Archived store closing?

[OneGoodEar]

I'd definitely agree that stores that open at 7 or close at 11 or 12 have higher sales, but there are other factors that could cause a store to close at 10.

Right.

 

[fiddlesteinfip]

The store closing my state is about 15 miles from my store. The area it is in has a bad reputation. When I look up availability of an item that we are out of 0 out of 20 guests expressed any desire to go to that store for any item and asked about other stores that were further away that had availability.

This sounds like the closing store near me that's part of a dead mall. They're constantly writing up security incidents of assaults in the parking lot. Think there were a few shootings there too. I think it's best for the company and the safety of those team members to shut it down.

 

[SrTLall]

Your are most likely referring to Amazon's "Pop Up Stores" (the most active of Amazon's expansion models). These are literally Kiosk type stores located in malls and other tactical locations such as college campuses. Not the same thing we're doing.

Amazon is horizontally integrating, but nothing near to the scale or similar to what we are doing. Theirs is one of acquisition of businesses to expand (Whole Foods).

Target is using demographics to position new stores in areas which current and future guest are found. If I recall correctly, Target's key demographic market is women, ages 20 - 40 years of age, either going to college, attended college, or graduated from college, anticipates having a family or has a family. This is why the push into urban areas and college campuses.

Eventually this base does move on and out of those areas. Hopefully their experience builds loyalty and they continue to shop at the traditional stores.

The above being said, Target is building brick and mortar operations in expensive areas to operate a retail business in. The smaller the foot print, the higher $/sq ft required. You can't get around that cost impacting the profitability of such stores. Some stores will stay open, but a lot will close due to the bottom line.

All of the above business models you mention have been done before. The results were the same over time, they closed. They just couldn't generate enough $/sq. ft. Unless Target is willing to heavily subsidize these stores, or lower the profitability expectations, the inevitable will happen. You can't reinvent the wheel.

Amazon, unlike us, has the advantage of selling product where the $/sq ft is substantially less. We on the other hand have the advantage of having a place where you can go and actually touch the product. We just have to make sure we have merchandise when the guest arrive or they'll go elsewhere.

I am not talking about the pop up stores. I am talking about Amazon 'Books.' And no, this business model hasn't been done before. Amazon tells the consumers what their business model is:

Amazon Books is a store without walls – there are thousands of books available in store and millions more available at Amazon.com. Walk out of the store with a book or device; lighten your load and buy it online (Prime customers, of course, won’t pay for shipping); download a book for your Kindle; or add a product to your Amazon Wish List, so someone else can buy it.

Amazon: "Hey customer! Come to our physical location, shop our high-margin items, order it, or something similar, online!" And, no, Amazon Books is not just a bookstore, they want you to test out their devices and be able to see some other high-margin items that cater to the location's demographic.

This is what Target is doing. There is no need for massive sales floors anymore because retailers don't need to represent every style of the same exact item in stores anymore. Example: Target doesn't need to display every single color of towel in the store anymore because if a guest doesn't find the exact color they want, they can order it online on the spot and receive it in a couple of days. Eventually, and I'll be hyperbolic, Target will only need 1 white towel of each style in stores, but that 1 towel will represent hunderds of colors and patterns. Imagine the margin on that 1 white towel. Target already does this in the big stores with car seats and furniture. This is exactly what Amazon is advertising on their site about Amazon Books. Amazon is trying to change the consumer's idea of what it means to go to a brick and mortar location and Target is coming along for the ride.

 

[HRZone]

This is what Target is doing. There is no need for massive sales floors anymore because retailers don't need to represent every style of the same exact item in stores anymore. Example: Target doesn't need to display every single color of towel in the store anymore because if a guest doesn't find the exact color they want, they can order it online on the spot and receive it in a couple of days. Eventually, and I'll be hyperbolic, Target will only need 1 white towel of each style in stores, but that 1 towel will represent hunderds of colors and patterns. Imagine the margin on that 1 white towel. Target already does this in the big stores with car seats and furniture. This is exactly what Amazon is advertising on their site about Amazon Books. Amazon is trying to change the consumer's idea of what it means to go to a brick and mortar location and Target is coming along for the ride.

This is spot on, the MyCheckouts are a step in that direction. As long as the money goes to Target they don't care if they take it home right then or get it shipped to them.

 

[Softsoul]

Ass backwards if you ask me, people come to target for a certain color of towels because they don’t want to wait a couple of days. We’re coming along for the ride, but we’re crashing and drowning