Dollar General has what Walmart, CVS don't: Access to rural America

Dollar General has its grip on something that the healthcare industry has struggled to access: rural America. Here are nine things to know about how the retail chain is poised to make significant moves in rural healthcare, according to an Aug. 9 Insider report.

In July, Dollar General hired its first CMO to expand its presence in healthcare, and many experts forecast it's showcasing that healthcare is the company's next sector to lay seeds in. 

Nine things to know:

  1. The $55.6 billion retail chain has 17,000 stores, mainly in rural communities. As many stores shut their doors amid the COVID-19 pandemic, it added 1,000 new stores. In 2021, it plans on adding another 1,050 stores. Additionally, 3 in 4 Americans live within 5 miles of a Dollar General.

  2. "Our extensive store footprint enables us to reach rural communities often underserved by other retailers and the existing healthcare ecosystem," a Dollar General spokesperson said in regard to the company hiring a CMO.

  3. Several other companies have deepened their presence in the healthcare industry during the pandemic, such as Walmart, Amazon, CVS and Google.

  4. Unlike these other companies, Dollar General has a strong presence in rural America. It could offer care to patients who live in areas where primary care or specialists are hard to come by. Telehealth, over-the-counter medications and online prescriptions could improve healthcare for rural Americans who are traditionally left behind in healthcare expansions.

  5. Walmart has run into issues reaching remote customers, the report said. Walmart tried to roll out express locations to directly compete with Dollar General. However, Walmart struggled to take over market share in these initiatives, said Neal Khosla, co-founder and CEO of healthcare artificial intelligence firm Curai.

  6. Dollar General could also drive traffic in pharmaceutical products since its prices are 40 percent lower than drugstore chains, Corey Tarlowe, an analyst for Jefferies, said. Many of Dollar General's customers do not have health insurance or live in pharmacy deserts, where the drive to the nearest pharmacy is far, the report said.

  7. "A viable model for them would be an online pharmacy, where you're not offering pharmacy per se in your stores, but you've got a white-label pharmacy business that's either delivering to stores for pickup or delivering to people's homes — avoiding that 30-minute drive to the local CVS or local Walmart," said James Gardner, a healthcare retail consultant.

  8. The retail chain has already positioned itself to move into the pharmacy and telehealth sector of healthcare. Dollar General inked a partnership with online pharmacy Genius Rx. The partnership enables customers to get prescriptions delivered to their homes.

  9. Dollar General also has a partnership with telehealth provider Babylon. Babylon is already offering free telehealth appointments at certain locations in Missouri. If Dollar General expands this relationship, it could become a more direct competitor with other retail giants entering virtual care, such as Walmart or Amazon.

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