How Target Leveraged its Direct Sourcing Strategy as a Competitive Differentiator

Executive Summary

In this report, we look at the key elements of Target’s direct sourcing strategy that have helped the company successfully build its collection of private labels.

• In the year ended January 2019, owned and exclusive brands accounted for around one-third of Target’s total sales.
• Part of Target’s success in private label has been building direct sourcing networks – especially from suppliers in China.
• Target has also focused for many years on sustainability initiatives that include operations, its stores and of course, supply chain – providing Target with the opportunity for greater customer loyalty as consumers expect retailers to be socially responsible (in an ESG, Environmental, Social and Governance framework).