Target has been in business since 1962 when they opened up their first store in Roseville, Minesota. 1962 is the year that Wal-Mart was founded as well. The main objective for Target at that time was to provide great quality retail products that could match the service, price and value through continuous innovation. Those objectives are still present in the mission statement to this very day. They are currently the 2nd largest discount retailer in the country behind Wal-Mart and currently operate over 1,785 Target and SuperTarget locations in the United States and Canada. The head of Target is President & CEO, Greg Steinhafel. Mr. Steinhafel began his career with Target as a merchandise trainee and was able to move up the ranks. He became President of the corporation in 1999. Target currently has 3 major business segments that it operates. These are 1. U.S. Retail
a. This involves the brick & mortar retail locations as well as www.target.com 2. U.S. Credit Card (RedCard)
b. Customers have the ability to sign up for a debit card or a credit card depending on their lifestyle needs. 3. Canadian Segment
c. They have only been in Canada as 2012 after purchase of a leasehold interest from Zeller, Inc. Build-A-Bear workshop has been in operations since 1997 when they opened their new store in St. Louis, Missouri. The head of their operation is Maxine Clark, who is the founder and Chief Executive Bear. The objective of the organization is to provide an interactive retail environment that is dedicated to customizable teddy bears. Customers can choose from an extensive assortment of merchandise including different styles of animals to be stuffed. The animals are then customized by a variety of clothing, shoes and accessories. They have a strong online presence with buildabear.com, which is its online store, and bearville.com, which is an interactive online portal in which visitors can play games and safely chat in the virtual community. They also have strategic product licensing agreements with the NBA, MLB, NFL, Disney, Justice Clothing and the list continues. Build-A-Bear has 3 reportable business segments. Those are: 1. Retail
a. Brick & Mortar locations in the United States, Canada, United Kingdom, Ireland + including its online store 2. International Franchising
b. Licensing activities of its franchise agreements with locations in Asia, Australia, Africa, The Middle East and Europe 3. Commercial
c. Transactions with other business partners, mainly focusing on licensing of intellectual property / entertainment properties for 3rd party use
As of April 8, 2013, the stock price was at $69.49. Target had sales of $69.87 Billion in 2012 with their net income at $2.93 Billion. Their Earnings per Share came in at $4.31.
As of April 12, 2013, the stock price was at $5.03. Build-A-Bear Workshop had sales of $380.94 Million in 2012 with their net income at -$49.3 Million. Their Earnings per Share came in at -$3.02.
Target Company Selection
Target is on a mission to be #1 in the field of discount retailers. It is tired of being in the shadows of Wal-Mart. The objective was to be acquire a company that would add value and at the same time be able to line up with the mission statement that Target is most proud of. Other Companies of interest were: 1. Enesco, LLC
2. Vermont Teddy Bear, Co.
Enesco, LLC is a relevant player in giftware but doesn’t have the sufficient volume of sales that Target was looking for. They also filed for Chapter 11 bankruptcy in 2008. Vermont Teddy Bear, Company has an excellent product but they don’t have the capability to customize as Build-A-Bear can. They also deal primarily in an online space and focus heavily on catalog sales. Ganz offers many different styles of gift offerings but they just don’t have enough brick & mortar...