Target Corp Advantages and Disadvantages

Gopher Place:

- Five existing stores already in the area

- Walmart expected to add two new supercenters – considered to have a very favorable median household income and growth rate

- 19% of sales included in the forecast expected to come from existing target stores

- $56,400 median income

- 12% adults 4+ years of college

- 12.3% IRR

- Population of 70,000

Advantages:

- 5.3% below the R&P forecast level

- Favorable population growth (27%)

- Building a P04 model

- Favorable median household income

Disadvantages:

- Fairly low investment of 23 million

Whalen Court:

- 119.3 million investment

- Unique single-level store

- 1.9% above the R&P forecast level

- Target operates 45 stores in this market

- Opportunity for target to enter the urban center of a major metropolitan area

- Major brand visibility and essentially free advertising

- Balance of large investment against brand awareness benefits it would bring

- Store would have to be leased

- $48,500 median income

- 45% adults 4+ years of college

- 9.8% IRR

- Population of 632,000

Advantages:

Disadvantages:

-very little growth in population (3%)

The Barn:

- 13.0 million investment

- P04 store

- 18.1% below the R&P forecast level

- Initial development efforts failed because of disagreements the first time

- Small rural area

- $38,200 median income

- 17% adults 4+ years of college

- 16.4% IRR

- Population of 151,000

Advantages:

- Small initial investment allows for large return on investment even if sales growth turned out to be less than expected

- Nearest targets 80 and 90 miles away

Disadvantages:

- Very little growth in population (3%)

Goldie’s Square:

- 23.9 million investment

- Super target

- 45.1% above the R&P forecast level

- Currently operated 12 stores in the area and expected to have 24 eventually

- Relatively weak NPV figures

- Fast growing population

- Hotly contested area

- Could afford good brand awareness should the growth materialize

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