Outline Of Recommendation For Change

Target Canada is the company’s first international expansion. However, Target’s expansion was not successful, as the company had initially planned for. Therefore, the company will be closing 133 Target Canada stores across the country and lay off approximately 17,600 employees. According to Target’s CEO Brian Cornell, he stated “After a thorough review of our Canadian performance and careful consideration of the implications of all options, we were unable to find a realistic scenario that would get Target Canada to profitability until at least 2021.” Moreover, problems occurred immediately when Target opened up over hundred stores in the first year of its Canadian Expansion. For example, customers complained about the lack of basic goods, prices being too high, and the unavailability of U.S. brands in the stores. It was the start of Target accumulating losses as high as a billion dollars a year. In addition, there was also increasing competition with Wal-Mart being the biggest retailer in Canada. The already intimidating rival lowered its prices in order to fend off Target. Furthermore, Target Corporation’s cash costs to discontinue Canadian operations are expected to be $500 million to $600 million, most of which will occur in the Company’s 2015 fiscal year or later. The Company has sufficient resources to fund these expected costs, including cash on hand and ongoing cash generation by

With the down turn in the economy, many consumers have turned to Dollar General and Dollar stores; this has caused a decrease in Target’s revenue. Another threat is Wal-Mart and their ability to offer lower prices on their products compared to Target which makes them the low cost leader. (ehow.com)

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).

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.

The Target Corporation is a general merchandise retailer that opened up in in 1962 under the parent company of Dayton Corporation. This parent company was renamed the Target Corporation in 2000 and are based out of Minneapolis. There are over 1,800 Target stores throughout the United States which includes Targets and Super Targets. In 2005 Target began expansion in India and in 2011 to Canada however this expansion into Canada did not fare well and all Target Canada stores were closed by 2015. According to Forbes in 2005 they we ranked amongst the highest cash-giving companies in America with 2.1% given and they donate about 5% of its pre-tax operating profit. In 2010 Target was ranked number 22 by Fortune magazine’s World's Most Admired Companies.

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.

Target has a corporate social responsibility plan to show the legacy of giving and service. Rothaermel (2014) explains that Target embraces social programs, such as, promoting minorities and minority women into the supply chain. Target is fostering equality in society; this begins by creating a diverse workforce. Target is engaging the community to strengthen relationships and teach ethical treatment to others (Target, 2016). Rothaermel (2014) discusses corporate citizenship, where an organization philanthropic responsibilities are evident thorough ethical practices and giving back to society. Target encourages their employees to volunteer in local community programs. Target is interested in the community stakeholders and is committed to supporting communities by giving five percent of its profits, which has added up to more than $4 million each week (Target, 2016).

I choose to talk about the Target Corporation, because it is a franchise where consumers constantly shop at for their grocery, home décor, and bathroom essentials. The Target brand is in the general merchandise retailing industry and was first established in 1962. Target’s mission statement states: “Our mission is to make Target your preferred shopping destination in all channels by delivering outstanding value, continuous innovation and exceptional guest experiences by consistently fulfilling our Expect More. Pay Less. ® brand promise” (Target Corp., n.d.). The company’s mission statement implies that Target is a store where consumers can get products for a reasonable price. Target is performing well despite of their security breach problem a couple of years ago. It does not follow Pfeffer’s principles to the key, but it is a high performing organization. Their goal is to provide affordable prices at their different full-service department stores. Target has 1,556 stores and is the fourth largest retailer in America. It ranks as the second discount retailer in America only Wal-Mart Stores, Inc. stands in their way (Target Corp., n.d.). In 2011 Target acquired the Zellers retail chain, at a cost of $1.8 billion dollars to its international expansion (Target Corp., n.d.).

To accomplish the aforementioned vision statement, Target has come up with many different ways to fulfill their goals. Target has been trying to delighting their customers for years. They are constantly looking for better prices to fulfill their credo of, "Expect More. Pay Less."

If Target were forced to consider re-organization and bankruptcy strategies the changes that may occur to its finance policy and capital structure could be devastating. Target is currently the number two retailer behind Wal-Mart, but would change with any sort of re-organization or bankruptcy. Target would have to liquidate its inventory in order to repay its debt. It would also have to close plants and cut employees to reduce overall costs. Target would also have to sell many of its assets and plants around the

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 Corporation is one of the largest retail companies in the U.S that employs many diverse products and technique as part of its operations. Target Corporation 's overall diversification

Do you think Target is balancing its brand promise of “Expect More. Pay Less.”or is one goal overshadowing the other?

CSR is the concept that businesses should balance profit-making with activities that benefit society, as Bruce Dayton believed “businesses should act in the best interest of society” (Target, 2015). Accordingly, Target’s commitment is to design tomorrow’s Target through our value chain, building community and creating a great workplace. As such, its 5 core beliefs: innovation, leadership, growth, inclusivity, and community influence its ongoing commitment to CSR. Furthermore, they achieve this by concentrating on:

Like Wal-Mart’s Express stores, Target also plans on opening new CityTarget stores. Since Wal-Mart is Target’s biggest competitor by planning on opening CityTarget stores, Target is following the Strategic Group ideology which is also discussed in chapter 9 “Dealing with Competition”.