In 2024, Dollar Tree acquired 170 locations from 99 Cents Only after its bankruptcy, with a focus on sites that were performing better than other locations, Placer.ai reported. The research firm cited AI-powered location analytics that indicated Dollar Tree chose sites that were generating 6.0% more foot traffic than the 99 Cents Only chain average in 2023.
However, 2025 performance data shows that these newly converted Dollar Tree sites struggled throughout the year, posting a 38.8% drop in visits compared to the 99 Cents Only baseline for 2023.
According to Placer.ai, a significant portion of the foot traffic loss is due to cannibalization as 36% of the new sites are located less than a mile from an existing Dollar Tree.
Dollar Tree is already rightsizing these operations, Placer.ai said. 99 Cents Only ran a “high-frequency grocery model … [that] collapsed under the weight of ‘rising levels of shrink’ and low-margin grocery sales,” Placer.ai wrote. “By shifting the model, Dollar Tree is effectively filtering out non-paying visitors and low-value transactions, trading chaotic volume for a more controlled, margin-focused operation.”
As it shifts the model, Dollar Tree has left some "ghost space" inactive rather than over-investing in labor to manage the entire floor. This move to fix the operation style can be seen in the discrepancy between the sharp drop in total visits (-38.8%) and the more moderate dip in visits per square foot (-25.0%).
Additionally, the shopping demographic for these stores is key to their success. “The shift in shopper demographics—where ‘wealthy suburban families’ have replaced the ‘young urban singles’ and ‘melting pot families’ of the previous tenant—is crucial for Dollar Tree's future. This new audience, which is less price-sensitive, provides the ideal environment for Dollar Tree to deploy its "Multi-Price" strategy,” the market research firm reported.
“If Dollar Tree can utilize the extra square footage to showcase this higher-margin assortment, these locations could evolve from overlapping burdens into profitable flagships,” Placer.ai wrote.
In 2025, Dollar Tree sold its Family Dollar business for $1 billion, a fraction of the $9 billion acquisition cost it paid almost 10 years ago. About two years ago, Dollar Tree said it would close nearly 1,000 of Family Dollar’s roughly 8,000 stores.