How Target Profits From Smaller Stores

The days of the mall seem to have peaked, and boutique experiences are up-and-coming as the new way to do business for many retailers. Target (NYSE: TGT), always quick on the uptake, has been moving into this "small store" segment for the past several years, picking up on this change in preference, and is now going with it full throttle.

Target operates around 1,900 full-store format locations, each one averaging about 130,000 square feet. These are large enough to offer everything a customer could want, from food and toiletries to housewares and electronics. This was the original anti-department-store format, offering a cleaner, wider-aisled experience plus the in-store supermarket, all at better pricing.

But that format didn't work everywhere that Target shoppers wanted to be, so the growth-focused retailer went smaller. The company originally toyed with the concept in 2012, adding 30 small stores total until the time became ripe (over the past year) to expand the concept nationally. It opened another 30 small stores last year and plans to add 30 additional ones each year.

Source Fool.com