Target recommits to small stores

Walmart may have abandoned its small store efforts, but Target is doubling down with plans to eventually have hundreds of its "flexible formats."

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CEO Brian Cornell believes the format will be a key part of the company's future growth. Already there are 23 such locations, and the vast majority of new stores opened this year are small and give Target entry into new markets.

Flexible-format stores carry a merchandise mix differentiated by market. Those near college campuses have more dorm and single-serve items, and those in urban centers are serving cocktails and carrying a selection of locally sourced foods and craft beer.

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Still, flexible formats won't solve Target's bigger problem: food.

Shoppers are not visiting Target discount stores for the more frequent fill-in trips that grocery departments are designed to satisfy. Current executive additions with grocery experience and initiatives to brand and differentiate the department with healthier options have yet to bear fruit.