"Our core lower-income customers have faced high unemployment levels, higher payroll taxes, and more recently reductions in government-assistance programs," Levine said. "All of these factors have resulted in incremental financial pressure and reduction in overall spend in the market." But the deal provides a valuable opportunity for Dollar Tree to stake a bigger space in the deep-discount market. Aside from Dollar General, one of Dollar Tree's largest competitors is Wal-Mart, whose stores have increasingly offered items at steep discounts, at times even $1 and less. In stores and on-line, prices of commonly-purchased Walmart items are already on average 20% less than those on Amazon, according to a study by Kantar Retail. Several items sold in Dollar Tree stores are sold at equal prices in Wal-Mart.