How Target Became A Highly Profitable Company, The Critical Success Factors Behind Target's Success As A Highly Profitable Retailer, Target's Growth Strategies For Long Term Revenue Growth, And The Future Outlook Of Target In The Digital Era
This essay sheds light on how Amazon became a highly profitable company, identifies the critical success factors behind Target's success as a highly profitable retailer, demystifies Target's growth strategies for long term revenue growth, and reveals the future outlook of Target in the digital era. Amid the early 1990s, Target achieved the ineffably stupendous feat of becoming a highly profitable company. Target was able to become a highly profitable company for a multitude of reasons. Target has become the second largest retailer in the United States and is slated to become more profitable in the coming years. "Target's net income for the twelve months ending July 31, 2021 was $6,308,000,000, a 79.1% increase year-over-year". Moreover,"Target's revenue for the twelve months ending July 31, 2021 was $100,328,000, a 18.52% increase year-over-year". Target has become a highly profitable company in the digital era to the extend of being able to exceed $6,300,000,000 "in net income for the twelve months ending July 31, 2021". Target has been able to generate significantly more net income per store than Walmart. "Even though Walmart operates approximately 10,500 stores and clubs under 48 banners in 24 countries and eCommerce websites", "Walmart's net income for the twelve months ending July 31, 2021 was $10,050,000,000". Even though Target currently has only has 1,914 stores in the United States which is less than one fifth of the amount of stores and clubs that Walmart has, "Target's net income for the twelve months ending July 31, 2021 was $6,308,000,000" which is ultimately almost 63% the amount that Walmart's net income was during the same time period from "the twelve months ending July 31, 2021". If Target had as many retail stores as Walmart then it would be apt to generate far more net income than Walmart. If Target for instance could for instance earn an average net income of $3,295,715.77 per store and expanded to having 10,500 stores in order to have as more retail stores as Walmart has retail stores and clubs, then Target would earn at least $34,605,015,673.9 in net income which indeed is a far cry from Walmart's $10,050,000,000 in net income that was generate primarily from its stores and clubs "in twelve months ending July 31, 2021". There is however no guarantee that Target would be able to generate at least $34,605,015,673.9 in net income even if Target had as many retail stores as Walmart has retail stores and clubs. While Target stores may yield higher profit margins per store than Walmart stores, overly saturating the retail market by establishing stores everywhere could cause cannibalization of stores and culminate in the stores yielding significantly lower net profit margins or even becoming unprofitable if customer traffic is spread too thin as a result of a retailer over expanding. Walmart net profit margin per store is infinitesimal. "Walmart net profit margin as of July 31, 2021 is 1.78%". "Target net profit margin as of July 31, 2021 is 6.29%". It is enigmatic if Target would be able to reap significantly higher profit margins than Walmart if they profusely expanded their operations by launching as many retail stores as Walmart has retail stores and clubs. If their average net income per store remained at least $3,295,715.77 per store then Target would need about 3050 stores to generate as much net income as Walmart if Walmart's net income remained at $10,050,000,000 primarily from earning product sales from 10,524 stores and clubs. If Target's net profit margins per store remained more than triple Walmart's net profit margins per store than Target could generate net income on par with Walmart even with having around one third as many stores as Walmart has stores and clubs. Target is so profitable that even just one of its store can generate more net income than three Walmart stores can generate as an aggregate. that even just one of its store can generate more net income than three Walmart stores can ge
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