Dollar General to add tobacco in 2013

Competitive pressures and a perceived customer demand have prompted Dollar General to add cigarettes and other tobacco products to the majority of its 10,000 U.S. stores by the middle of 2013.

Family Dollar began that same initiative last year and says about a third of its customers are smokers, compared with less than 20% of the general population.

Analyst Mark Montagna of Avondale Partners in Nashville likes the idea

“I think it’s smart,  it’s what the customer wants,” he said.

Montagna notes the company has been testing this in Nevada since last year, before adding tobacco this year in Florida.

Initial tests indicate the average purchase per customer was $14 in stores where tobacco was sold, compared to $11 otherwise.