Target reported Q4 2020 earnings. A few tidbits that are interesting to me.

• 2020 stores fulfilled 95% of total sales. $4B expected to be invested in each of the next few years in store remodels, upfitting, and supply chain.

• Small format stores are going to continue to be a focus. 30-40 expected per year in the next several years. (This is not new, but consistency in strategy is nice to see in a company). They only had 30 small-format stores in 2016; now there are 140+.

• Over 10 Target house brands are now $1B+ run-rate. 4 of these brands over $2B. These brands represent 1/3 of Target’s sales and an even greater % of their profit. That is really good for their trajectory, uniqueness, and margin. All of these things are necessary for them to compete with Walmart and Amazon.

• Ulta Beauty coming to Target's stores and website. I find this super interesting, particularly since beauty has historically been an under-penetrated category online.

• CEO had a long digression about not following the Amazon "ship to home" model. Two reasons - poor economics and lack of differentiation. Those are extremely good reasons. I have a lot more to say about this. Target says 40% less than if shipped from a warehouse.

Nate Skiver found the “sortation center investment interesting as well, making the portion that they do deliver to home more efficient. Depending on throughput and pickup capacity, perhaps they can incorporate Shipt customer volume here as well.” He also noted admiration for “the college campus store focus as well, acquiring customers just before they begin really earning and spending.”

Stefanie Smith also read the transcript and was impressed with what she was reading. “It's a master class in bold clear vision, strategy, alignment, disciplined execution and unwavering commitment to the customer.” She also noted that Target has “a continued focus on affordability, becoming more relevant and welcoming for Black guests, and ambitions to adjust staffing strategies for more predictability for the team.” Stefanie also pointed out “the consistent praise from all presenters of the team members that make everything happen.”

That last part - the focus on the team members - is one of those things that somehow feels genuine from Target leadership.