In a move that gave many retail watchers (myself included) pause, Tractor Supply Company just announced that it is hatching some serious expansion plans. As part of its Life Out Here 2030 strategy, the company plans to open 90 new namesake stores and approximately 10 new Petsense by Tractor Supply locations in 2025 alone.

But the real story here goes far beyond the growth in store numbers.

There are three compelling reasons why Tractor Supply deserves attention as it could be the most intriguing retail growth story of the next decade.

#1 – The extent of Tractor Supply’s store presence

Tractor Supply increased its long-term store count goal to 3,200 locations, up from its previous goal of 3,000 and from approximately 2,200 stores currently in 49 states. At that level, Tractor Supply would dwarf Target and approach Walmart’s size.

According to its website, Walmart currently operates 3,559 Walmart Supercenters, while Target, in comparison, only operates 1,963 stores in the United States. The expansion plan thus puts them in the air.

Very few retailers can boast such national presence and scale (more on that later).

#2 – Pet category expansion

Expanding the pet category through Tractor Supply’s own Petsense banner also represents a smart strategic move. By developing a dedicated pet retail concept alongside its core business, Tractor Supply is positioning itself to capture market share in one of the most resilient and growing segments of retail.

As stated on Petsense’s website, Petsense is “focused on meeting the needs of pet owners, particularly in small and medium-sized communities.” Or to put it another way, Tractor Supply wants to be a more accessible and desirable option to Petco and Petsmart for rural communities, much like it is now compared to Walmart and Target.

According to the American Pet Products Association (also known as APPA), U.S. pet owners spent $143 billion on their pets in 2023.

Last time I checked, that’s a whole lot of kibble or cheddar if that’s more your dog’s taste.

#3 – With size comes retail media

I’ve hinted at it before, but the most intriguing aspect of these expansion plans is the potential of retail media. With a nationwide presence of this magnitude, Tractor Supply’s media presence would be equal to or better than any other retailer out there. There are only a handful of retailers that can offer true nationwide reach to advertising partners, and Tractor Supply is preparing to join this exclusive club.

Walmart, for example, said last quarter that nearly a third of its $6.7 billion in total operating income now comes from advertising sales. By comparison, Tractor Supply’s full-year 2023 total operating income was approximately $1.48 billion.

This means that if Tractor Supply can maintain its store count on par with Walmart and invest in strengthening its digital position through great online services and a marketplace experience on par with Walmart, then Tractor Supply will have significant latent profit just waiting to be discovered.

And don’t forget that unlike most retail CEOs, Hal Lawton’s background is heavily digital. Prior to joining Tractor Supply, he held two digital leadership positions at Macy’s and senior vice president at eBay. So Lawton clearly has what it takes to take advantage of retail media opportunities.

The numbers tell the real story

But don’t just take this expert’s word for it either. The numbers tell the real story.

In addition to its expansion plans, Tractor Supply has also increased its total addressable market size to approximately $225 billion, up from its previous target of $180 billion. Combine that with corresponding forecast net sales growth of 6-8%, comparable store sales growth of 3-5%, and expected earnings per share growth of 8-11%, and the story here goes well beyond just expanding store count – they’re also planning to be profitable to expand.

Tractor Supply is currently ranked No. 33 on the NRF list of largest U.S. retailers by annual sales, generating nearly $15 billion per year. If Tractor Supply hits even the low end of its projections by 2030, that number could rise to just under $22 billion. Based on the current NRF list, that would mean Tractor Supply would become one of the top 25 largest retailers in the United States in just five short years.

The conclusion

While many still think of Tractor Supply as just a “rural” retailer, Tractor Supply’s expansion strategy, along with its digital expertise and diverse growth vectors, suggests that the industry could be watching the emergence of the next big player in retail.

The retail industry loves chasing the next shiny object, but sometimes the most compelling stories come from unexpected places. As urban retailers struggle with oversaturation and fierce competition, Tractor Supply has identified a clear path to growth.

The next chapter of retail may not be written in Silicon Valley or on Fifth Avenue – it could simply be written by those who serve the “life out here” that millions of Americans live every day.