Another day, another discount retailer closing its doors. This time, it’s Dollar General, the cheap shopper’s #1 resource across America. The company recently announced that it will shut the doors on nearly 100 store locations.
The store closures will be a mix of Dollar General and pOpshelf locations, which will happen soon. As of now, 96 Dollar General stores and 45 pOpshelf locations will shut down in the first quarter of 2025, the company disclosed in a March 19 announcement.
Dollar General To Close Stores ‘Challenging’ To Operate
The company announced these closures in its latest earnings report on March 13, 2025, following a “store portfolio optimization review” that evaluated individual store performance, expected future performance, and operating conditions.
CEO Todd Vasos noted that many of the stores targeted for closure, particularly the 96 Dollar General locations, are in urban areas that have become “increasingly challenging to successfully operate,” though no precise cities or addresses have been disclosed yet.
In recent comments, Vasos also noted that consumers are hurting, which hurting store sales. He said, “Many of our customers report they only have enough money for basic essentials, with some noting that they have had to sacrifice even on the necessities.”
The 45 pOpshelf closures represent about 22% of that brand’s footprint, but similarly, no specific sites have been named.
Additionally, six pOpshelf stores will be converted into Dollar General stores.
These closures represent less than 1% of the company’s total store base, which exceeds 20,000 locations across the U.S. Despite these closures, Dollar General is also planning to open approximately 575 new stores and remodel around 2,000 existing ones throughout 2025, indicating a net growth in its overall store count by the end of the year.
Why Is Dollar General Facing Financial Difficulties?
Operationally, Dollar General is grappling with declining profitability. Its operating profit fell 49% year-over-year in Q4 2024, driven by lower sales volumes, shrinking gross margins (down to 30% in Q2 2024 from 31.1% the prior year), and increased costs.
These costs include higher markdowns, inventory damages, and “shrink” (losses from theft or damage), as well as rising operational expenses like rent, labor, and supply chain logistics.
The decision to close certain stores stems from an internal review aimed at optimizing performance, particularly in underperforming or challenging urban locations, while the company continues to expand elsewhere. So, while some individual stores are shutting down, Dollar General as a company is not ceasing operations and is instead adjusting its footprint.
What Other Stores Are Facing Financial Troubles?
The year has been rough not only for Dollar General, but for several U.S. retailers. Here’s a look at those that have reported issues with their bottom line.
- Target: On March 4, 2025, Target reported a sales drop for February and forecasted flat comparable sales growth for 2025, citing economic volatility and “meaningful pressure” on profits due to new tariffs on imports from Mexico, Canada, and China, alongside other rising costs. Profits and sales slipped in late 2024, with consumer hesitancy evident ahead of the holidays, and shares are down nearly 15% year-to-date.
- Walgreens: The pharmacy chain is in the midst of closing 1,200 stores by 2027, with 500 slated for fiscal year 2025, as part of a cost-cutting strategy amid financial strain. This follows years of challenges, including declining foot traffic and profitability in its retail pharmacy segment.
- Joann: The craft retailer has faced severe financial distress, filing for Chapter 11 bankruptcy twice—first in March 2024 and again in January 2025. It plans to close 500 of its roughly 850 stores nationwide as part of its restructuring, burdened by $1 billion in debt despite securing $132 million in new financing in 2024.
- Kohl’s: The department store chain announced on January 10, 2025, plans to close 27 underperforming stores by April 2025, representing less than 3% of its 1,150+ locations. This follows closures in San Diego due to unmet financial expectations, pointing to broader difficulties in maintaining profitability.
- Party City: After filing for bankruptcy in 2023, Party City continues to struggle, with reports indicating 695 store closures in 2025 alone. Private equity ownership has been blamed for loading the company with debt, exacerbating its financial woes.
- Big Lots: The discount retailer is among those hit hard, with 1,728 total store closures reported across struggling chains in 2025, including a significant number from Big Lots. Its financial difficulties stem from a weakening consumer base and operational inefficiencies.
- Forever 21: The fast-fashion chain filed for bankruptcy for the second time in six years in 2025, citing inflation, competition from online rivals like Shein and Temu, and shifting consumer preferences as key factors in its decline.
- Advanced Auto Parts: Facing a tough retail environment, the company plans to close over 700 locations by mid-2025 as part of a new three-year financial recovery plan, reflecting broader struggles in the auto parts retail sector.
- Macy’s: While undergoing a restructuring, Macy’s is consolidating its physical locations in 2025, with shares slipping 2% in early March amid long-standing difficulties. Consumer uncertainty has hit middle-market retailers like Macy’s harder than discount or luxury brands.
Other retailers like Starbucks, Dollar Tree, Office Depot, and JCPenney are also closing select underperforming locations in 2025, though their overall financial situation has not as of yet appeared to be as dire as those named earlier.
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