Target Is Closing Down Stores Right Now As America’s Largest Chains Prepare For Trouble This Fall

They say that if you go woke, you’ll go broke – and, unfortunately, that seems to be the case with Target. The company is one of the biggest department store chains in the U.S. today after more than 60 years of building its brand to finally become a household name. But now, even its shareholders are saying that the retailer appears to be on its last legs. After facing serious criticism for releasing controversial products and selling them close to children’s items, many consumers have boycotted Target’s stores, and sales have started to collapse at record-breaking speed.  Continued below the video

Some call it “Bud Light 2.0,” referring to the rapid downfall of the beer brand following a catastrophic campaign released earlier this year that pushed the stock of parent company Anheuser Busch to drop by 45%, and sales to decline by over $400 million since June.  Target is seriously struggling right now. This week, the retailer announced that it will conduct another round of store closings in October, eliminating several locations in major U.S. cities. Starting on October 21, Target will shut down stores in New York, San Francisco, Oakland, Portland, and Seattle. The company cited concerns over rising shoplifting rates and poor financial results at the stores. In a note released on its website, Target noted that rampant retail theft in multiple markets contributed to an “unsustainable business performance.”

“Despite our efforts, unfortunately, we continue to face fundamental challenges to operating these stores safely and successfully,” executives wrote in the release. After losing more than $14 billion in market capitalization so far in 2023, Target can not afford any more losses, so it is using its last resort to try to save its business. Of course, the rise in retail theft only tells us half of the story.  Target’s overall financial results have been sharply deteriorating since last year, and this month, the chain added to investors’ concerns after reporting its first double-digit sales decline in the digital category, and the biggest drop in comparable sales at physical stores in at least four years.   Target stock has crashed by more than 20% year-to-date. Just before the pride clothing controversy broke into the mainstream, Target traded at $160.69 per share.

By June 1, it had fallen to $131.16 per share. At the end of the second quarter, it dipped to $125.08. And now, it bottomed out at around $112. Analysts are now predicting that revenue will fall another 5% in Q3, but there are many signs the decline could be much worse. According to Bloomberg Second Measure, which tracks anonymous credit and debit card transactions, Target sales recorded an 8.7% drop in August, and conditions in September aren’t looking any better.  Executives are trying everything to stop the bleeding. But when a brand loses the consumer confidence built over the course of decades, it loses its own foundation. Target must fight for survival in an industry where department store chains continue to go under. If management fails to restore what has been broken, Target may face a slow and painful death just like many other big retailers.

Get back to that pre-COVID feeling.