Causes Of Target's Growth

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Over the years Target has established itself as the second largest discount store in America. Falling behind Walmart, Target has experienced periods of strong growth but has recently encountered problems that have caused concern with those within the organization as well as external analysts. One of the biggest problems Target is facing currently is generating consistent customer traffic into its stores as many of their major departments are continuously loosing money and causing customers seek out other product alternatives. A major contributor to this problem is that it is spreading itself thin by offering too much without establishing a competitive advantage and not firmly establishing itself in denser city locations. Just recently Target…show more content…
Examples such as Apple have a significant impact on Targets electronic department, which showcased losses this past quarter with apple sales dropping 20%. A lot of what is sold and not sold has to do with particular product launches and if there are any defects of any given product. This can create major sales problems and can cause negative financial waves. Alternatively, products in high demand, and highly anticipated product releases can provide a positive increase in overall sales for each independent sector. Recently Target experienced losses in many of their stores across Canada, prompting the CEO to close all of them. This has now left Target dependent solely on the macroeconomic situation within the United States. Target is located in forty-seven different states across the United States with its highest presence in California, Florida, Texas, Minnesota, and Illinois. This can be a concern for Target because it cannot be helped by any international locations if the domestic economy takes a negative turn, resulting in significant drops in production in its…show more content…
But if it is going to improve on its recent losses, Target needs to start moving into more developed areas with stores that are suited to providing its customers with the products they want and need, but not be overwhelming for customers. Some of the major problems target will face with this alternative will be costs of development. Land that is closer to larger populations is going to cost more as well as the increase in permits and the cost of contractors to create the right store for the given environment. Another issue Target could face would be choosing which products they should sell in these new stores, because of the limited developmental space available, the products chosen will have to be limited as well. But by moving to more populated areas Target will be able to reach more people and begin competing with the local stores that are taking away its business. Additionally, closer locations will provide additional convenience for its
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