Executive Summary The objective of this paper is to make a strategic analysis of the functioning of Dollar Tree Inc, a discount variety merchandise retailer operating in the United States. The company is regarded as one of the top ranking player in the industry closely competed by firms like Family Dollar, Dollar General and 99 Cent Only. The analysis is designed to cover external analysis of the industry in which Dollar Tree is operating, internal analysis of the firm and strategic formulation for Dollar Tree Inc. An analysis of the macroeconomic environment of United States, the discount variety retail industry and the operations of the major competitors of Dollar Tree is presented under external analysis segment. The macroeconomic analysis identifies three distinct changes during the period of last five years; rapid industrialization of China and the expansion in the service industry of India and the resultant growth in these emerging economies have a significant impact on the economic conditions of United States, Secondly the growth of baby boomer population while provides enhanced sales growth opportunities for the retailers also makes a serious impact on the economy by increased government spending on social security costs. The third change in the form of phenomenal growth in the users of internet has proved to be an opportunity for growth of online marketing and advertising. Industry analysis was conducted based on the Five Forces Model advocated by Porter. This analysis suggests low barriers to entry, poor bargaining power of suppliers, high impact of customer power, moderate threat from substitute products and stiff competition from the rivals. Analysis of financial results of the company, value chain analysis and VIRO analysis formed the internal analysis of the firm. The value chain analysis made a comparison of the values of Dollar Tree and Family Dollar for commenting on the relative position of Dollar Tree. The analysis suggests an improved performance of Dollar Trees in the areas of operating performance. The company appears to be better placed in the areas of human resources management, technological development and efficiency of marketing and sales functions as compared to Family Dollar. Resources of Dollar Tree are its established presence in more number of locations and an efficient supply chain. Metrics and histories for the company have been measured by turnover figures, net income, Return on Assets (ROA), Return on Equity (ROE) and sales per square footage for the past three year period. The metrics indicate a progressive growth of the company during the period reviewed. Sales of the company Dollar city will be impacted by population growth and changes in consumer habits are the major factors that influence the demand for the products being offered by Dollar Tree. The recessionary trends in the economy and seasonal factors also influence the demand for the products of Dollar Tree. Store expansion and new store opening are the business strategies being adopted by Dollar Tree for the growth of its business. Offering added value to the customers through the variety of products offering is also adopted as one of the business strategies by the company. The low cost strategic options of improving the supply chain efficiency, internet marketing and sales promotion and expanding the private label merchandise have been recommended for achieving future