Target Aims for Bullseye with Supply Chain Improvements Target, alongside other retailers, is constantly competing for the same share of the market place. Target invested $5 billion toward improving its supply chain and technology infrastructure in a two-year period, including raising its delivery time standards for suppliers and investing in same-day delivery. Then, Target tested a new distribution strategy in order to make its stores quicker at restocking and distributing to stores and customers. Target's "replenish cycle" took days, but its new distribution strategy reduces that cycle down to hours. In Target's smaller stores, located in more urban areas, the company reduced the amount of inventory it has. Instead of large shipments of inventory, Target makes smaller deliveries to fulfill exactly what the stores need. This is more of a just-in-time approach to inventory management, which reduces waste and allows stores to get exactly what they need when they need it. Target also acquired Shipt, a same-day grocery delivery service that delivers directly to consumers' doors. Shipt allows Target to compete directly against same-day delivery services offered by Amazon Fresh. Additionally, Target added fresh groceries and adult beverages to its drive up and pickup services. Using tools like these new distribution strategies and Shipt, Target is staying relevant against its competitors. Along with the new distribution strategy, Target is integrating its distribution and fulfillment operations into a new warehouse management system.e Critical Thinking Questions 1. Describe the many ways Target is trying to improve its supply chain in order to compete. 2. Why might changes to its inventory management improve Target's distribution? 3. What are some of the risks of adopting a just-in-time approach?
Target Aims for Bullseye with Supply Chain Improvements Target, alongside other retailers, is constantly competing for the same share of the market place. Target invested $5 billion toward improving its supply chain and technology infrastructure in a two-year period, including raising its delivery time standards for suppliers and investing in same-day delivery. Then, Target tested a new distribution strategy in order to make its stores quicker at restocking and distributing to stores and customers. Target's "replenish cycle" took days, but its new distribution strategy reduces that cycle down to hours. In Target's smaller stores, located in more urban areas, the company reduced the amount of inventory it has. Instead of large shipments of inventory, Target makes smaller deliveries to fulfill exactly what the stores need. This is more of a just-in-time approach to inventory management, which reduces waste and allows stores to get exactly what they need when they need it. Target also acquired Shipt, a same-day grocery delivery service that delivers directly to consumers' doors. Shipt allows Target to compete directly against same-day delivery services offered by Amazon Fresh. Additionally, Target added fresh groceries and adult beverages to its drive up and pickup services. Using tools like these new distribution strategies and Shipt, Target is staying relevant against its competitors. Along with the new distribution strategy, Target is integrating its distribution and fulfillment operations into a new warehouse management system.e Critical Thinking Questions 1. Describe the many ways Target is trying to improve its supply chain in order to compete. 2. Why might changes to its inventory management improve Target's distribution? 3. What are some of the risks of adopting a just-in-time approach?
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Transcribed Image Text:Responding to Business Challenges
Target Aims for Bullseye with Supply Chain Improvements
Target, alongside other retailers, is constantly competing for the same share of the market place. Target invested $5 billion toward improving
its supply chain and technology infrastructure in a two-year period, including raising its delivery time standards for suppliers and investing in
same-day delivery. Then, Target tested a new distribution strategy in order to make its stores quicker at restocking and distributing to stores
and customers.
Target's "replenish cycle" took days, but its new distribution strategy reduces that cycle down to hours. In Target's smaller stores, located in
more urban areas, the company reduced the amount of inventory it has. Instead of large shipments of inventory, Target makes smaller
deliveries to fulfill exactly what the stores need. This is more of a just-in-time approach to inventory management, which reduces waste and
allows stores to get exactly what they need when they need it.
Target also acquired Shipt, a same-day grocery delivery service that delivers directly to consumers' doors. Shipt allows Target to compete
directly against same-day delivery services offered by Amazon Fresh. Additionally, Target added fresh groceries and adult beverages to its
drive up and pickup services. Using tools like these new distribution strategies and Shipt, Target is staying relevant against its competitors.
Along with the new distribution strategy, Target is integrating its distribution and fulfillment operations into a new warehouse management
system.e
Critical Thinking Questions
1. Describe the many ways Target is trying to improve its supply chain in order to compete.
2. Why might changes to its inventory management improve Target's distribution?
3. What are some of the risks of adopting a just-in-time approach?
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