Business

Discount retail giant, Family Dollar, closes 350 U.S. stores , sparing only six states

By Nina Zdinjak TheStreet

Updated May 20, 2026 4:48 PM

I remember the time when I could go to our local supermarket and buy everything I needed for a week or two. However, those times are long gone, as the current environment has turned many of us into deal hunters, who go from store to store, or compare prices online, just to save a couple of bucks.

Those couple of bucks might seem like nothing, but when you have children to take care of, every penny counts.

While large corporations look at spreadsheets to optimize store locations, nearly a third of parents with children are wondering how they will afford their next grocery bill.

More precisely, "in December 2025, 32.0 percent of adults ages 18 to 64 living with children younger than age 18 reported household food insecurity in the last 12 months," according to the Urban Institute Well-Being and Basic Needs Survey, published in March 2026.

To comfortably raise two children by federal affordability standards, an American family now needs to make an eye-popping $402,708 a year, according to the LendingTree Child Care Affordability Study.

In reality, the typical household brings home just a fraction of that ($145,656), a very real math problem that explains why millions rely on discount retail chains just to survive. Yet, those very discount brick-and-mortar stores that many families rely on are slowly disappearing from their neighborhoods.

Justin Sullivan on Getty Images

Family Dollar closed 350 stores over the past 10 months

In March 2024, discount retail giant and the parent company of Family Dollar, Dollar Tree, first announced plans to close around 1,000 locations.

"We plan on closing approximately 600 Family Dollar stores in the first half of fiscal 2024. Additionally, approximately 370 Family Dollar and 30 Dollar Tree stores will close over the next several years at the end of each store's current lease term," the company disclosed in the Q4 fiscal 2023 press release.

According to a later Dollar Tree 2024 annual report, the company confirmed the exact progress of its optimization plan, highlighting that "as of February 1, 2025, we had closed approximately 695 stores."

A more recent analysis by Local Falcon, reveals Family Dollar has permanently closed at least 350 stores between July 7, 2025 and May 12, 2026.

"The chain has shed roughly one storefront per day on average over the 309-day period," reveals the report.

These closures represent a 4.69% reduction in the size of the chain, suggesting that the retailer now still runs some 7,112 locations across the country.

Moreover, according to Dollar Tree's filing with the Securities and Exchange Commission (SEC), on February 3, 2024, there were 8,359 Family Tree locations. The numbers suggest that over the past two years, 1,247 Family Dollar locations across the country were closed.

In the meantime, the popular discount chain went through a major business change, as Dollar Tree sold the entire Family Dollar business segment to Brigade Capital Management, Macellum Capital Management for roughly $1 billion in cash, according to Dollar Tree July 7 press release.

Six states didn't lose any Family Dollar store in the last wave of closures

The closures that happened over the past 10 months, haven't equally affected all states, with as many as six not seeing a single closure.

Texas, the state with most Family Dollar stores, also lost the most by raw numbers, as 35 locations were closed permanently in the past 10 months. Ohio came next with 28 closures, after which Georgia saw 26 closures.

States that did not lose a single store:

Idaho: still has 54 stores.
Massachusetts: still has 87 stores.
Montana: still has 34 stores.
South Dakota: still has 28 stores.
Utah: still has 55 stores.
Wyoming: still has 35 stores.

Source: Local Falcon

New Mexico, lost only one, still counting 114 stores, making it the least affected with the latest closures.

Percentage-wise, Arkansas was mostly affected as it lost 13.09% of its Family Dollar footprint, when 15 closures left the state with 93 locations.

Local Falcon's methodology used Family Dollar's public store locator at the start and end of the period. Each store listing that had been removed and had returned a 404 error was then independently verified against Google Maps.

Why is Family Dollar closing hundreds of stores nationwide

During the Dollar Tree Q4 2023 Earnings Call on March 13, 2024, the company CEO Rick Dreiling talked about the state of the economy and its effect on consumers, and subsequently on Family Dollar stores.

