Target 2007 Annual Report Download - page 15

13
Supporting our growth
As our store count grows, we’ll continue to deliver a differentiated
shopping experience for our guests by investing in our supply chain,
technology and global workforce. In addition to Target Sourcing
Services, our global sourcing organization, we leverage Target India,
our headquarters extension office in Bangalore, to maximize efficiency
in areas such as systems development, analysis, reporting, auditing
and marketing.
In our supply chain, we continually work to control costs and
ensure our stores are in stock with the products our guests want
and need. In 2007, we opened two distribution centers, and
operated a total of 32 facilities at year end.
To support our growing food business, we are opening two
perishable-food distribution centers — one in Lake City, Florida
(August 2008), and one in Cedar Falls, Iowa (2009) — in addition
to maintaining productive partnerships with key vendors and
wholesalers.
We are also expanding our Target.com online fulfillment
capabilities. In 2009, we expect to complete construction of our
second Target.com fulfillment center in Tucson, Arizona.
Card-carrying guests
The disciplined and strategic approach of the Target Financial
Services team continues to deepen relationships with our guests
and drive profitable sales.
In 2007, we introduced the Target Check Card, a Target-branded
debit-based financial product that provides guests with many of the
same rewards and conveniences enjoyed by our credit card holders.
All Target REDcards — the Target Visa Credit Card, Target Credit
Card and Target Check Card—offer compelling reasons for guests
to shop our stores more often and to spend more on each visit.
Whether it’s the savings our guests receive through Target Rewards
and Target Pharmacy Rewards or the opportunity to contribute to
schools through our Take Charge of Education (TCOE) program,
our REDcards help Target strengthen our relationship with our
guests and reward them for their loyalty while driving sales for our
company. In fact, the average transaction amount for transactions
involving redemption of a Rewards certificate is approximately four
times greater than our average transaction amount.
The full integration of our financial services operation and core
retail business helps ensure that we’re focusing our efforts on
financial products that deliver the most value for our guests and
the company. We remain committed to maintaining our brand
standards and the valuable relationship we have with our guests
through our REDcard programs.
Uniquely Strategic
Delivering the products our guests expect to find in our stores
requires collaborative partnership throughout the company, including
marketing, merchandising, product design and development,
sourcing and store teams. We continue to invest in Target Sourcing
Services to locate the most qualified vendors across the globe,
who can reliably deliver high-quality goods that live up to our guests’
expectations. Our sourcing infrastructure requires continuous
innovation to fulfill our Expect More. Pay Less. brand promise to
our guests while giving us greater control of our brand. We are
leveraging our product design and development processes to
reduce cycle times, increase our speed to market, improve quality
and make great design affordable and accessible to everyone.
Product safety
Target’s vendors around the world are expected to operate efficient,
safe and ethical factories that produce high-quality products. We
continually seek to enhance our product safety and vendor education
efforts, and work closely with our partners to ensure compliance
with our vendor policies and local laws. We have enhanced our
product testing program by implementing multistage testing for
several owned-brand categories, which allows us to test products
earlier and throughout the product life cycle. In addition, we have
shared our knowledge with public officials and key stakeholders
to assist with their efforts to improve overall public safety.