Looking At Targets Porter Analysis

1535 WordsMay 3, 20177 Pages
Looking at Targets Porter Analysis, internal rivalry is one of the major and significant threat to their profitability and the future development of their industry. Competing in the market with big competitor like Walmart with a superior means to gain large market shares, Target is finding it very difficult to bring their prices down to keep up with Wal-Mart’s ability to cut input and supply chain costs. Looking at Target contribution into this retail industry, they had succeeded in surviving in the discount retailing sector compared to K-mart among other competitors. Target had been so impressive in their market profit margin because they have been growing extensively and maintaining relatively high profit margins within the industry.…show more content…
Also, due to higher traffic between larger and smaller cities it will be costly to expand into cities because people or customers residing in the city would likely welcome the presence of Target within their suburb but comparing the cost of living in the cities to the suburban areas, cost in cities is higher than that of the suburban areas, so therefore Target gain more price advantage to other competitors like Walmart in that area but one major issues with Target in urban areas is Transportation. Their customers will have difficulty transporting themselves down to shop at Target. But if majority of the residents are foot traffic then customers may be having an opposite thought to buy large quantities of products because it would be difficult for them to carry it home. Since shopping at Target is often characterized by a “loading up” of the cart, a store in this type of location may not succeed. However, this potential problem can be avoided. Urban shoppers need a lower price product because they regularly purchase basic products such as Tide laundry detergent, groceries, cleaning supplies, and so on. If Target offers these products at a lower price, customers will be forced to shop more at Target. Because Target is a one-stop shopping center, the convenience of shopping at a Target a bit farther away may be more attractive to a customer than shopping at several different small shops
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