Grocery gains again fuel Target’s comp growth
MINNEAPOLIS — February same-store sales at Target advanced 1.8%, thanks to the addition of fresh food and consumables that are part of an aggressive remodeling program causing more people to shop its stores. The company said more than half of its February same store-sales gain was driven by an increase in transactions combined with a small increase in the average transaction size. The 1.8% gain comes on top of a 2.4% increase in February 2010.
The strongest performance came in the grocery category where comps increased in the low teens while the health care, beauty and other household essentials experienced gains in the mid- to upper single-digit range. Also showing strength was the apparel category where comps increased in the low to mid single digit range.
“Target’s February comparable-store sales were in line with our expectations, as our REDcard Rewards and PFresh remodel programs continue to drive meaningful incremental sales and traffic in our stores,” said Target chairman, president and CEO Gregg Steinhafel.
The rewards program was launched last fall at stores nationwide and offers those who used Target branded credit and debit product 5% off all purchases. The PFresh program is an ambitious store remodeling effort that has as its signature component the addition of fresh foods and an expanded dry grocery and consumable offering to existing Target discount stores.
A 1.8% comp isn’t exactly a home run though and Target did report weakness in other areas. For example, hardlines decreased in the upper single-digit range and the home category, a traditional strength of Target, declined in the low to mid single-digit range.
Looking ahead to March, the company noted the late arrival of Easter this year will cause sales to shift to April and causing March comps to decline in the mid to upper single-digit range. Conversely, April results are forecast to benefit and be in the mid-teens. The blended same store sales performance for the two months is forecast in low single-digit territory.