Target Corporation is an American-based merchandise retailer, operating more than 1,800 stores across America, including digital channels in selling products (D&B Business Directory). Target Corporation deals in a wide range of products like food supplies, dry grocery, and dairy products. Other products include electronics, apparel, and accessories (Reuters; Target). Target utilizes creative partnerships and periodic exclusive designs to sell its products and generate huge revenues. Target Inc. has an earned a place as the eighth-best retail company in America. Its competitors include Walmart, Costco, and Amazon (Reuters). Target's digital channel "Target.com" is an online platform that enables customers to access various products available in its stores. The company's brands include Room Essentials, Market Pantry, Art Class, Merona, and Pillowfort (Reuters). On January 31, 2021, Target's financial data recorded annual revenue of $93.56 billion courtesy of its high product sales (Reuters). Besides, the company operated 1,802 stores across America, of which it owned 1,535 stores, leased 107 stores, and owned 160 buildings on leased land (D&B Business Directory). These developments saw its annual revenues surge by 51% between 2017 to 2021 (D&B Business Directory). Target has built a stable supply chain strategy to source and distribute products efficiently within its market niche. Its supply chain strategy has had a positive impact on its business by allowing the company to deliver commodities at the right time, train employees, improve the visibility of stores across the United States, build new stores to obtain new customers, create new digital capabilities to enhance customers' purchasing experience, and debut new merchandise to improve the brand portfolio (D&B Business Directory). Target acts as a role model to other companies through its outstanding supply chain strategy. Therefore, Target's supply chain management encompasses procurement, order processing management and delivery options, inventory management, product and service specifications, and logistics. Besides, the following core values reflect on Target's supply chain management: Excellence, personal development, integrity, responsible stewardship, and community.
Target's Supply Chain Management
Supply chain management (SCM) refers to managing the movement of products and services, including the processes of transforming raw materials into finished products (Bozarth & Handfield, 2016). A supply chain management monitors and ensures that supply chain activities attain effectiveness and efficiency; hence, allowing organizations to maximize customer value and achieve competitive market advantage (Bozarth & Handfield, 2016; Lysons & Farrington, 2016). The following are supply chain activities: sourcing, product development, production, and logistics (Kain & Verma, 2018). Target focuses on various products and services; hence, it requires effective supply chain management to achieve business success. Therefore, Target's supply chain management goals are to maximize efficiency and visibility and reduce operations costs.
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Procurement
Procurement refers to the steps undertaken by an organization to identify and obtain goods and services from an external source (Lysons & Farrington, 2016). Target takes procurement seriously to accomplish the market demand for its products and services. Target's Chief Operating Officer oversees the company's global supply chain, ensuring that products are obtained from genuine external sources (Target Leadership). The Chief Operating Officer discusses with Target's internal consultants to identify and obtain products from top quality sources (Target Leadership). For example, Target has built a rapport with designers like Chip and Joanna Gaines and Magnolia collection to obtain assortments like furniture, carpets, flower vases, and home decorations (Target). Target also acquires food and beverage products from Tyson Foods, Dairy Farmers of America, JBS, and Cargill, major food industries in America (Thomas). Target Corporation receives household and kitchen essentials from Homer Laughlin Company, Nordic Ware Company, and Corelle Company. The above companies manufacture plates, mugs, cooking pans, and stainless-steel cookware sold in Target's stores and digital platforms. Target has also built a business rapport with toy companies like Lego, Barbie, and Manhattan Toy, which provide a wide range of toys sold in stores (Target). Target obtains electronic products from Maytag, LG, Silo Digital, Dell, HP, and Apple (Target). These companies offer Target goods like refrigerators, televisions, toasters, washing machines, computers, and smartphones. Additionally, the company obtains sports and outdoor equipment from Nike, Cosworth LLC, and Johnson and Johnson (Target). It has also partnered with beauty companies like Mana Products, Inc. to acquire personal care and beauty products. The above companies hold substantial market shares in their respective industries; hence, they qualify to be credible sources for Target's wide range of products. Therefore, these companies have created an effective rapport with Target, supplying them with quality products for their customers.
