Dollar General Corporation DG

The business

Twenty-one thousand and fifty-five small boxes, mostly in towns with no other grocery, selling the paper towels, the shampoo, the dog food and the frozen dinner at prices that are usually under ten dollars. About four fifths of it is consumables, which brings the customer back weekly and earns very little per item. The rest is seasonal goods, home and apparel, which earns the margin.

The customer is often on a fixed income and shops the week rather than the month. That is the strength, because the trip does not stop when the economy softens, and it is the constraint, because there is no room to take price when the customer is counting. Fifteen minutes to the nearest Walmart is the whole moat.