Targeting sales growth in fourth quarter

The pace of retail sales remains Target’s top priority following the release of weak third quarter results yesterday amid what senior executives described as an increasingly challenging retail environment.

Retail sales advanced a paltry 1.7% to $14.6 billion and same-store sales declined 3.3% during the quarter ended Nov. 1. On a positive note, operating profits for the retail division increased nearly 8% to 772 million due to gross margin improvements.

According to Target president and ceo Gregg Steinhafel, the company will be well-served during the holidays by its two-pronged, “expect more, pay less,” value proposition.

“We are working to ensure that consumers understand the two are not mutually exclusive and their synergy is what makes us Target unlike any other retailer,” Steinhafel said. “With a strong emphasis on delivering exceptional value, we believe that Target, Wal-Mart and Costco will be the big winners this holiday season.”

The company is off to a rough start and during November expects to report a same-store sales decline between 6% and 9%. Also, it is likely fourth quarter same-store sales will be negative. Even so, Steinhafel asserted that Target is well positioned to withstand the current economic climate and emerge far stronger from the shakeout that will follow this holiday season.

“We recognize that some of our other retail competitors may not emerge intact from the current economic turmoil,” Steinhafel said. “While we do not celebrate the misfortune of others in our industry, we believe a smaller competitive set would be to our benefit when the economy improves.”