Food Sales at Target on Path to Hit $20 Billion

Look for food sales to account for a larger share of TARGET CORP's revenue in future years from the current 20%, as the Minneapolis-based retailer remodels more stores, notes The FOOD INSTITUTE in a recent food industry report.

Look for food sales to account for a larger share of TARGET CORP’s revenue in future years from the current 20%, as the Minneapolis-based retailer remodels more stores, notes The FOOD INSTITUTE in a recent food industry report. Target says it will remodel 75% of its 1,764 total units by year’s end and continues to increase its focus on food and beverage offerings.

Citing a CITI INVESTMENT report, the FOOD INSTITUTE estimates that one-fifth of Target’s sales would have been nearly $14 billion of its $68 billion in sales in 2011, which would have put it among the nation’s top ten food retailers. That one-fifth share attributed to food is sure to increase as a result of the remodels and increased food offerings as the retailer expands its P-Fresh format. In addition, the retailers move into more urban areas with smaller stores will likely add even more food sales . Furthermore, the chain is expected to open about  25 new stores in 2012 reported About.com. If all these expectations are met, that could mean Target’s sales from food could approach $20 billion in the future, according to FOOD INSTITUTE projections. If realized that could make Target the nation’s seventh largest retailer of food products.

Meanwhile, THE FOOD INSTITUTE previously reported WAL-MART’s sales from food were about $175 billion last year, from 4,479 units (including SAM’S CLUBS).  That means these two retailers combined could account for one-fifth of a trillion dollars in sales from food in coming years — the equivalent of 40% of the $519 billion in sales rang up at all of the nation’s supermarkets last year..

In a related development, Target is now the largest retailer to offer its shoppers the shopkick app via their smart phones. When consumers walk into Target, shopkick rewards them with points known as "kicks." Then, as guests shop, they have the opportunity to scan products to be redeemed for several things, including Target gift cards and dining gift certificates.

For more, read the FOOD INSTITUTE REPORT, and see the association’s website at www.foodinstitute.com.