Target 2008 Annual Report Download - page 23

Waverly and Woolrich. We also generate revenue from in-store amenities such as Food Avenueᓼ, Target
Clinicᓼ, Target PharmacySM, and Target PhotoSM, and from leased or licensed departments such as Optical,
Pizza Hut, Portrait Studio and Starbucks.
Percentage of Sales
Sales by Product Category
2008 2007 2006
Consumables and commodities 37% 34% 32%
Electronics, entertainment, sporting goods and toys 22 22 23
Apparel and accessories 20 22 22
Home furnishings and d´ ecor 21 22 23
Total 100% 100% 100%
Distribution
The vast majority of our merchandise is distributed through our network of distribution centers. We
operated 34 distribution centers at January 31, 2009. General merchandise is shipped to and from our
distribution centers by common carriers. Certain food items are distributed by third parties. Merchandise sold
through Target.com is distributed through our own distribution network, through third parties, or shipped
directly from vendors.
Employees
At January 31, 2009, we employed approximately 351,000 full-time, part-time and seasonal employees,
referred to as ‘‘team members.’’ During our peak sales period from Thanksgiving to the end of December, our
employment levels peaked at approximately 400,000 team members. We consider our team member
relations to be good. We offer a broad range of company-paid benefits to our team members. Eligibility for,
and the level of, these benefits varies, depending on team members’ full-time or part-time status,
compensation level, date of hire and/or length of service. These company-paid benefits include a pension
plan, 401(k) plan, medical and dental plans, a retiree medical plan, short-term and long-term disability
insurance, paid vacation, tuition reimbursement, various team member assistance programs, life insurance
and merchandise discounts.
Working Capital
Because of the seasonal nature of our business, our working capital needs are greater in the months
leading up to our peak sales period from Thanksgiving to the end of December. The increase in working
capital during this time is typically financed with cash flow provided by operations and short-term borrowings.
Additional details are provided in the Liquidity and Capital Resources section in Item 7, Management’s
Discussion and Analysis of Financial Condition and Results of Operations.
Competition
In our Retail Segment, we compete with traditional and off-price general merchandise retailers, apparel
retailers, Internet retailers, wholesale clubs, category specific retailers, drug stores, supermarkets and other
forms of retail commerce. Our ability to differentiate ourselves from other retailers largely determines our
competitive position within the retail industry.
In our Credit Card Segment, our primary mission is to deliver financial products and services that drive
sales and deepen guest relationships at Target. Our financial products compete with those of other issuers for
market share of sales volume. Our ability to differentiate the value of our financial products primarily through
our rewards programs, terms, credit line management, and guest service determines our competitive
position.
Intellectual Property
Our brand image is a critical element of our business strategy. Our principal trademarks, including Target,
SuperTarget and our ‘‘Bullseye Design,’’ have been registered with the U.S. Patent and Trademark Office.
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PART I