What: Target is focusing on experimenting with new store formats, including smaller, closer to customers ones.

Why it is important: The strategy is fully centred on this store format even though, due to adjustments, some units will be closed this year.

Target experienced a nearly 3% increase in sales to $107.6 billion last year. Despite its success, the company constantly evaluates its store footprint, resulting in the closure of some locations. While the average Target store is 13,000 sqm wide, some 150 out of 2,000 are 5,000 sqm large.

Target will close four small-format stores, but the decision was based on individual performance rather than size. Analysts noted that store closures are not necessarily concerning, as good retailers routinely review their store portfolios: half of the stores Target plans to open this year will be smaller format stores, complementing its overall strategy.

Target's COO, John Mulligan, mentioned plans to invest in about 175 stores this year, including full remodels, shop-in-shop experiences, and retrofitted fulfillment spaces for same-day services. The company is also focusing on developing larger store formats in the future.

Target to close 4 small-format stores this spring