The following executives oversee Target's procurement services: Chief Operating Officer, Chief Merchandising Officer, Chief Legal and Risk Officer, and the Chief Food and Beverage Officer (Target Leadership). These executives play a functional role in analyzing data and identifying new companies to help them acquire products and services that benefit customers. Besides, these executives engage with each other to apply insights that create value across the company's supply chain. The Chief Food and Beverage Officer identify and communicate with significant food and beverage companies across America to supply Target's stores with food products (Target Leadership). This has improved Target's food and beverage business since 2017, contributing to huge revenues. Therefore, procurement is a vital sector in Target's supply chain management, allowing it to acquire products and services from quality sources.
Order Processing Management and Delivery Options
Order processing management refer to tracking customer orders to the point of delivery (Uhl et al., 2017). Order processing management ensure the reliability and accuracy of products to boost customer satisfaction. A typical order processing management in any company involve picking, sorting, tracking, and shipping products (Uhl et al., 2017). However, Target utilizes order processing management to deliver its brand promises and optimize the supply chain network (Britt, 2020). Order processing management also help leverage cutting-edge logistics technologies and supply products and services efficiently and cost-effectively (Britt, 2020). Target's order processing management occur with the help of effective leadership and management. The company's Chief Financial Officer coordinates with other executives like the Chief Food and Beverage Officer, Chief Human Resources Officer, Chief Merchandising Officer, and the Chief Stores Officer to prepare, plan, and deliver products to guests or consumers (Target Leadership). Order processing management in Target occurs in every stage of the supply chain management like finance, merchandising, distribution, transportation, and stores; hence, it requires input from every executive. Target analyzes various initiatives and strategies to boost order processing management to benefits the end customers (Britt, 2020). The company's leadership plays a significant role in streamlining alternative solutions and opportunities through the internal systems and organizational infrastructure to bolster order processing management.
Target builds value delivery options by strengthening its online websites to deliver value to customers (Cassidy, 2020). Besides, the company has created partnerships with other online websites to enhance order processing management. Target's executives track customer orders with the help of its online website, "Target.com." The online website has been vital during the pandemic by reducing physical interaction between customers. Also, the online website provides quick services to customers since the company delivers products offered based on consumers' location. This has enabled the company to bolster its accuracy and performance, at the same time enhancing profitability across the supply chain. Target's order processing management promote excellence within the supply chain, ensuring that the business stays committed to its vision, goals, and mission to benefit customers. Besides, Target has over 1,800 stores and more than 300,000 employees that track customers' orders through daily interactions (Cassidy, 2020). Target's employees keep records of every customer order and present them to the financial executive in respective stores. Financial executives of every store communicate the orders to the Chief Stores Officer, who engages the Chief Merchandising Officer and other executives. These relations ensure the quality and safety of customer orders before delivery. Hence, order processing management ensure that consumers acquire products in the right quality and time, promoting quality performance and accuracy across the supply chain.
Logistics Management
Logistics management monitors the movement and storage of raw materials and finished products within an organization's marketing channels; hence, maximizing safety and profitability (Kain & Verma, 2018). Logistics management ensures that organizations plan, implement, and control the flow and storage of products and services to benefit consumers (Kain & Verma, 2018). Target's executives, such as the Chief External Engagement Officer and the Chief Operating Officer, coordinate with other officials to re-calculate and strategize alternatives that enhance logistics and deliver low-cost products across America (Wilson, 2019). Target utilizes road, water, and air transportation to move products to over 1,800 stores across America (Cosgrove, 2020). Target faces challenges with high fuel expenses during the transportation of products. However, the company has opted to use cheap forms of transportation like water, railroad, and trans-load to minimize high fuel expenses (Wilson, 2019). This ensures that the company obtains minimal accrued expenses to maximize annual revenues and profits.
