The time when Target owned a huge retail space is a long time ago.
Target announced the opening of the 100th new small-format store and the completion of the renovation of the 500th of the 1800s already in operation. According to the plan, adopted in 2017, the retailer was actively engaged in opening small retail spaces near subway stations and college campuses. The company also invested a lot of money in the reconstruction of existing large stores, where not only the repair and replacement of floors was carried out, but also the design and product area was updated.
Today, the size of a small Target store can be 1300 sq.m. As a result, the average area of the company's outlets is 3700 sq.m. or one-third of the size of a full-size store. As practice has shown, smaller stores are twice as efficient as larger ones.
The company also announced that it plans to open 30 small-format stores across the country every year. However, there are growth opportunities in cities such as New York, Los Angeles, and Chicago. The company also plans to complete the reconstruction of another 300 stores by 2020.
According to Chief Operating Officer John Mulligan, Target is learning on the go. So, earlier the company preferred to close shops for the time of reconstruction. But the practice has shown that consumers are not particularly concerned about repairs if it is carried out in certain areas of the store. Thus, Target managed to halve the "failure in sales," which was inevitable during a complete reconstruction, which took about three months.
Recently, the company published a financial report, which significantly exceeded the expectations of analysts. While the income of other retailers is falling, Target showed a growth in sales by 2.4%, while online sales grew by 34%. Analysts believe that Target today is more attractive to consumers because it serves as a reliable and universal place to buy necessities. Also, Target tries to improve the supply chain by opening new stores and remodeling old ones. The steady development has led to an increase in the company's shares, the price of which has increased by 55% this year.
Also, another news was Target's cooperation with Disney. According to the agreement, the Target stores will have areas for Disney products. Their opening will begin on October 4 this year and will initially cover 25 stores throughout the U.S. Next year such zones will appear in 40 more stores. Sales of Disney products will start soon in the online store Target. It is expected that this step will attract additional customers.
At the same time, in 2021, Target will open a retail outlet next to the Walt Disney World Resort amusement park in Orlando, Florida.