Target Corporation: How does your company make money? (Research Paper Sample)

Target Corporation
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Introduction
One of the goals common to all businesses is to make profits. According to Hòppel (2015), businesses employ different strategies with the main aim of making profits. While some prefer to place high prices on their goods to acquire a lot of profit quickly, others place reasonable prices on their goods which accumulate profit through attracting more consumers. However, the latter method often attracts many consumers and besides acquiring profits, their stock is always in demand. This paper aims at examining Target Corporation to scrutinize its operations overview, revenue composition as well as the relevant information regarding its investors.
Company’s history
George Dayton founded Target Corporation in 1902 (Pluckett, 2007). Target Corporation has had several other names over the years including GoodFellow Dry Goods, Dayton’s Dry Goods Company, the Dayton Company and Dayton- Hudson Corporation. The company has been ranked the second largest discount retailer. Its headquarters are in Minneapolis, Minnesota in the United States. As of 2015, Target Corporation had opened 1805 stores across the United States and employed 347, 000 people. The first target store was opened in 1962 and was modeled as a discount version of the original department stores (Target Corporation, 2015). Over the years, the organization merged with other retailers including J.L Hudson Company and purchased others. With the increase in accumulation of profits, more stores were set up providing a wider range of goods and targeting more consumers.
Current Company News
The company is planning to sell its in-store pharmacies to CVS Health Corporation thereby converting it pharmacies to the CVS brand. This transition was triggered by the acquisition of the Target pharmacies in December. According to the company, the CVS pharmacy will introduce new customers to its leading pharmacy care and at the same time introduce its consumers to various digital tools that will enable them to embrace healthy lifestyles. The company is also planning on embracing digital in all its endeavors.
Leadership
Some of the key employees in the company include Brian C. Cornell as the Chief Executive Officer and Chairman of the Board , Douglas M. Baker as the Lead Independent Director, Cathy R. Smith as the Executive Vice President and Chief Financial Officers and John Mulligan as the Chief Operations Officer (Target Corporation, 2015). The company also has many executive vice presidents each put in charge of department including finance, human resource, purchasing and many others. For instance, Janna Potts acts as the executive vice president, chief stores officer who is mainly responsible for the leadership of the company’s stores across America (Target n.d). Cornell mostly emphasizes on leadership that embraces digital prowess and innovation in the corporate structure of the company with the main aim of making Target the leading company in mobile and e-commerce.
Products and Services
As one of the largest retailers in America, Target key products include household essentials including personal care products, pharmacy products, baby care as well as cleaning and paper products. The company also deals with hardline products such as movies, books, toys, computer software and sporting goods. Accessories and apparel products for instance shoes and jewelries are also available in the company’s stores. Other products include décor and home furnishings. The company also offers services including dining, optical and pharmacy services (Target Corporation, 2015).
Strategies
Target Corporation employs different strategies in its operations. For instance, the company offers high-quality merchandise at discounted prices to help consumers cut expenses. The corporation also works with major brands to develop affordable and exclusive collections for their stores. Additionally, it manufactures its own private label brands for goods including Market Pantry, Archer Farms, Merona and Target Limited Edition, and seeks ideas form the external and internal consultants. The company also arranges licensing deals with innovative designers whose artistic prowess helps the company differentiate itself from other discounting stores. Recently, it has adopted online purchasing. As Pluckett (2007) reveals, Target Corporation offer its employees prescription drugs coverage, dental coverage, telephone assistance, educational loans, home loans and legal services plans.
The company stores have ample spacing, bright lighting and quiet, therefore creating the perfect environment for the customers to shop. They also have sophisticated technology which controls the flow of communication and inventory to ensure the stores always have stock (Pluckett, 2007). Their customer relationship management systems provide real-time data from all of the company’s sales stores therefore helping to improve service. Unlike it competitors, the company offers products which it believes to be trend-forward and more upscale at lower costs as opposed to focusing on low quality goods at low prices.
How Target Corporation make money
Target Corporation makes money by offering quality products and services at discounted prices. It also ensures its stores have all the products that the consumers require. This way, they are able to target and meet the needs of their loyal customers. By helping the consumers cut expenses, the company also ensures that they keep coming back for more. The company sells its products across the United States through stores, online purchases and mobile devices (Rowley 2003). The company has 40 distribution centers which ship supplies directly to target stores with the exception of vendor supplied items like soda and greeting cards. The company have merged and cooperated with other companies over the years in order to increase its profit margins. It engages in healthy competition and strategizes to ensure that the involved parties get profits. Merging enhances problem solving, sharing of ideas and extension of the target population. Target Corporation has also established very good public relations and it distances itself with activities that are harmful to the community. For instance, it does not use any products that have lead and does not sell tobacco. It promotes equality to all its employees and addresses its customers as “guests”, a phenomenon that makes them feel that they are the most important assert of their enterprise.
What Target Corporation sale specifically
Specifically, Target operates food discount stores as well as general merchandise which include expanded food assortment stores, super-target stores and target express. The company also offers fashionable and essentials as well as differentiated merchandise at discounted prices.
Composition of Target Corporation products/services
Target’s products compose of household rudiments, hardline, apparel and accessories, home furnishing and décor, holiday décor products as well as food and pet supplies. On the other hand, its services compose of optical, dining and pharmacy services. The company also has its own brands, and exclusive brands.
Where Target Corporation sells its products/services
The company mainly targets urban format stores such as TargetExpress and CityTarget located in the densely populated areas with the aim of promoting frequent customer visits. These stores are less costly to establish and also incur very low overheads since they are small in size. The company for instance introduced such stores in various locations across the United States to allow target to create a more locally relevant experince for guests in urban areas. The company also sells its products across the United States where they have set up stores including in New York, Annapolis, Los Angeles, Chicago, Seattle, San Diego, Atlanta and Miami (Rowley, 2003).
Major Competitors
Target Corporation’s major competitors include Kmart and Wal-Mart who provide similar products and services. Wal-Mart is a much bigger establishment with more than 2 million employees and over 7500 retail stores. Over the years, Wal-Mart has been a point for debate in connection to labor ethics, healthcare reforms and environmental sustainability. Other major competitors include Home Depot, Best Buy, Amazon and Safeway.
Improved products and services
Target Corporation’s shopping experience is better than that of its competitors due to its conducive environment. The company is also planning to introduce new kids’ home decor products that are gender neutral in an effort to reclaim its style edge. Its restaurants have also started to serve cage-free eggs. It is also investing heavily in enhancing the online shopping experience for its customers and widening exclusive products mix through acquisitions and leveraging social media. The company plans on creating a more guest-centric experience by offering more locally relevant products and taking into accounts factors such as climate, demography and location (Rowley, 2003). It also intends to reassert its cultural leadership and to compose a headquaters team that is mor...