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"15 Facts Target Is Getting Pulverized By This Economy"
by Epic Economist
"Target’s boom may be over, but its bust has only just begun. The retailer saw sales skyrocketing during the pandemic, but everything came crashing down when inventory imbalances plunged profits by over 90% in a single quarter. Its supply chain problems continue to spark major disruptions in its operations and cause frustration among shoppers who are tired to see empty shelves at Target's stores. Several signs of distress are indicating that the company's financial health is rapidly deteriorating, and believe it or not, the megachain is falling behind smaller competitors in many categories right now.
Three years after the pandemic, Target aisles are still looking barer than normal. Shortages of baking goods, meats, produce, dry goods, and frozen food are making customers increasingly frustrated. On social media, thousands of posts document the retailer’s inventory holes. “What the heck is going on at Target? Have they given up?” one shopper asked on Reddit with an image of empty shelves. “My local target has looked like this recently too. I don’t know what's going on,” answered another. “The shelves are always half-empty, and if you ask a clerk for something, she may say “I’ll see” and point vaguely to two or three barren shelves down the way,” a third commented. “Is your Target at an all-time low right now, too?” another user asked. One employee responded, “None of us have enough hours. The stores are in disarray because no one has time to pick anything up at this rate. Our fulfillment team is getting the raw end of the deal as per usual. I overheard customer service workers telling someone on the phone that fulfillment can’t complete their order the same day it was ordered because they are so far behind. It's all spiraling out of control.”
In other words, its supply chain may be a much bigger problem than anyone imagined. According to retail expert Neil Saunders Target’s messy supply chain may cost an additional $100 million for the company this year. Problems with its next-day delivery capabilities, supplier losses, expensive transportation, and clogged warehouse space are just a few of the issues plaguing the retailer’s supply chain right now. If the chain doesn’t fix its network and improves its operations, expenses can be even greater than predicted and further damage Target’s balance sheet.
If the company fails to strategize during this critical moment, we are likely to see mass store closings and widespread layoffs being announced. Never before in history, the big-box chain faced so many difficult challenges all at once. With economic indicators signaling that more volatility is coming, the retailer must position itself to fight yet another battle. If there's something that we learned in the past few years is that the retail apocalypse forgives no one. We've seen huge chains falling apart and disappearing from one year to the other, and if Target doesn't play catch up soon, it may suffer from the same fate as other collapsing retailers. Today, we compiled several facts that reveal how poor Target's financial situation really is and expose the factors threatening to dismantle the retailer's business in 2023."
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