October 21, 2022
Target CEO Brian Cornell is only positive about the chain’s outlook for the 2022 holiday season.
Mr Cornell spoke Monday with Brian Sozzi at Yahoo Finance’s All Markets Summit and discussed Target’s approach to eliminating excess inventory through aggressive promotions that began in June.
“We put this inventory issue behind us,” he said. “And now we can focus on great execution, delighting our guests, getting ready for the big holiday season. So we were pretty decisive and said, we’re not just going to let this carry over into the next quarter. We’ll take care of that from the start, and now we’re excited to be ready to play for the holiday season.
Cornell doesn’t expect talk of a recession to slow his business, as high employment levels help offset inflation rates that have been at high levels for decades.
“Everyone is talking about a recession. And sitting here today, there are different points of view. You talk to bank CEOs. A bit of sadness and misfortune. Others say the consumer is really healthy [spending]. What we’ve seen throughout the year is really healthy traffic and a customer buying from our stores and buying online, so the strength of traffic has been driving our business. We have delivered solid compositions throughout this year. We expect this to continue for the remainder of the holiday season. »
Mr. Cornell’s trafficking claim is supported by to research by Placer.ai. In-store traffic increased 3.2% year-over-year during the week of October 3-9, which included Target’s Deal Days sales promotion to kick off the holiday season. Traffic growth for the week was double the year-over-year gain for the previous seven days. The retailer has seen weekly year-over-year gains in foot traffic since mid-August.
The Target CEO dodged a question about the focus on self-checkout and the large number of closed checkout lanes at a local store. He maintained that chain stores will be well staffed for the holidays. The retailer plans to add 100,000 seasonal workers to its payroll, up from 130,000 last year.
Mr. Cornell said he was confident Target would meet its hiring goal and put seasonal employees to work stocking and organizing stores, packing and shipping online purchases, assisting customers and handling pickup duties. Target expects about 30% of seasonal workers to stay with the company beyond the holidays.
DISCUSSION QUESTIONS: What do you think is behind Target’s continued shopper traffic gains and do you expect the trend to continue through the remainder of 2022? Do you see staffing, inventory, or other specific challenges tarnishing Target’s performance this holiday season?
“I hope Target takes the staffing issues and late payments seriously so they have a chance to crush the holiday shopping rush.”