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Strategy and Business Model

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Discuss the relationship between Target's strategy and its business model, and why must a winning strategy fit the organizations internal and external environment.

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Discusses the relationship between Target's strategy and its business model, and why a winning strategy must fit the organizations internal and external environment. References provided.

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RESPONSE:

1. Discuss the relationship between Target's strategy and its business model.

A business strategy is developed as part of the business model specifically to meet the mission and objectives of the organization.

Target Corporation was founded in Minneapolis, Minnesota in 1902 as the Dayton Dry Goods Co. In 1962, the first Target store was opened in Roseville, Minnesota. It is the sixth-largest retailer (by sales revenue) in the United States behind Wal-Mart, The Home Depot, Kroger, Sears Holdings Corporation and Costco,[2] and is ranked 29th on the 2006 Fortune 500. It sells more gift cards than any other retailer in the United States and is also the third-largest seller of music in the United States.
Target Corporation competes directly against other discount retailers, mainly Wal-Mart and Kmart. Since its founding in 1962, its business model was intended to differentiate its stores from its competitors by offering what it believes is more upscale, trend-forward merchandise at low cost, as opposed to the traditional concept of focusing on low-priced goods. George D. Dayton, who founded the retail chain with John Geisse, explained that "We will offer high-quality merchandise at low margins, because we are cutting expenses. We would ...

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