Dollar Tree Inc., the parent company of Family Dollar, announced plans to close nearly 1,000 stores across the United States, citing financial challenges and a strategic shift in operations. The closures include approximately 600 Family Dollar stores in the first half of fiscal year 2024, with an additional 370 Family Dollar and 30 Dollar Tree locations slated to shut down over the next several years as leases expire.

The decision follows a comprehensive review of the company's store portfolio aimed at identifying underperforming locations and investing in improved store standards and growth. Dollar Tree acquired Family Dollar for over $8 billion nearly a decade ago but has faced difficulties integrating the chain into its operations. Economic pressures, including inflation and reduced consumer spending, have impacted the retailer's low-income customer base.

Additionally, increased incidents of shoplifting have further strained profits. These factors contributed to the company's decision to record a $950 million impairment against the Family Dollar trade name, alongside a $1.07 billion goodwill charge. In a significant move, Dollar Tree announced the sale of the Family Dollar brand to Brigade Capital Management and Macellum Capital Management LLC for $1 billion in March 2025. This sale marks a strategic shift as the company focuses on its core Dollar Tree operations.

The closures are expected to have a notable impact on communities, particularly in areas where Family Dollar stores serve as primary retail outlets and employment sources. Retail analysts express concern over the potential creation of "retail deserts" in underserved regions. As Dollar Tree navigates these changes, the company aims to streamline operations and adapt to the evolving retail landscape, focusing on profitability and sustainable growth.