Target turnaround requires cultural re-invention that simplifies stores and overhauls supply chain
Target is set to invest an additional $1 billion into the business in 2026. This comes as the retailer’s third quarter net sales dropped 1.5% year over year to $25.3 billion and comparable sales decreased 2.7%.
About $5 billion in capital expenditure is being made available to “support new stores and remodels, enhancements to the store experience and advancements in technology and digital fulfillment capabilities."
It's the wrong strategy, according to retail analyst, Karen Short, who believes that Target should stop opening stores and reduce CapEx for calendar 2026/2027.
"Turning aorund the company will require a cultural re-invention because management is too arrogant and oblivious to the fact that the company: a) is not Tarjey anymore, b) has zero presence in food and beverage, and c) has lost the draw in discretionary," she says.
"The bigger question is: how does the board not see this? The board has a fiduciary duty to navigate a retailer through landmines and it seems uninvolved and disconnected.”
She adds: "The focus should be on simplifying the stores vs. the current strategy of continuing to complicate store level execution. Target also significantly trails Walmart as it relates to the supply chain, logistics and last mile delivery capabilities. Its weak supply chain management is a red flag."
Brittain Ladd, a supply consultant and former Amazon executive, comments: "There are many things that are broken at Target. For example, its market cap of $38 billion is the same as it was in 2012. Target's market cap was $110 billion in 2021.”
“I find it hilarious that executives there continue to speak as if it is an elite retailer on the same level as Walmart, Amazon, and Costco Wholesale. It isn't. The Home Depot, Lowe's Companies, and Kroger are worth significantly more than Target."
"I encourage Trian Fund Management, Elliott Investment Management, and Starboard Value to launch an activist campaign against Target. Jeff Smith, CEO at Starboard, is brilliant. Starboard can make Target a much better company by replacing senior executives and adding board members."
Target did not respond to our request for comment.
2025 RTIH INNOVATION AWARDS
Physical stores were a key focus area at the 2025 RTIH Innovation Awards.
We received a record number of entries and many fantastic examples of the continued resilience and dynamism of the retail space during hugely challenging times.
For a full rundown of all of the shortlisted entries, click here.
Our 2025 hall of fame entrants were revealed during a sold out event which took place at The HAC in Central London on 16th October and consisted of a drinks reception, three course meal, and awards ceremony presided over by award winning comedian, actress and writer Tiff Stevenson.
In his welcome speech, Scott Thompson, Founder and Editor, RTIH, said: “This is the awards’ fifth year as a physical event. We started off with just 30 people at the South Place Hotel not far from here, then moved to London Bridge Hotel, then The Barbican, and last year RIBA’s HQ in the West End.”
“But I’m conscious of the fact that, to quote the legend that is Taylor Swift, You’re only as hot as your last hit, baby. So, this year we’ve moved to our biggest venue yet, and also pulled in our largest number of entries to date and broken attendance records.”
He added: “This year’s submissions have without doubt been our best yet. To quote one of the judges: The examples of innovative developments across both traditional and digital retail spaces were truly remarkable.”
Congratulations to our winners, and a big thank you to our sponsors, judging panel, the legend that is Tiff Stevenson, and all those who attended our 2025 gathering.
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