Target has a tailwind

I posted a comment on RetailWire the week before Black Friday, anticipating a good outcome for Target. I think they’re well-positioned for success but not without some issues. Here’s my opinion:

Target is in a position to have a successful fourth quarter. It has the wind at its back in terms of a slowly recovering economy and evidence that the consumer is willing to spend on more discretionary products than during the past couple of years. This plays right into Target’s hands and is also making life tougher for Walmart than they expected.

At the same time, there are still plenty of execution challenges that Target needs to face, even if macroeconomic and competitive factors favor a good outcome. The apparel offering (especially in women’s) needs more clarity of offer and presentation, and stockouts continue to plague basic areas — at least in the high-volume stores that I visit regularly.

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