Target also utilizes import distribution centers to obtain imported merchandise. The company's import distribution centers are located on the East and West coasts, especially in Long Beach, California (Cosgrove, 2020). Target's Chief Operating Officer organizes the transportation of imported products using truck or rail transport destined for regional distribution centers (Cosgrove, 2020). The company has hired outside consultants NTE to replace manual operations; thus, improving distribution systems (Britt, 2020). Target has also planned for inland ports to be accessed by railroads due to the ever-growing fuel prices. Railroads deliver containers carrying merchandise and other products to an inland import in DC. Thus, Target approves this transportation strategy to reduce fuel costs across the supply chain.
Target utilizes technology during transportation to enhance the safety of merchandise and other products. For instance, the company has adopted sophisticated GPS devices in every truck that distributes products within the Brazilian marketplace (Cosgrove, 2020). The company has programmed GPS devices to send real-time weather updates and humidity levels during transportation (Cosgrove, 2020). This enables the company to monitor the quality and safety of transported merchandise. Besides, the company has developed refrigeration systems to maintain the quality of products before delivery (Cosgrove, 2020). For instance, Target has adopted refrigeration systems to preserve perishable food products to fit the Brazilian climate. Also, Target owns various warehouse locations across America and Brazil to enhance the safety and quality of products (Wilson, 2019). However, Target's logistics management in Brazil experiences constant power shortages that impact business and communication. Nonetheless, the company has adopted an effective cloud system to secure communication between every stage of the supply chain system (Wilson, 2019). In principle, Target has built an effective logistics management to support merchandise distribution to distribution centers in different geographical locations across America and Brazil.
Inventory Management
Inventory management is the process of tracking goods across the supply chain by controlling, overseeing purchases, and monitoring stored products using inventories (Wild, 2017). Target's inventory management deals with finished products ready for sale. Inventory management enables the supply chain to balance, ensuring the company has the appropriate stock quantity at the right time and location to promote consumer purchases. Target's inventory management utilizes sophisticated technology and IT systems to track and monitor products across its 1,800 stores in America (Cosgrove, 2020). The company has partnered with Microsoft to boost its inventory management. Microsoft has created a virtual storage cloud that manages Target's cash registers from every store's sales information (Microsoft). This has enabled Target's inventory managers to bolster marketing and monitor consumer demands (Moon, 2018). Microsoft's partnership in inventory management has created the electronic logistical system that streamlines supply chain activities within Target (Microsoft). Target's inventory management undergoes in-stock improvements through communicating and tracking systems to enhance profitability and business efficiency (Cosgrove, 2020). Besides, Target owns various warehouse locations across America to track and monitor products easily. This is different in other retail companies that rent warehouse locations, making it challenging to manage products appropriately. Thus, effective inventory management has triggered Target's business success, ensuring that it monitors its merchandise to serve consumers.
Target's inventory management involves two mechanisms. Firstly, the Chief Operating Officer orders merchants to deliver products in various distribution locations within America (Wilson, 2019). The merchants manage distribution and ensure that products arrive in the required quality and quantity at the right time. Secondly, Target's Chief Operating Officer orders the merchants to monitor their supply chain and manage delivered merchandise (Wilson, 2019). Target's inventory management ensures accuracy within the supply chain (Wilson, 2019). Thus, inventory management upholds the core value of integrity and honesty, highly needed in any business activity. Inventory management systems help the company to reduce risks associated with overselling merchandise. It ensures that Target sells a specific number of products through its online platforms, enhancing market control. Target's inventory management reduces risks associated with stock-outs and excess stocks; hence, maintaining balance across its supply chain (Jack & Powers, 2015; Wilson, 2019). Target's inventory management promotes visibility and boosts product traceability (Jack & Powers, 2015; Wilson, 2019). This assists the Chief Operating Officer, and other executives avoid challenges within the supply chain. Finally, Target's inventory management improves business negotiations with other companies, enabling it to engage in profitable business decisions (Jack & Powers, 2015; Wilson, 2019). The partnership between Target and Microsoft in inventory management has enhanced data-driven business decisions that promote profitability. Inventory management is a crucial element of Target's supply chain management, ensuring the tracking of merchandise and monitoring warehouse storage and consumer purchases.
