Target Strategic Outline

One of Target’s strengths is that it’s one of the largest retail outlets. Target is a one stop shop for its consumers. Target

Target Corporation (NYSE:TGT) is the leading large-format general merchandise and discount retailer in the U.S., challenging Wal-Mart in electronics, toys and apparel while also seeking to differentiate with higher-end fashions and products for an upscale audience. As of the close of their latest fiscal year (FY2011), Target operated approximately 1,760 stores encompassing 233,000 square feet in 49 states and the District of Columbia. The company is divided into the retail and credit card divisions and moves the majority of its products through a highly integrated network of 37 different distribution centers, which include four food distribution centers. Target is one of the most well-entrenched large format retailers in the U.S., has the ability to manage their pricing strategies at a level of accuracy and precision that is comparable to Wal-Mart (Henderson, 2001). Unlike Wal-Mart, Target concentrates on a value-based message that concentrates on quality and price differentiation to sustain their gross margins while Wal-Mart concentrates on supply chain efficiency and a continual reduction of supplier and transaction costs (Krishnamurthi, 2001).

The aim of this paper is to highlight the strategic position of the company with an overview of its internal and external environment. The study of its strategy, design and other forces, one can easily gauge why and how target has managed to become the retail giant it is today.

Target Corporation’s 2007 annual report to stockholders keys in on a few main points. The first main concern was that overall financial performance in 2007 fell short of expectations largely due to slowing sales and earnings growth in the second half of the year. But, despite the slowing economy, Target remained focused on continual investment and growth in the business. Over 100 new stores, including 33 SuperTarget® stores were opened in 2007. Investments were made in technology and

After the recession, Target’s value proposition shifted to simply offer affordable options in a wide array of product areas. However, now with better economic conditions and without the ability to offer lower prices than its affordable retail competitors, such as Walmart, and in order to stay relevant and refresh the company, Target needs to reposition itself as the high-quality concept and style-oriented retail store it was once known for.

“Target Corporation’s efficient marketing, multi-channel strategy, product innovation, compelling pricing strategy and new merchandise assortments, should help drive comparable-store sales and operating margins in the long term. We expect the company to gain market share, and believe that more focus on consumable items should boost sales and earnings in a sluggish consumer environment. (Zacks 1)” Zacks’ investment research analysis of the Target stock going forward indicates that Target focusing on consumable items, such as the food section in a Super-Target, could help benefit Target financially.

Target Corporation is known worldwide as a large retail chain that brings in millions of dollars each fiscal year. The ability to remain competitive in a saturated industry could prove difficult to some retailers, but Target remains one of the leaders in the retail market. With success comes risk. Target Corporation competes against online retailers as well as “big box” stores to remain competitive.

This report examines Target Corporation’s performance in a detailed strategic audit. The audit includes an external, internal and strategic analysis as well as a recommended course of action. The findings of the audit recommend a robust on-line/mobile presence to complement in-store sales, and to increase future earnings to remain competitive by building upon physical assets, brand value and logistical capabilities.

In my personal opinion, Target should continue to develop a specific portfolio that is specifically targeted to its customer’s needs and likes, while focusing on maintaining the same product quality and variety for each store brand. Through its marketing strategy, the retailer has to assure the consumer they are purchasing the same quality product as if they were buying a national brand at a more affordable price; which at the end is more convenient for the consumer and does not have to sacrifice quality. Target should also expand to the South and Northeast where there are still plenty of attractive locations with no Target presence. This will attract more customers and consequently strengthen its store brands.

Target’s sales have been strong for the past three years. 2016 did see a drop in their sales but looking at the cost of goods it can be seen that they are also keeping their supplier costs down. Target offers competitive pricing and will price match for their customers. This helps both Target and the consumer since Target keeps a happy customer and one that continues to come back and the customer sees that Target care about their customers.

Target offers a friendlier atmosphere, whereas with Walmart has more of a resentment and hostility present when you walk through the doors. For example, when I shop at Target there is always someone to greet me as soon as I work through the door, and when I need assistance in any department there is always a sales person there to help assist me, but at Walmart it’s not that simple. I would have to hunt for someone in order to get assist with whatever I need help with. Going back to what I’ve learned in week 1 of the course, as a business grows so does its customers which will have an increase of sales on products within the business. Target has a good relationship with their customers which has built them a high level of brand loyalty. Even

As the second largest retailer in the U.S., Target provides customers with high quality and low priced products. Since its inception, Target has been able to reach U.S. consumers successfully, with stores in every state except Vermont. Ninety-seven percent of Americans are aware of the Bulls eye logo. In addition, Target’s revenue increases every year with the 2016 revenue totaling $67.390 billion.1 The successfulness of Target can be appointed to three strengths: product value, appearance of stores

Target had many competitors but the top two competitors that were a thret to target was Walmart and Costco. Costco tried to attract the same customers as target does but Costco used a membership fee. So that maid one big difference between both of them. Walmart is very similar to target and operate similar too but Walmart is the dominate company in the industry and operate around the world. Target had a capital expenditure approval process and they are made from a team of top executives that meet and review requests that are over $100,000. This time there getting together and discus 5 projects that represented almost 200 million in proposed capital investments. They know that any decision they made can impact the short term and long term profitability

To understand what Targets distribution strategy is, we must know how many levels they have in their distribution channel and what marketing system they are using. Target looks to be in a vertical marketing system that is more administered. It seems that Target holds the power in the relationship with the companies that it does business with and has invited them to work with them in the improvement process for their distribution dilemmas (et al.) As of 2017 Target’s North American distribution infrastructure is made up of 41 centers. They consist of five different types of facilities. Regional general merchandise distribution centers, Import redistribution centers, perishables food distribution centers e-commerce fulfillment centers, and the

Target knows their customers want merchandise on the shelves. Target is always working on sourcing and adjusting their supply chain to make sure production, quality, capacity, pricing, and