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The 3 Steps of Target's Turnaround Plan

The 3 Steps of Target's Turnaround Plan

MINNEAPOLIS, MN - While Target's expansion effort in Canada has certainly not gone as planned, recent improvement suggests that the retailer has a three pronged strategy to tackle the setbacks and restore the economic success it enjoyed throughout the 2000s. Business Insider notes that the retailer's shares are up 19% so far this year while recent sales have beaten Wall Street estimates. Take a look at how they've done it:


Brian Cornell, Chairman and CEO, Target Corporation

Replacing Gregg Steinhafel with PepsiCo veteran Brian Cornell has proved key for Target, according to Brian Yarbrough, consumer analyst at Edward Jones. Yarbrough explained to Business Insider how Cornell's new retail strategy has been key to the beginning of a Target turnaround.

"Bringing in the new CEO was the first step for Target," Yarbrough said. "He has a creative new perspective and isn't afraid to take risks."

Finding its Product Niche

Recognizing that Target would struggle to compete with rivals such as Wal-Mart and Amazon on consumer staples, Cornell has helped to re-adjust the retailer's focus back on the "cheap chic" home decor and apparel items where it can thrive.

"You aren't going to beat Wal-Mart and Amazon in those categories," Yarbrough explained.

A New Canadian Retail Plan

A new plan for Canada will be key to turning around Target's fortunes. While there is still an abundance of work to be done in this category, Yarbrough shared that the company's early moves to shutter underperforming stores and implement a new profit strategy are reassuring.

"Target Canada's future can only get better," Yarbrough said.

Where will the retailer go next? Only time will tell, but backed by Yarbrough's findings and the success TargetExpress locations have enjoyed in 2014, I would not be one to count Target out. Stay tuned for more.