Target 2021

Predicting the demise of Sears & Kmart since 2017!
bryceleinan
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Re: Target 2021

Post by bryceleinan »

storewanderer wrote: February 19th, 2021, 6:54 pm
Romr123 wrote: February 19th, 2021, 1:43 pm I live fairly close to a pretty excellent Target in a solidly middle-class area in first-ring Detroit...their food offerings are amazingly good--I always compliment the food staff there because they do a great job. Other stores in the area should take lessons. Just had a delivery order sent with some shelf-stable items--one of which (grated parm cheese) was very short dated--I Karened, complained and they took it off the bill.
I have noticed at the Sparks Target the food looks pretty good. However the Sparks Target is surrounded by apartments and the nearest grocery stores or grocery alternatives are all a mile or two away (take your pick- Safeway, Food Maxx, Smiths, 99 Cents Only, Grocery Outlet). Produce looks fresh and rotated and there is a good assortment of meat and bakery items to select from. At the Reno Target, which also has a lot of apartments nearby (not quite surrounded) but also more grocery competition within less than a mile (Whole Foods, Trader Joes, Wal Mart, and a Save Mart; Safeway failed twice in this radius first with a Pak N Save for about 2 years in the late 80's then again with a 1996 Safeway that lasted about 10 years); the entire area looks picked over. It is never fully stocked and what is there is often expiring that day or should be pulled (old produce). Both stores seem pretty busy overall. Then there is the Carson City Target which was just remodeled according to a banner out front (it was actually remodeled in 2019), they did not even add fresh food into the remodel there, despite that the nearest grocery options are a couple miles away (Wal Mart and Trader Joes) and you are like 5 miles from a conventional (a very sad Save Mart and an okay Raleys).
I'm actually surprised the Carson City store is still around - at one point, it was one of the lowest-performing stores in all of Target. As far as the food section, I think it would do well in there considering exactly what you pointed out - Walmart and Raley's are about it for decent grocery stores. I keep thinking that the old Staples would be a perfect spot for someone like Aldi, however, not sure if Target has the exclusive for groceries or not in the plaza.
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Re: Target 2021

Post by storewanderer »

bryceleinan wrote: April 15th, 2021, 7:21 pm
I'm actually surprised the Carson City store is still around - at one point, it was one of the lowest-performing stores in all of Target. As far as the food section, I think it would do well in there considering exactly what you pointed out - Walmart and Raley's are about it for decent grocery stores. I keep thinking that the old Staples would be a perfect spot for someone like Aldi, however, not sure if Target has the exclusive for groceries or not in the plaza.
I think the Carson Target always managed to eek out some little sales gains every year when they were considering whether or not to keep it. They finally did that remodel in 2019 which was the first capex the store ever got since it opened in the mid 90's. It probably has little to no theft and they likely do want a presence in that area. And when you look at their positioning there, they are positioned toward the "higher income" parts of Douglas County. Not real sure how interested those mostly retired people are in Target though.

I think a grocer in the center with Target would have the same issue Target has. For whatever reason that center just can't seem to draw many customers. Home Depot seems to do well there... but nothing else does. Staples moving out wasn't a big surprise but seeing Ross move out of what was a space built for Ross and good sized was a surprise especially seeing the awful converted shallow strip mall space Ross moved into closer into Carson.
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Re: Target 2021

Post by Romr123 »

Small tidbit about Pizza Hut--according to Yum Brands annual report apparently Target pays Pizza Hut about $5 million for the ability to run Pizza Huts in their stores, and a $1 million rebate went in the other direction (Pizza Hut to Target)...net is that Target pays about $4 million to have Pizza Hut in the snack bars.
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Re: Target 2021

Post by veteran+ »

Romr123 wrote: April 23rd, 2021, 11:11 am Small tidbit about Pizza Hut--according to Yum Brands annual report apparently Target pays Pizza Hut about $5 million for the ability to run Pizza Huts in their stores, and a $1 million rebate went in the other direction (Pizza Hut to Target)...net is that Target pays about $4 million to have Pizza Hut in the snack bars.
Wow, that doesn't sound right at all.

:?
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Re: Target 2021

Post by retailfanmitchell019 »

Romr123 wrote: April 23rd, 2021, 11:11 am Small tidbit about Pizza Hut--according to Yum Brands annual report apparently Target pays Pizza Hut about $5 million for the ability to run Pizza Huts in their stores, and a $1 million rebate went in the other direction (Pizza Hut to Target)...net is that Target pays about $4 million to have Pizza Hut in the snack bars.
The Pizza Huts in Target are Express snack bars with nothing more than crummy Personal Pan Pizzas and mediocre breadsticks, which are probably microwaved.
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Re: Target 2021

Post by babs »

veteran+ wrote: April 23rd, 2021, 11:15 am
Romr123 wrote: April 23rd, 2021, 11:11 am Small tidbit about Pizza Hut--according to Yum Brands annual report apparently Target pays Pizza Hut about $5 million for the ability to run Pizza Huts in their stores, and a $1 million rebate went in the other direction (Pizza Hut to Target)...net is that Target pays about $4 million to have Pizza Hut in the snack bars.
Wow, that doesn't sound right at all.

:?
Target.ia getting ripped off. They'd sell just as many if they were branded Market Pantry.
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Re: Target 2021

Post by Romr123 »

I'm neither buying nor selling, but being able to turnkey a concept is quite valuable to an organization like Target/Walmart/etc. Running a snackbar isn't core to their business, and if for $4m they can get a turnkey, recognizable pizza concept (undoubtedly they're paying more $$$ for Starbucks, but the analogy holds) for which they merely have to provide space, staff and equipment (they rely on Pizza Hut for the "how to do it" on the pizza side) it's probably a good trade-off.
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Re: Target 2021

Post by veteran+ »

Is this a different arrangement with department stores?

Because every supermarket company I worked for never paid anyone to be in their store including coffee shops, Panda, Jamba, dry cleaners, fragrance-gift alcoves, shoe repair, etc.
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Re: Target 2021

Post by Romr123 »

That's part and parcel of the franchise business--charge for the concept (which includes branding, the confidential operations manual/COM, supply arrangements, etc) and to the extent possible ancillary services (real estate, planning, architecture, etc etc). Joe Franchisee has to pay for both. Target (WalMart, truck stops, college campuses, airports, etc) don't need help with the ancillary services--they've got staff and a building; the franchisor adapts their normal "concept" and slims it down for the "experienced" operator dealing with "express" locations. Yum Brands has KFC/Taco Bell/Pizza Hut/Habit; and probably wouldn't be too bothered if Target suddenly thought that they might like to convert 50 Pizza Huts to 50 KFC Expresses...but that's probably not in the cards.
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Re: Target 2021

Post by veteran+ »

Okay I see.

We did not have that kind arrangement in grocery stores.
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