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Target still sees opportunity to grow at home

Posted by: under Best Buy, Retail, Target Updated: February 16, 2012 - 6:58 PM

 

 

With all the talk surrounding Target.com">Target.com and expansion into Canada, it's easy to forget that Target Corp. is still building stores in the U.S.

The company has not exactly been firing up the jackhammers of late, but Target still sees opportunity at home.

In July, it will open a 135,000-square-foot store in Inver Grove Heights, its first in Minnesota since March 2011. The store is one of 20 the retailer plans to debut this year, including five smaller CityTarget formats in cities such as Chicago, Seattle and San Francisco.

There's no doubt that Target has put its foot on the brake in recent years. From 2005 to 2009, the company opened about 85 stores a year.

Then in 2010, the retailer opened only 10 new stores.

Or look at it this way: Target's total square footage grew only 0.7 percent in 2010 compared with 8.3 percent in 2007.

Across the country, retailers, including Best Buy Co Inc. in Richfield, have been opening fewer bigger boxes and experimenting with smaller formats as more customers flock to Internet shopping.

But Target officials have told me that's not why store growth has remained low. Despite some shakeout in the commercial real estate market, Target thinks prices are still too high. Given the right place at the right price, Target would gladly fire up those jackhammers.

That Target plans to double the number of store openings in 2012 from that of two years ago suggests it's starting to see some good deals.

Thomas Lee • 612-673-4113


 

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