Dollar General announced that it would close 96 of its stores and 45 of its pOpshelf brand stores, pulling the plug on a total of 141 stores across the U.S. in 2025. The decision was made in the midst of an increasingly challenging retail environment, shifts in consumer behaviors, and economic strain.
While the closures represent fewer than 1% of Dollar General’s sprawling network of over 20,000 stores, the impact on affected communities is considerable. The company’s strategic change is intended to maximize productivity and focus energy on more profitable locations, reflecting broader trends within the current unstable retail climate.
The Numbers Behind the Shutdown
For the 2024 fiscal year, Dollar General reported a net income of $1.1 billion—an abrupt decline of 32.3% from the previous year—while net sales rose 5% to $40.6 billion. The company indicated that the store closures are due to rising operating costs and underperforming stores.
While a painful and drastic move in the short term, Dollar General believes this move is necessary for long-term stability and growth.
A Word From the CEO
Dollar General CEO Todd Vasos candidly acknowledged the closures as a necessary strategic realignment. “We are committed to serving our core customers,” he said, adding that the action is taken to increase operational efficiency and long-term sustainability.
However, the store closures might strengthen its future; they will also include a $232 million write-down for the fourth quarter of the 2024 fiscal year.
Market Oversaturation from the Start
As Dollar General stores begin to close this year, some might argue that their aggressive store-opening plan—opening thousands of locations in rural and suburban America—initially generated quick growth but eventually failed.
The excessive number of stores cannibalized sales, and they began to compete with each other in overstored markets. This overstored condition strained supply chains, diluted brand value, and accelerated diminishing profitability, setting the stage for the store closures in 2025.
pOpshelf’s Short-Lived Experiment
Dollar General launched pOpshelf in 2020 with lofty aspirations: to break into the suburban market with home furnishings, seasonal products, and cosmetics, all at bargain prices.
It was aimed at middle-income households, earning roughly between $50,000 and $125,000 annually, who wished for style but at a budget-friendly price. Unlike traditional Dollar General Stores, pOpshelf has bright colors and displays aimed at impulsive buying.
pOpshelf’s Unexpected Failure
Initially set to grow to over 1,000 stores by 2025, pOpshelf never gained enough momentum, and now, five years later, 45 pOpshelf stores are to be shut down, and six will be repurposed as Dollar General stores.
Its failure shows the challenge that even large chain stores face when they attempt to expand into saturated and highly competitive market niches.
The Human Cost—Communities Left Behind
Despite initially oversaturating the market in some regions, the closing stores’ impact will reflect on more than the company’s balance sheets—they will significantly affect communities, particularly in low-income and rural areas where Dollar General is a vital destination for groceries and home supplies.
In urban centers, such as Murfreesboro, Tennessee, the loss of Dollar General stores can exacerbate food insecurity. With fewer transportation options in these areas, residents may be left with limited access to supermarkets, leading to higher costs and a greater reliance on convenience stores.
The Effect on the Elderly and Students
Moreover, older citizens and Middle Tennessee State University students have previously relied on those stores for basic necessities. For many individuals in these demographics, Dollar General is the closest source of fresh vegetables, fruits, or health supplies.
Store closures have a significant chain reaction, exposing the social consequences of decisions driven by corporate efficiencies and profit margins.
Retail’s Broader Reckoning
Dollar General is far from the only one cutting back. Up to 15,000 retail stores could close their doors nationwide in 2025 alone, according to Coresight Research. Retailers, such as Big Lots, Party City, JoAnn, and even behemoths, such as Bed Bath & Beyond and Macys, have announced waves of closures or gone bankrupt.
Retailers across all sectors are reacting to High operational costs, online competition, and demographic shifts.
Less Foot Traffic Means Fewer Stores
As mall foot traffic drops and digital-native businesses capture market share, brick-and-mortar retailers must confront a bitter new reality. One where consumers no longer spend hours walking past their stores, but instead one where consumers want a more convenient shopping experience.
These store closures are part of a larger change in the American retail landscape, where only those who can move fast and creatively will survive the storm.
Strategic Retrenchment or Corporate Retreat?
Dollar General frames its 2025 store closures as a strategic pullback, but its detractors call it a sneaky corporate pullback. The company has said that it’s closing stores to make it more efficient, but could it simply be a step back from saturated and increasingly unprofitable markets?
Now, unless Dollar General pairs this “strategy” with meaningful investment in technology, logistics, and customer experience, it could be a harbinger of complacency rather than resilience.
A Retreat from Economically Distressed Communities?
