questions 1-3 for the case study, would appreciate help on this! i have included the pages for the case study as well!

PART 2: Case Analysis Read the attached case study on Dollar General, and answer the following questions. 1. What opportunities does Dollar General highlight as differentiation strategy to boost growth? 2. What seemed to be the main factor that apparently contributed to the increase in the firm's operating profit between 2009 and 2011? 3. What are some of the threats that could prevent Dollar General from achieving its vision of growth? CASE 24 Dollar General Corporation: 2011 GROWTH EXPANSION PLANS (MINI CASE) Kathryn E. Wheelen Expansion Plan On January 6, 2011, the management of Dollar General announced its 2011 ex- pansion plan for the company. Dollar General had plans to open 625 stores, add 6000 employees, and open stores in three additional states---Connecticut, Nevada, and New Hampshire. Recently, the company announced plans to open stores in Colorado In addition, the company intended to remodel or relocate 550 of its 9200 stores in 35 states. Each store averaged 6 to 10 employees, a combination of full-time and part-time employees. Employees had the option of flex-time, and wages were competitive to the local market wages. The company had 79,800 employees altogether! Industry The dollar discount store industry's primary competitors were Dollar General, the largest company, with revenues of US$12.73 billion; Family Dollar Stores, with revenues of US$8.04 billion; and Dollar Tree in third place with revenues of US$5.71 billion. The industry's total revenue was US$36.98 billion. See Exhibit 1 for information on each of the three major players in this industry segment. The discount variety store industry's main competitor was Wal-Mart, with revenues of US$419.24 billion, 2,100,000 employees, and an income of US$15.11 billion. Wal-Mart operated more than 3500 stores and supercenters and 596 Sam's Clubs in the United States. This case was prepared by Kathryn E. Wheelen. Copyright 2010 by Kathryn E. Wheelen. The copyright holder is solely responsible for the case content. This case was edited for Strategic Management and Business Policy 14th edition. Reprinted by permission only for the 14th edition of Strategie Management and Business Policy (includ. ing international and electronic versions of the book). Any other publication of this case (translation, any form of electronic or media) or sale (any form of partnership) to another publisher will be in violation of copyright law unless Kathryn E. Wheelen has granted additional written reprint permission 24.1 24-2 CASE 24 Dollar General Corporation EXHIBIT 1 Direct Competitors of Dollar General (Data is trailing 12 months) A. Dollar Discount Stores Competitive Information Dollar General Net sales (millions) $12,735 YoY Chg 8.00% 3-Year CAGR 10.3% Comparable sales Chg 5.8% Gross margin 32.0% Operating margin 9.0% Profit margin 3.9% Operating income (millions) $1,145 YoY Chg (in bps) 27.6% Net income (millions) $493 YOY Chg 47.4% 3-YR GAGR N/A Diluted EPS $1.43 YOY Chg 36.2% 3-YR CAGR Store count 9,273 Retail selling Sq. Ft 66,270,000 Employees 79,800 B. Average Sales Dollar General Avg. sales/selling sq.ft $198 Avg, sales/stores (1,000) $1,408 Avg, sales/employee $155,758 Family Dollar $8,041 7.6% 5.1% 5.9% 35.7% 7.3% 4.5% $588 23.8% $365 21.8% 14.9% $2.72 27.1% 18.6% 6,852 48,721,000 50,000 Dollar Tree $5,716 13.0% 10.3% 7.1% 35.3% 10.3% 6.5% $590 7.1% $370 27.2% 21.9% $2.84 33.1% 27.6% 4,009 34,400,000 54,480 N/A Family Dollar $167 $1,189 $162,116 Dollar Tree $172 $1,464 $172,671 SOURCE: http://seekingalpha.com/article/245097-discount-retail-throwdown-a-closer-look-at-dollar-stores?source= yahoo. Used by permission of the author, Josh Ramer of RetailSails.com Wal-Mart also had stores overseas in several countries, with its largest non-U.S. markets con- sisting of 371 stores in the UK and 279 stores in China. Target was in second place with revenues of US$66.91 billion, 351,000 employees, and net income of US$2.82 billion. It operated 1746 stores in 49 states. Other large discount store companies were Costco Wholesale Corporation and Kmart Corporation.' Corporate Ownership XKR (Kelder Kreis Roberts Co LP):17 (120 company wack on September 30, 2010 March 12, 2007. KK Doll for US$732 billi KKR ve equity companyia 315 US$16.78. Goldman Sachs Group Inc. w 17.175 (1.712235.45 pany's neck. Combine two companies of General Goldman Sachs w KRS is deal, while Land and the Dollar General's Dolls route the presented the bring of employees with stoupport family, and new althode for this plays in the women who will CASE 26 341 Acording to the Padua Chama 5. Bei only 1.7%. 