HomeeCommerce NewsTarget shares take a hit due to lower first-quarter profits

Target shares take a hit due to lower first-quarter profits

Target is one of the biggest e-commerce companies in the US along with the likes of Amazon, Walmart and Best Buy. Now, we know that e-commerce companies are the only ones that are currently operational in these times of the Coronavirus pandemic and we have seen that they are doing a great job at that. It is also a time when customers don’t really have a preference as to where they will shop. It is usually the case of whichever store online has the item in stock, they will buy it from there.

Due to this, we know that stores having lesser online presence such as Target, for example, are doing quite well too. However, the company says that they are still expecting lower first-quarter results even though their sales have increased. The simple reason behind this is that people are buying low-ticket items and it is obvious that they will do so. However, the costs for delivering such products at Target are adding up and that’s a problem.

Target CEO Brian Cornell said the retailer has benefited from investments in online shopping options, but it will have lower profits this quarter. He also said that they are currently spending more on labour in order to deliver as much items as possible. This also means an overhead cost while the profit margin on deliveries are not great. On the news that Target expects lower first-quarter revenue, the stocks for the company went tumbling down by 7% which is what the market tends to do.

The CEO mentions that they are committed to investing in Target’s online presence and he mentions that these “market share gains that I think will benefit the brand for years to come.” It is known that brands such as Walmart, Best Buy and Target had been investing in online space to compete with Amazon and this might be the right time to do so.

Sonali Minocha
Sonali Minochahttps://www.ecommercenext.org
Passionate about Innovation and Technology. I love to contribute to high impact projects/ products. I have co-created/contributed to technology solutions touching 100 million ++ humans. I am also fond of e-commerce & PIM solutions. As editor of eCommerceNext, I am bringing news, events, opinions, experts, reviews from the world of e-commerce and PIM Besides technology and innovation, I am usually involved in setting up and running complex operations and human capital systems. I have been grateful to be acknowledged by getting “Great Places to Work – Top 100”, “Great Places to Work – Top 50”, “Great Place to Work – Top 5” awards for my company. I am a people and relationship person and bring in a balance of empathy and realistic solutions. I thrive on building processes and building control systems. I led the team that achieved CMMI Level 3. I have managed large teams and in-turn managed projects worth 15-20 Million (Annually) Want me to cover an interesting story around eCommerce or PIM? Reach me on sonali@ecommercenext.org

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