Dollar General has presented this latest development as a strategic consolidation, but critics argue the closures resemble a retreat from economically distressed communities. Some of the closing stores are located in areas with few other low-cost options, leaving residents with reduced access to affordable goods.
The company could focus on suburban markets or areas with more per-store profitability. However, while optimizing the store portfolio is a sound business move, it calls into question the company’s social responsibility. Is Dollar General actually restructuring, or simply abandoning communities that have been its customer base for years to make an easier profit?
The Pandemic’s Lingering Shadow
We have all seen the effects that the COVID-19 pandemic had on the retail landscape. It reshaped consumer expectations, behavior, and, therefore, the overall retail dynamic. Retailers with weaker digital infrastructure, such as Dollar General, could not transition quickly enough.
Now, some of Dollar General’s locations headed for closure simply never recovered from their pre-pandemic performance. This shows that even national chains are vulnerable to external crises that drive behavioral shifts.
How Some Stores Survived the Pandemic
Online shopping accelerated as people avoided face-to-face contact, and much of that changed purchasing behavior has persisted. The stores that managed to survive, such as some Big-box retailers, expanded by using same-day delivery, curbside pickup, and optimizing e-commerce and logistics strategies.
However, Dollar General remained largely brick-and-mortar and was slower in embracing online retail and investment in omnichannel infrastructure, making it more vulnerable to changes in consumer habits.
Might This Be a Necessary Evolution?
Not everyone sees these store closures as a failure. Some argue that eliminating underperforming locations is necessary for long-term sustainability. By shutting underperforming stores, the company can re-allocate capital to more profitable businesses.
For example, Dollar General plans to renovate 4,000 stores to enhance customer shopping experiences, open 575 new stores, and expand into Mexico this year. This type of strategic readjustment is just what such companies might need to ensure that their resources can be adapted to high-performing markets and innovation.
Trying to Emerge Stronger
Moreover, Dollar General is not alone in trying this approach. Walmart, Target, and CVS have all closed stores to optimize their strategies and emerge stronger. By exiting low-margin locations and doubling down on performing markets, Dollar General can focus more on supply chain enhancements, data-driven inventory, and enhanced labor allocation.
From this perspective, the store closures are not an ominous sign but an indication of the maturity of operations. In a highly competitive sector, this could be the only way to survive and succeed.
Retail’s Cyclical Nature
This is not retail’s first reckoning, as the industry often goes through cycles of aggressive growth followed by sharp declines. For example, Walmart’s rise in the 2000s swallowed traditional, mom-and-pop shops. In the early 2000s, shopping malls were being built everywhere at the expense of department stores such as Sears and JCPenney.
Then, in the 2010s, malls collapsed as Amazon rose. Discounters are now being pinched by inflation, online competition, and shifting consumer expectations. Historical trends show that the ones that fail to innovate—like RadioShack or Sears—fall behind.
Historical Trends Playing Out
Dollar General’s contraction is reminiscent of past cycles where dominant retailers were forced to reinvent or perish. In its eagerness to take over underpenetrated markets, the business replicated an age-old recipe—swamping markets with stores, growing beyond need, and suffering eventual collapse in weaker markets.
Dollar General’s future may hinge on learning from past collapses, adapting faster, and rediscovering its value in a world where price and convenience are no longer its sole selling points.
Reinvestment and Realignment
Despite losing over 140 stores, Dollar General is not giving up. The retailer is gambling on modernization, remodeling thousands of stores, opening new ones, and expanding its private label offerings.
It’s also adding self-checkout lanes, testing health clinics, and putting more refrigerated food on shelves. Meanwhile, its international ambitions are growing, with new stores in the works in Mexico.
Dollar General’s overall strategy is one of reinvestment and realignment. Whether or not it pays off will depend on how effectively Dollar General balances cost-cutting with innovation and whether or not consumers continue to find its evolving model both affordable and essential.
Resilience and Reinvention
Retail resilience depends on adaptation, not just expansion. Dollar General’s closures, while disruptive, may signal a necessary pivot toward smarter growth, modernization, and digital integration.
Reinvention is essential in today’s evolving marketplace. If Dollar General learns from past missteps and invests wisely, it can emerge leaner, stronger, and more relevant, proving that even legacy retailers can thrive through strategic reinvention.
Discover more DIY hacks and style inspo- Follow us to keep the glow-up coming to your feed!
Love content like this? Tap Follow at the top of the page to stay in the loop with the latest beauty trends, DIY tips, and style inspo. Don’t forget to share your thoughts in the comments — we love hearing from you!