Dollar General CEO exposes bitter reality about today's economy

Thirty years ago, having a six-figure income meant you could live comfortably, with all the accoutrements of wealth.

These days, it’s just enough to make you a regular shopper at Dollar General.

As inflation continues to rise and economic headwinds continue to squeeze household budgets, the “value shopper” demographic is undergoing a major shift.

The latest proof of this phenomenon comes straight from Dollar General’s CEO, Todd Vasos, who revealed a bitter truth about the state of today’s economy during the company’s most recent earnings call.

The American consumer is sending mixed signals

For months, experts have been attempting to dissect the health of the American consumer. 

Some data seems to indicate that spending is climbing. For example, in April, the Bureau of Economic Analysis said that real-dollar personal expenditures increased by 0.5% to $111.1 billion dollars. 

While other data indicates that consumers are actually spending, or at least attempting to spend, less. A May report from McKinsey & Company found that shoppers intent to spend was down in almost every category except for gasoline. 

What’s frustrating about this debate for the casual observer, is that much of it feels theoretical. 

Real dollar spending may be up, but are Americans actually spending a higher percentage of their income? Or is that just a product of inflation? Consumers are expecting to spend less, but is that out of necessity? Or is that just tied to anxieties about the state of things?

During Dollar Generals’ first quarter fiscal year 2027 earnings call, we finally got some real, solid answers about the current state of the economy — and they’re not encouraging.

Americans aren’t buying less, Dollar General’s CEO Todd Vasos says, they’re just buying it from less-expensive retailers.

Dollar General sees growing demand from high-income shoppers

When discussing Dollar General’s consumer base, Vasos told analysts the company was seeing a major shift in the type of shopper frequenting its stores.

“We are seeing customer penetration growth across low, middle, and high income segments as customers across all income cohorts seek value at increasing rates,” Vasos said.

“Notably, across these cohorts, the largest increase in customer count came from the highest income segment, which earns more than $100,000 annually, contributing to a significant increase in trade in customer households during the quarter.”

In other words, the customers currently flocking to Dollar General are those who we would have considered comfortably wealthy just a few short decades ago. 

For most of its history, Dollar General has served rural and underserved communities, and the lower-income to middle-income households that make up those communities. 

That's why the company's fastest-growing customer group households earning more than $100,000 is such a notable shift.

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New data suggests more Americans are trading down

The shift seems to indicate that shoppers across all income brackets are feeling the financial pinch, and trading down as much as possible.

Vasos confirmed this, telling analysts “what we're seeing is… an accelerated rate of trade-in.” 

“We have seen that the upper end, while all cohorts are trading in, we're seeing that the upper end is trading in the most,” he continued. 

As to why this trade down is happening now, as opposed to a year or two ago? Vasos says it’s the rising fuel costs.

“I believe that the pressures that had persisted prior to fuel costs, so sustained inflation and now those elevated fuel costs [have triggered the shift],” he said. “When that price hits that $4 mark, and then crosses it, and then sustains for a while, you start to see that trade-in come in, and you start to see that our core customer needs us most. That's exactly what's happening.” 

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Vasos isn’t alone in spotting this trade down effect.

In 2025, 75% of consumers reported trading down in at least one category, according to McKinsey & Company. Even high-income households, those earning $100,000 or more, reported choosing lower-priced brands and retailers and private-label products more often than they had previously.

Median household income in the U.S. is fairly high at $83,730, according to the most recent data available from the U.S. Census Bureau.

Yet consumers continue to report heightened concerns about inflation and affordability.

Walmart, a retailer with fewer locations than Dollar General but much larger revenues, says its also experiencing the effects of these concerns.

"We do continue to see the higher-income customers coming to Walmart," Walmart U.S. CEO John Furner told reporters during a shareholder week event in early June, according to Fox Business. "We're meeting more of them, they're buying more, they're coming more frequently."

While consumer spending may look resilient on paper, comments from Dollar General and Walmart’s CEOs show that in reality shoppers are actually spending quite differently.

Rather than abandoning purchases altogether, consumers across income levels appear to be seeking lower prices, cheaper brands, and discount retailers wherever possible.

And if even households earning more than $100,000 are increasingly turning to stores like Dollar General, it may be a sign that economic pressures are reaching further up the income ladder than many traditional indicators suggest.

Related: Best Buy CEO drops major consumer warning on her way out