Turnaround of Target: Will it Bring Back Lost Momentum?




Case Details Case Introduction 1 Case Introduction 2 Case Excerpts

Abstract

This case discusses the turnaround strategies adopted by Minneapolis-based discount retailer, Target Corporation (Target), to revive its business in the US and revamp its operations in Canada. The retailer was known for its cheap-chic image of offering affordable but stylish fashion and home goods that had won the hearts and wallets of millions of shoppers over the past three decades. But since 2013, Target had been having trouble connecting with consumers.

American shopping habits were going through a profound change, as people shopped more online and were looking for huge bargains as they struggled to cope with stagnant wages and higher taxes. This resulted in a persistent drop in traffic at Target’s 1,795 US stores. While Target was grappling with issues in its US stores, it also had to deal with its not so successful international expansion into Canada. In March 2013, Target forayed into the Canadian retail market by launching 124 stores. The Canadian launch had been rocky since it was plagued by supply chain issues. Moreover, customers were unhappy with the merchandise selection and the fact that the products at Target Canada were priced higher than those at other retailers in Canada.

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Issues

The case is structured to achieve the following teaching objectives:

  • Examine some of the reasons for the problems faced by Target in the US.
  • Analyze the turnaround strategies adopted by Cornell to revive Target’s operations in the US.
  • Examine the challenges faced by Target in revamping its operations in Canada and attracting price conscious consumers to its stores.
  • Explore strategies that Cornell could adopt in these difficult times.

Contents
Introduction
About Target
The Problems
The Turnaround
Results
Looking Ahead
Exhibit

Keywords

Target Corporation, Turn around, Fashion retailer, Tar-zhay strategy, International expansion, Supply chain, Merchandise selection, Brand recognition, Pricing, Inventory management, E-commerce, Store layout, Store expansion, Digital strategy, Point-of-sales, Customer traffic, Neiman Marcus group, Wal-Mart stores inc., Zellers, Gregg Steinhafel, Brian Cornell

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