Product and Service Specifications
Product and service specification refers to an organization's ability to produce products with particular features or functionality different from competitors. Successful organizations major in product and service specifications to attain a competitive market edge. This enables them to acquire more consumers and compete favorably. Target focuses on product and service specification by creating a differentiated approach, allowing it to provide products and services according to its consumers' needs and wants (Britt, 2020). This approach helps it to compete with direct competitors like Walmart and Costco. Target has differentiated its merchandise stores into various sections, offering customers the utmost shopping experience. For example, a single store has a pharmacy, a food avenue restaurant, a grocery, and a small shopping center. This enables consumers to acquire different products in one area, improving the shopping experience. Besides, Target has an online website, "Target.com," that supports consumer purchases from any location within America. The online website shows exclusive deals alongside different brands and designers, allowing consumers to enjoy shopping. The website is user-friendly and offers customers more gifts than other retailing companies across America. Target stores are constructed with a highly contemporary design, and their employees are knowledgeable, which attracts most consumers (Britt, 2020). Finally, Target's products and services attract young, educated, and fashion-forward consumers, enabling it to achieve a competitive market edge (Britt, 2020). Target improves its products and services to appeal to young and educated individuals since they are among the majority of American customers (Moon, 2018). Therefore, product and service specifications enable Target to acquire new guests or consumers, enabling it to compete with direct competitors.
Organizational Core Values
Organizational core values are fundamental principles or beliefs that shape their behaviors and help employees recognize right and wrong (Derwik et al., 2016). Core value allows organizations to achieve goals and objectives by following the right path. Target's supply chain management portrays the following core value: integrity, respect, responsible stewardship, and excellence. Firstly, Target's procurement strategies promote excellence in business by ensuring that products are acquired from a genuine source to boost customer satisfaction (Derwik et al., 2016; Moon, 2018). Its procurement strategies ensure that different executives coordinate to identify credible external sources to obtain products that benefit consumers. Secondly, Target's logistics management promotes excellence, integrity, and responsible stewardship across the supply chain (Derwik et al., 2016). The logistics management ensures the flow of products from an external source to distributors in various locations, promoting business excellence (Moon, 2018). Besides, it organizes and controls the movement of products; hence, promoting integrity. Thirdly, inventory management fosters excellence and integrity within Target's business. Inventory management monitors and controls the overall supply chain system by ensuring the safety and quality of merchandise; thus, business excellence and integrity (Derwik et al., 2016; Moon, 2018). Finally, product and service specifications enhance respect, allowing Target to offer consumers products based on their needs and wants (Derwik et al., 2016). Product and service specifications focus on various features that appeal to consumers. This promotes loyalty and respect between consumers; hence, creating a positive environment for business.
Conclusion
Target Corporation has a stable supply chain management consisting of inventory management, logistics, procurement, product and service specifications, and order processing management and delivery options. Through procurement, Target has created a positive business environment with companies like Dairy Farmers of America, Homer Laughlin, and designers like Joanna Gaines and Magnolia collections, which supply home decorations, kitchen essentials, and food products. Besides, Target utilizes order processing management and value delivery options to supply products efficiently and optimize the supply chain network. The company has import distribution centers in Long Beach, California, to supply imported products via trucks or railroads to various regional distribution centers. Target has partnered with Microsoft to improve inventory management. This has enabled the company to manage sales information via a virtual storage cloud system. Also, Microsoft's partnership with Target has created an electronic logistical system to improve overall supply chain activities. Target's differentiated approach in product and service specifications enables it to offer consumer products based on needs and wants; hence, promoting loyalty and respect. Target's supply chain management helps it practice integrity, excellence, responsible stewardship, and respect in business and attain a competitive market edge. Therefore, the company's supply chain management monitors and tracks purchases, stored products, and the movement of merchandise across different American distribution centers, allowing it to compete effectively with other retail companies.
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