Signs of trouble at Target?

storewanderer
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Re: Signs of trouble at Target?

Post by storewanderer » July 5th, 2019, 9:31 am

veteran+ wrote:
July 5th, 2019, 9:17 am
klkla wrote:
July 4th, 2019, 6:42 pm
storewanderer wrote:
July 4th, 2019, 11:55 am
The logic is that if "minimum" wage rises it should push other wages up too, but will it? We will see.
That's the key that a lot of people don't get. That's what it's really about. There is plenty of statistical evidence to prove it is true.

But a lot of the other points you make are valid, as well. This topic is probably is too complicated for a thread about Target but suffice to say that if companies like Target were forced to pay a higher minimum wage it would help to start narrowing the income gap.
Yes, it's complicated but root cause analysis would reveal (and has revealed) that excessive corporate wealth (Executive compensation and Stock Holders' profit demands) is what drives the abusive income disparity.

Trickle down is stunted or withheld in the name of competition, research/development, capital expenditures, technology, mergers, acquisitions, etc., etc.

Many of these "excuses" often do not show substantial increases in expenditures to support the reason for low wages and benefits for the rank and file.
I think high debt levels and high debt servicing costs both for corporations and individuals are also a big part of this problem that gets less attention than it should, since the whole economy is driven by debt.

Let's use private equity owned retailer for instance. I won't name names. Private equity owned retailer has numerous properties in California that have been in the company for decades. Extremely valuable real estate. Private equity owner pumps said retailer full of debt. So much debt, the company can't make any money. Private equity retailer then engages in a practice of selling selected old properties off for millions of dollars then takes draws out of the company. Company keeps losing money but private equity gets paid. "Investors" bought the properties (with loans...more debt) and now there is a higher rent payment on these stores so the stores are less profitable than before since they now have a rent payment (I guess they can make up for it by increasing prices and not increasing employee wages), the company has just as much debt as before since all the proceeds from property sales were drawn out by the private equity owners, and now in addition to the debt service costs that were already making the company unprofitable, now it has a higher rent payment on the store than it had before to further pressure profits.

rwsandiego
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Re: Signs of trouble at Target?

Post by rwsandiego » July 5th, 2019, 10:35 am

storewanderer wrote:
July 5th, 2019, 9:31 am
veteran+ wrote:
July 5th, 2019, 9:17 am
klkla wrote:
July 4th, 2019, 6:42 pm


That's the key that a lot of people don't get. That's what it's really about. There is plenty of statistical evidence to prove it is true.

But a lot of the other points you make are valid, as well. This topic is probably is too complicated for a thread about Target but suffice to say that if companies like Target were forced to pay a higher minimum wage it would help to start narrowing the income gap.
Yes, it's complicated but root cause analysis would reveal (and has revealed) that excessive corporate wealth (Executive compensation and Stock Holders' profit demands) is what drives the abusive income disparity.

Trickle down is stunted or withheld in the name of competition, research/development, capital expenditures, technology, mergers, acquisitions, etc., etc.

Many of these "excuses" often do not show substantial increases in expenditures to support the reason for low wages and benefits for the rank and file.
I think high debt levels and high debt servicing costs both for corporations and individuals are also a big part of this problem that gets less attention than it should, since the whole economy is driven by debt.

Let's use private equity owned retailer for instance. I won't name names. Private equity owned retailer has numerous properties in California that have been in the company for decades. Extremely valuable real estate. Private equity owner pumps said retailer full of debt. So much debt, the company can't make any money. Private equity retailer then engages in a practice of selling selected old properties off for millions of dollars then takes draws out of the company. Company keeps losing money but private equity gets paid. "Investors" bought the properties (with loans...more debt) and now there is a higher rent payment on these stores so the stores are less profitable than before since they now have a rent payment (I guess they can make up for it by increasing prices and not increasing employee wages), the company has just as much debt as before since all the proceeds from property sales were drawn out by the private equity owners, and now in addition to the debt service costs that were already making the company unprofitable, now it has a higher rent payment on the store than it had before to further pressure profits.
To take this a step further, one private equity-owned retailer after another is filing for bankruptcy. The creditors and the employees take the loss and the private equity firm is relatively unscathed. In essence, the other stakeholders pay for the private equity firm's bleeding the company dry. The result is lower profits for the creditors and financial ruin for vulnerable employees.

Meanwhile, back at Target, the appearance of many of its employees has deteriorated. I liked the days where everyone wore a red polo and khakis. Not sure whether they subsidized the polos/khakis or provided a discount on "uniform" clothes like many other retailers do (for example, a general 20% discount plus 40% off a certain number of pieces that are worn to work), but it provided a more uniform appearance. Thinking back to Catholic grade school, it also eliminates any outward display of status. When everyone wears the same thing you can't tell who earns what or who has a what sense of style. Then again, I haven't been able to bring myself to wear a gold polo shirt (my school's uniform shirt for boys) since 1979. :)

That said, I don't think Target is "in trouble." To me, they are evolving as a retailer. While I liked the popcorn, I haven't bought it in more than five years. A display of watermelons or mini-fridges on a pallet also doesn't bother me. I don't know how else they would display them. The in-aisle displays were annoying at first, but I've become accustomed to them. Frankly, the ones that look like a giant shopping basket are cute.

Comparing Target to Walmart I'll take Target any day.

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