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

2. 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

3. 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.

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

5. 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

6. 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

7. 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

8. 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

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

10. 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

11. 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

12. 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 *
Total $344
2015: 50% growth rate increase
2015: P/E Ratio of 14.8
*39/79 Canadian stores, 290/967 American $1million per store

13. 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

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