Why Is Target Closing Stores? Data casts doubt on the company's implication that it's due to rising crime.
...the data does not point to any clear changing crime trend that would justify rapid closures of these five stores for specifically crime reasons. Given these trends I’m highly skeptical that rising crime at these stores is the main explanation for the store closures.
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My theory is that the above graphs are actually telling a deeper story. Those stores may not be closing in spite of lower levels of crime but rather because of them.
Crime isn’t good — obviously — but shopliftings at a store imply something about that store’s performance. That the stores that are closing have lower crime levels may suggest that they are seeing fewer customers than the other stores. The number of crimes isn’t just a measure of criminal activity, it’s also a measure of customers (NOTE: A few readers have pointed out that some of these stores are physically smaller than normal Target stores which certainly fits the data and is good context to have).
You can’t have pickpockets on Bourbon Street if there are no tourists around, so a ton of pickpocket incidents being reported can be taken as a sign of a rollicking good Mardi Gras.
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Unfortunately, crime makes an easy and simple boogeyman for complex decisions that may only be tangentially related to crime — if at all. We are fortunate to have open crime data that allows for a deeper dive into the factors that may or may not be impacting corporate moves such as this.
Anecdotally speaking as someone close to the one they're closing in SF the store really didn't make sense. It was too small to offer the variety of goods you want from target. For the stuff they did have they couldn't compete with other stores in the area. For groceries there's a Costco, trader Joe's and local coop close by that have more variety, and for electronics there's a Best buy across the street. Combine all that with competition with Amazon for misc. Home goods and they have no market.
Guess it's easier to blame theft then a failed business model, especially to shareholders.
isn't target the one that sells with low profit margin but has membership fees? or is that costco?
Costco is membership. Target is not.