Five Forces | Explanation | Strength |
Bargaining Power of Customers | Can customers force the prices down? | Medium- Customers have options for cheaper products, but Targets’ superior products keep customers shopping there |
Threat of Substitution | Can customers switch to other products that satisfy their needs? | Medium- Although they are more expensive, Target has a unique selection of products and some are exclusively sold at Target |
Bargaining Power of Suppliers | Where does Target buy supplies from? | Low- Target imports about 500,000 containers of merchandise from places like China, Indonesia, Vietnam, India, and Thailand. |
Threat of New Entrants | How easy is it to start a retail store that is as big as Target? | Low- Target is a well-known company with over 1,900 locations. It would be hard for a new company to eat into their market share and take customers and profit away |
Rivalry | What are other real stores that Target competes with directly? | Medium- There are few companies that can rival Target. Their main rival is Walmart, but also face competition from places like Shoprite and Costco when it comes to the grocery sector of their stores |
*Industry Wide Low-Cost or Industry Wide Differentiation?
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