Question

How does Target’s business model compare with Walmart’s and Costco’s?

Answer 1

Target business model:

traded as target corp(TGT) around 2000 stores in united states and has a low pricing strategy similar to walmart and costco's. However target are concentrating more on e- commerce business than traditional way of mega stores.

Walmart business model:

Walmart stores inc is the worlds largest retail company wioth around 11400 stores in which 5000stores are in united states. Five times bigger than target with high inventory and asset turnover.

COSTCO BUSINESS MODEL:

Second largest retail chain after walmart who target more on upper middle class and offer branded products in discounted prices. Strategy is to Concentrate more on developing the membership base.

PROFITS:

Eventhough both target and walmart has below-industry-average net profit. Target have performed very well than walmart in terms of gross profit and net profit.

INVENTORY, ASSET AND RECIEVABLES TURNOVER :

Walmart performed very well in all the above mentioned turnovers than costco's and target which clearly shows how efficient a business is.