Dollar Tree Targets Affluent Shoppers With Expansion Into High-End Areas
High-end shoppers are driving growth for Dollar Tree, so the Chesapeake, Virginia-based discount chain has started moving into their neighborhoods.
Over the last six years, nearly half of Dollar Tree’s new U.S. locations opened in affluent ZIP codes that had median household incomes higher than the regional average. That is a big step up from the just over 40% of new stores that the company opened in high-income areas during the preceding six years, Bloomberg reported.
The chain opened more than 25% of its new stores last year in ZIP codes with median household incomes of $100K or more. Dollar Tree even debuted its 9,000th store last year, in Plano, Texas, an affluent Dallas suburb that offers Porsche and Ferrari dealerships within blocks of the discount retailer.
That expansion into more affluent neighborhoods is paying off for the brand.
Shoppers making more than $100K per year accounted for 60% of Dollar Tree’s 3 million new customers during its most recent quarter, while another 30% came from middle-income households.
Executives said high-income customers visit Dollar Tree less frequently than typical shoppers but spend $1 more per visit on average. One additional visit per year from those high-end shoppers could add $1B in annual sales to the company’s bottom line, officials said.
During Dollar Tree’s December earnings call, CEO Michael Creedon said spending grew across all income groups last quarter.
“To us, this demonstrates that Dollar Tree isn't just for tough times or for those with limited resources,” Creedon said.
The company’s stock was up 67% from last year, and its 2025 revenue is expected to be 10% higher than the year prior, according to Bloomberg. That would be Dollar Tree’s fastest annual growth in almost a decade.
“It’s a lot easier to make money selling to the high end than the low end,” Hedgeye Risk Management analyst Daniel Biolsi told Bloomberg.
To help attract affluent shoppers, the discount chain has expanded its safety and compliance procedures and is working to improve existing stores. Dollar Tree is also renovating more than 100 locations and enhancing around 3,000 stores, Bloomberg reported.
Dollar Tree expanded into higher-end areas of the U.S. during the 2008 recession, then retreated to focus on lower-income shoppers when the economy improved. The company paid $9.2B for Family Dollar in 2018 but then sold it for just over $1B last year.
The company also picked up some extra locations in 2025 after Party City folded. After the party supply store announced it would go out of business in 2024, Dollar Tree and fellow discount retailer Five Below picked up dozens of the chain’s former locations at auction last year.
Dollar Tree also took advantage of a different retailer's bankruptcy in 2024, nabbing leases for 170 former locations of 99 Cents Only Stores.
