David Gornitsky, Heather Bowles, Richard Ratkai, Austin Holmes, Gornitsky Group David Gornitsky, Heather Bowles, Richard Ratkai, Austin Holmes, Dan Nicoletti

Key Corporate Facts 2010 Sales: $65 Billion Strengths: Brand Name, Product Assortment, and ability to adapt to external environment Weaknesses: Rise in Write-Offs, higher prices than Wal-Mart, Reliance on China Major Competitors: Wal-Mart, JC Penny, and Kohl's

Current Mission and Vision Our mission is to make Target the preferred shopping destination for our guests by delivering outstanding value, continuous innovation and an exceptional guest experience by consistently fulfilling our Expect More. Pay Less.® brand promise.” To support our mission, we are guided by our commitments to great value, the community, diversity and the environment.

Current Company Strategy and Focus “Cheap-Chic” Focus on Design Broad Differentiation Strategy

SWOT Analysis Strengths Strong Brand Name High Product Assortment Weaknesses Higher Prices than Wal-Mart Reliance on China Opportunities Expansion of the Electronic Market E-commerce and M-commerce Threats Decline in Consumer Confidence Wal-Mart

Strategic Issues Look at potential changes in their: Mission Statement-shouldn’t change Vision Statement-might add green or home aspects Roadblocks somewhere in the value chain-integrating the two supply-chains might be difficult

New Stores and New Ideas Focus by Target Green or eco-friendly business structure Horizontal Integration Acquire Pier 1 Imports Inc. Improved Brand Image Splitting product lines Local Manufacturing Completion of Strategy in 2015 Struggling company in which it may be willing to sell

External Analysis Trends: Green, Buy Local Key Porter’s forces in play Power of Suppliers Threat of Substitutes Threat of New Entrants Incumbent Competitors: Local/Regional Furniture stores National Positioning

Key Success Factors Top Three KSFs Consumer Confidence Positive Housing Market Proximity of Stores to Key Markets Our 800-pound Gorilla IKEA

SWØT Strengths Experienced workers Improved Brand Name/Image Weaknesses Only one approach to market Low Quality Perception Threats New set of Competitors Housing Market Fluctuations

Opportunities With an existing employee base familiar with the industry, lag time will be reduced Room for innovation and improvement in the quality of the product offering While the housing market as a whole has been struggling the Green market has been growing

The Plan to Purchase Pier 1 Imports Buy Assets for approx. $307 million (based on EBITDA Book Value Multiple) ¼ in Cash, rest in Bonds (A2 Rating) All other costs, leveraged capital: (in millions) Marketing $15 Store Remodeling 329* Total $344 2015: 50% growth rate increase 2015: P/E Ratio of 14.8 *39/79 Canadian stores, 290/967 American stores @ $1million per store

Strategic Objectives Differentiate and Expand Product Line As the credit holdings are sold Pier 1 is acquired then by 2015 open initial stores Wider base of customers Increased bottom lines from a higher margin business development

Potential Fallout: Pier 1 Imports Inc. collapses financially after buy-out Consumer Unresponsiveness Failure of Focus Stores Imitation by Competitors (Costco)