the bell
Dollar General employees protested unsafe working conditions at the store
Retail analyst and Managing Director at GlobalData, Neil Saunders, told CNN that Dollar General’s slowdown was partially due to its customer base feeling the financial strain of rising living costs. “This has been exacerbated by cuts in SNAP payments as temporary pandemic benefits came to an end. As a result, lower-income shoppers are cutting back on non-essential and discretionary purchases from the chain in an effort to save money,” he explained.
Wall Street appeared to lose confidence in Owen’s leadership, and earlier this year, Dollar General employees protested unsafe working conditions at the store. The company’s stock has fallen by nearly 60% since the beginning of the year.
In contrast, during Todd Vasos’ seven-year tenure as CEO, Dollar General more than doubled its market capitalization. The company also expanded its store base by approximately 7,000 and increased annual sales by more than 80% during that period. In a statement, Vasos expressed his goal of revitalizing the company and restoring it to a robust position.
He stated, “I look forward to rejoining the extended team to work towards achieving operational excellence for our employees and customers, and to provide sustainable, long-term growth and value for our shareholders.”
At least one Wall Street analyst viewed the change in leadership positively. Oppenheimer’s senior analyst, Rupesh Parikh, described the change as “unexpected” but suggested it “could potentially restore confidence” in the retailer.
