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Target cutting back on store remodels as it focuses on COVID-19 essentials

Food and household essential sales have surged.
Target store inside

Target is cutting back on its plans to remodel stores and open new smaller-format locations as it reacts to the coronavirus.

The Minneapolis retailer says it has seen its comparable sales surge by more than 20 percent so far compared to last year, with sales in its food, drink, medicine, and household essentials up more than 50 percent as Americans have stocked up for extended stays at home.

Despite this, the company has warned that its profits will likely be tighter than usual as its higher-margin departments such as apparel have seen sales dip, while it is spending more money doing deep cleans of its stores.

With grocery stores and pharmacies the only retail stores consistently open across the country, chains are under extra pressure to restock shelves.

To that end, Target has said it will be making changes to its strategic plans for the year, which had originally included remodeling 300 of its stores nationwide, as well as open 36 of its small-format stores.

But Target is scaling back on these plans so only 130 remodels will take place, with all other remodel projects pushed to 2021. As for small-format stores, Target will only open 15-20 of them.

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"We are prioritizing the work that’s in front of us to support our team, store operations and supply chain as families across the country rely on Target for everything they need in this challenging environment. I want to thank our entire team for their efforts, which have been nothing short of heroic," said Target CEO Brian Cornell.

"Over the past few weeks we’ve experienced an unprecedented surge in traffic and sales, as guests rely on our stores and same-day services. Ensuring we can take care of our team and deliver for the millions of guests who are counting on us remains our top priority."

Target last week announced it would be giving its hourly staff members a $2 raise during the COVID-19 crisis, as well as a one-time bonus to its store team leaders.

The Bullseye is also offering paid sick leave for its workers most at risk from coronavirus, including the pregnant, immuno-compromised, and over 65s.

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