Shortly after Toys R Us declared bankruptcy in March, the retail industry undeniably felt its ripple effect.
Job gains in the sector took a hit after 30,000 Americans were left without work, while mall vacancies climbed to their highest level since rebounding from the Great Recession. However, the toymaker’s demise has also left billions of dollars in holiday toy sales up for grabs as retailers like Target battle for its market share ahead of the biggest shopping season of the year.
Reporting third-quarter earnings this morning, the big-box chain announced that the toys category was among those that showed the strongest sales gains.
Early this month, the company reallocated a quarter-million square feet of space specifically for toys in more than 500 stores across the country. It also shared plans to update more than 100 of its remodeled stores with oversized displays that allow for interactive experiences as well as increase its toy inventory to double digits to accommodate products such as playhouses and electric ride-on vehicles.
In addition to experiential opportunities, Target is heating up the competition with Amazon and Walmart this holiday season by waiving its $35 order minimum for free shipping, along with adding free two-day shipping until Dec. 22.
For the quarter, the company saw net income climb to $622 million, or $1.17 per share, compared with $478 million, or 87 cents per share, in the same period last year.
Target also reported sales that increased 5.6 percent from a year ago to $17.82 billion, with same-store sales up 5.1 percent. Although the figures fell slightly short of expectations, the Minneapolis-based retailer maintained its profit forecast for the full year.
“We’ve made significant investments in our team heading into the holidays, and they are ready to serve our guests with a comprehensive suite of convenient delivery and pickup options, a wide range of new products and unique gift ideas and a strong emphasis on low prices and great value,” CEO and chairman Brian Cornell said in a statement.
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