"Persistent inflation and reduced government benefits continued to pressure the lower-income consumers that comprise a sizable portion of Family Dollar's customer base. Accordingly, Family Dollar's quarter four comp declined 1.2% as a 0.7% traffic increase was more than offset by 2% ticket decline," said Dreiling, according to the transcript provided by InsiderMonkey.

Dollar Tree added that as lower-income consumers continue to be "very deliberate about their spending," the challenges remain structural, highlighting that a "well-run and well-located Family Dollar store is a powerful retail force."

Family Dollar's parent company at the time basically explained that it was necessary to cut all underperforming stores to optimize the business.

In a March 2026 update, Family Dollar revealed it is amid a massive transformation with the goal of enhancing its key operations, simplifying the business, and improving its position for long-term growth.

"Over the past year, we've taken disciplined actions to strengthen the foundation of Family Dollar, and the progress we're seeing reflects the focus and commitment of our teams across the organization," Chairman and CEO of Family Dollar Duncan McNaughton shared in a statement.

In the same report, Family Dollar revealed that its financial planning reflects around 25% EBITDA growth in fiscal 2026 compared to fiscal 2025, driven by positive comparable sales growth and ongoing execution of its Value Creation initiatives.

Among the company's key initiatives is the new store format: Extra Small Box (XSB).

"It is a smaller and more flexible store design that requires less inventory and lower operating costs," reported TheStreet's Aparajita Chatterjee. The new format should help the retailer expand across "high-intensity neighborhoods," complementing its existing store base.

How affordable is Family Dollar

Consumers around the world are familiar with dollar illusion: when discount chain stores sell smaller pack sizes that seemingly cost less, but when it comes to the actual price per pound the reality is cruel.

Nonetheless, these stores have their purposes indeed. They appeal heavily to cash-strapped consumers who can't afford a $500 trip to Costco, but have $30 in their pocket to get through the week.

According to a 2023 study by Bank of America and reported by Supermarket News, Walmart and Aldi had the best prices for food and other necessities.

The study outlined the breakdown of the identical 33-item basket across stores:

Walmart: $187.50
Target: $194.15
Dollar General: $201.14
Family Dollar: $203.67

The report further showed that Walmart and Aldi had the most affordable grocery prices across a range of food, and Aldi rules every category except household and personal care goods.

On the other hand, a more recent analysis by FinanceBuzz revealed that Family Dollar's private-label house brands frequently undercut Walmart's offering. Additionally, the discount chain provides the Family Dollar Smart Coupons app, enabling shoppers to stack weekly deals.

It appears that for the most affordable shopping experience, consumers need to monitor discounts and promotions heavily. Two other important factors that play a role are the proximity of a store that offers a lower price for the same item, and if a consumer can afford larger packs, which are often cheaper per pound and therefore more affordable over a longer period.

What Family Dollar closures mean for consumers

"Nearly seven in 10 retail executives surveyed agree that behaviors such as trading down, shopping value channels, or swapping convenience for savings represent a structural change, not a temporary response to inflation," reveals Deloitte's 2026 Retail Industry Global Outlook.

Taking this into account it is apparent that value-seeking consumers are not going away, which means that Family Dollar closure will definitely impact a number of customers.

While Family Dollar might not be the cheapest option out there, for many shoppers it is the only alternative at the moment, whether they resort to it because they can only afford smaller packs or can't afford a trip to a larger supermarket.

Dominick Miserandino of RetailWire, suggested these closures could hit some communities hard.

"They might be the only store that serves the entire community in this area," Miserandino told CBS News. "They might have been one of the few jobs in the community."

Additionally, the lack of competition within the market can result in higher prices, because retail giants often resort to ultra-low prices initially to capture market share. However, once the local competition vanishes or retreats, such as Family Dollar closing 350 locations for example, the surviving corporate giant quietly raises prices.

" First, a new big box chain can drive smaller grocers and other local retailers out of business. And what about those low, low prices? They do not necessarily stick around. Walmart has been known to raise food prices once it becomes the dominant grocery retailer in town," writes Food and Water Watch.

Hopefully, Family Dollar's renowned strategy and focus on new store formats will fill the communities with more choices again.

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This story was originally published May 20, 2026 at 4:37 PM.