Target will invest $5 billion to expand its business

This week, Target announced plans to invest $5 billion to continue to expand its business in 2022. The investment funds will be used to strengthen its physical stores, digital experience, fulfillment capabilities and supply chain capabilities to further differentiate its retail offerings and drive continued growth.

Target Chief Financial Officer Michael Fiddelke said that years of investment in its team and business has enabled the company to exceed $100 billion in sales and enabled Target to meet the needs of its guests . He also said that through the construction of the core, there will be a lot of opportunities for more customer engagement and long-term growth.

In addition, Target plans to open about 30 stores in 2022 to attract more consumers . In addition to the new stores, Target will also carry out 200 top-to-bottom renovations on its existing fleet based on the company's renovation plan .

It is understood that more than half of the chain's stores have been covered since the work began in 2017. In addition to the full-store transformation, Target will also complete hundreds of small projects throughout the chain to support the growth of its fulfillment services and expand in-store brand partnerships.

Target will also continue to enhance the in-store and online experience of its strategic brand partnerships in 2022 , such as collaborations with Ulta Beauty, Disney, etc. According to Target's official website, after opening 100 Ulta Beauty in its stores in 2021, Target plans to open more than 250 new stores by the end of 2022. Over time, Target will open at least 800 Ulta Beauty in its stores .

On the digital experience side, Target's ongoing technology investments are driving growth in digital capabilities such as Roundel, which data shows drove more than $1 billion in value in 2021, and the company expects that figure to grow to more than $2 billion in the next few years .

Notably, in fulfillment and replenishment capabilities . Target's same-day fulfillment service has grown nearly 400% since 2019 , accounting for more than half of the company's $13 billion in digital growth. This year, Target said it will continue to enhance its same-day service, adding Starbucks orders and easy return services in select stores before the holidays, and expanding alternate merchandise options for pickup orders to more categories.

To increase the speed, efficiency and capacity of its fulfillment operations, Target will also continue to invest in sortation centers, which organize digital orders to be packed by local stores for fast neighborhood delivery.

In 2021, Targe opened two new distribution facilities to support the increased inventory flow of its stores. It is understood that the company is currently developing four additional facilities to expand its supply chain capabilities and plans to increase the number of related facilities in the next few years .

Target

$5 billion