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Al Doilleen het oppomunities will be for its relocation de program Remode US$65.000 forint and future, while the cost of pro U55110,000 for find into Datter General al eredetinere modeled and in 2009, come in 2008 d300 2007 The following that shows Download 2009 2008 S 1459 The 7:40 52 2001 SON NA Finance Ex shows the commandeshers, start of income for Date The By facial mismo ped by man for 2010 Management mood that they had til at det US$1964 Million coloanwich 20 USS million pregate pencipalment of 10623 2015 USS principal amount of 118754212625 wibowo This debt could have given to the dating Ses per profit, aspects of all 24-4 CASE 24 Dollar General Corporation January 28, 2011 January 29, 2010 EXHIBIT 2 Dollar General Corporation and Subsidiaries Consolidated Balance Sheets (in thousands except per share amounts) $ 497.446 1.765,433 104.946 2.367,825 1,524,575 4,338,589 1.256.922 58.311 59,546,222 $ 222,076 1.519.575 7563 96.252 1.845449 1,328,385 4338 589 1.284.283 66.812 $ 8,863.519 Assets Current assets: Cash and cash equivalents Merchandise inventories Income taxes receivable Prepaid expenses and other current assets Total current assets Net property and equipment Goodwill Intangible assets, net Other assets, net Total assets Liabilities and shareholders' equity Current liabilities: Current portion of long-term obligations Accounts payable Accrued expenses and other Income taxes payable Deferred income taxes payable Total current liabilities Long-term obligations Deferred income taxes payable Other liabilities Commitments and contingencies Redeemable common stock Shareholders' equity: Preferred stock, 1.000 shares authorized Common stock: 50.875 par value, 1.000.000 shares authorized, 341,507 and 340,586 shares issued and outstanding at January 28, 2011 and January 29. 2010, respectively Additional paid-in capital Retained earnings Accumulated other comprehensive loss Total shareholders' equity Total liabilities and shareholders' equity $ 1.157 953.641 347,741 25,980 36,854 1,365,373 3.287,070 598_565 231.582 $ 3.671 830953 342.290 4.525 25,061 1,206,500 3.399,715 546.172 302 348 9.153 18.486 298,819 298.013 2.945,024 830.932 (20.296) 4,054,479 $9.546.222 2.293.377 203.075 (34.167) 3,390,298 58.863.589 SOURCE Dollar General Corporation. 2010 Form 10-K. p. 64 CASE 24 Dollar General Corporation 245 EXHIBIT) Dollar General Corporation and Subsidiaries Consol dated Statements of income On thousands except per share amount Net Cost of goods sold Gross profit Selling general and administrative expenses Litigation and related cost Operating profit Interest income Interest expense Oherme) expense Income before income Income tax expense Netice Buning per share Base Dauid Weighted average share Basic Diluted For the lear Ended Juary January 29 January 30, 2011 2010 2009 $13.035.000 $11.796.380 $10,457,668 8838.444 3.105.500 7,396.571 4.176.556 3,689.871 3,061.097 2.903.491 2.736,613 2.465.611 32.000 1.274,065 933.258 $50,456 220) (146) 03.061) 276212 545.746 391.932 15.101 55.542 2.788 954972 552.110 194403 357,115 212674 86221 5 627.8575399.4425108.182 5 1.345 1825 Loss 1045 034 0:34 341.07 340300 322.775 32486 317.034 317.500 SOURCE: Dor General Copen. 2010 Fm 10.5 Operating profit Inventory turnover Cash flow Net income Earnings per share Earnings before interest, income taxes, depreciation, and amortization Return on invested capital Management's positive on the impact of debt on the company was stated in the following Increasing the difficulty of our ability to make payments on our outstanding debe Increasing our vulnerability to general economic and industry conditions because our debt payment obligations may limit cur ability to use our cash to respond to our cash flow to fund our operations, capital expenditures, and future business opportunities of pay dividends Limiting our ability to obtain additional financing for working capital expenditures, debe service requirements, acquisitions, and general corporate or other purposes Placing us at a disadvantage compared to our competitors who are less highly leveraged and may be better able to use their cash flow to fund competitive response to changing industry, market or economic conditions