While Amazon Adding a giant fulfillment center to satisfy online orders, Target merges in smaller stores and moves goods.
In October alone, Target opened 18 new locations and joined the 12 it has added since the beginning of the year. In the future, the big-box retailer plans to open up to 40 stores a year, officials said in a statement on Wednesday in the company’s third quarter revenue. It now has 1,897 stores nationwide.
“The key to filling capacity is the business asset itself,” Chief Operating Officer John Mulligan said during the call.
However, the company is moving away from large retail locations that it has traditionally leased. Of the 30 new stores Target opened so far in 2020, all but one were considered small-format. Macy recently announced similar strategy.
“We remain really high in small format stores,” Mulligan added. The Company divides its business into three size categories: 49,999 square feet or less, 50,000 to 169,999 square feet and 170,000 square feet or more.
The announcement of more deals came after the pink third quarter of the retailer.
Operating income was $ 1.9 billion from August to October, nearly doubling $ 1 billion in the same period last year. Total revenue rose to $ 22.6 billion, a year-over-year increase of 21.3 percent. It was another big quarter for Target, whose sales remained in comparison with $ 23 billion from last quarter.
Target, Amazon and Walmart were among the few to benefit from the pandemic as stores remained open and e-commerce business flourished.
Although more than 95 percent of Target’s third-quarter revenue came from its stores, its smaller digital business grew 155 percent year-over-year.