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We Need More Eggs

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Target Case Study: We Need More Eggs!

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Introduction Target, a nationally known Fortune 500 company, is continuing to grow in both store size and numbers since its first opening in 1962. Target is extremely customer oriented and not only serves its guests with low prices, but quality products. The company is focused on innovation and creating the best experience possible for its guests. Currently, Target is in the process of implementing its “P-fresh” roll out; adding a grocery section to many existing stores as well as brand new stores. One of the problems that Target is facing with the expansion into the grocery sector is that the corporation is completely new to this ‘perishable product’ category and its employees have no past experience to internally benchmark solutions for varying demand, logistics/forecasting and stock-outs emergencies from. This case study will address the following question: “How can Target drive accuracy and efficiency in our supply chain in order to drive season in-stocks at our stores while reducing inventory levels at the DC?”. The particular problem that will be discussed is in dealing with a strategy pertaining to keeping eggs in stock during the extremely high fluctuation in demand during Easter. The complexity of seasonal in stocks has been made even more difficult as eggs must be kept refrigerated and many stores do not have extra room for in-store inventory. It is also important to note that while eggs are not a high profit category, they are a customer driver and are always found in the back of the stores to drive customers to see more products and increase their likelihood of impulse purchases. When solving a problem like this many things need to be taken into consideration. Some primary issues are: the amount of storage space at the stores, the cost of

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