Target will hold a grand opening Sunday, Oct. 25 for six new Southern California stores, bringing the retailer’s Southland total to 114 locations.
One of the stores, on West Sunset Boulevard in Los Angeles, is 150,000 square feet, but the rest are small-format locations that average around 30,000 square feet. They will collectively employ more than 600 workers.
That will bump the Minneapolis-based retailer’s local workforce to nearly 21,000, and it will boost its nationwide store count to nearly 1,900.
John Mulligan, Target’s chief operating officer, explained the company’s forward momentum in a second-quart earnings call with investors.
“After opening three new store locations in March, we took a pause in our new store projects as uncertainty from the pandemic emerged,” he said. “Since then, we have been ramping up our new store construction activity, and we are now on track to open up to 27 more stores this year.”
Target’s new Southern California stores:
- 5500 W. Sunset Blvd., Los Angeles
- 8900 S. Sepulveda Blvd., Los Angeles
- 1833A La Cienega Blvd., Los Angeles
- 43 Peninsula Center, Rolling Hills Estates
- 1610 Wilshire Blvd., Santa Monica
- 31874 Del Obispo St., San Juan Capistrano
Small-format stores offer men’s and women’s apparel and accessories, home decor, groceries, health and beauty items and tech accessories — but in a downsized format.
“You can get in and out of them more easily and they have a curated assortment of merchandise,” said Bob Phibbs, CEO of The Retail Doctor, a NY-based retail consulting firm.
The “big story,” Phibbs said, is the growing disparity between big-box retailers and smaller stores.
“The big guys like Target, Walmart and Amazon will get bigger at the expense of the smaller guys,” he said. “The big ones are all flush with cash and have made substantial investments in people and processes, so when the lockdown happened they were ready.”
Mulligan said Target will likely add 35 to 40 small-format stores a year in the coming years. The six new Southern California stores held a soft opening Wednesday in preparation for Sunday’s grand opening.
Thriving amid the pandemic
Many businesses have taken a heavy hit during the COVID-19 pandemic, but big-box retailers like Walmart and Target were deemed essential businesses and have seen their earnings rise as shoppers flocked to their stores for toilet paper, sanitizer, food and other essentials.
Target generated $23 billion in revenue for the second quarter of 2020, a 24.7% increase over the same period last year, and online sales grew by 195%, the company reported. Target posted operating income of $2.3 billion, a 78% year-over-year increase.
“The majority of our digital demand is driven by items that are already available in our stores, which positions us to efficiently rely on those locations to fulfill the demand,” CEO Brian Cornell said in the second-quarter earnings call. “We’re sharing second-quarter results that are, by virtually any measure, exceptional.”
Cornell said Target’s most rapid growth has been in store pickups for same-day online orders.
The company’s Drive Up and Shipt services, he said, offer “speed, reliability, convenience and value to our guests.”
“They are digital capabilities enhanced by human interaction, even though they’re contactless,” he said.
Target recently boosted its starting hourly wage to $15 an hour, and the company has also given recognition bonuses to its hourly frontline store and distribution center workers during the COVID-19 pandemic.
Source: Orange County Register
Be First to Comment