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So many Targets to choose from; an executive’s firing gets buried

Thursday was a busy day for reporters on the Target Corp. beat. The company announced what the Star Tribune termed on its front-page a “bold” push into Canada — its first-ever foreign expansion. Word also broke that Target again wants to sell $6.7 billion in credit card receivables.

And oh yeah, the company disclosed it had fired the senior executive in charge of its stores.

All three stories are unquestionably news, but only the first two got any real traction.

For example, the Strib’s Jackie Crosby — who had to be panting a bit yesterday — made the front page with the Canada story, and the business front with the credit card story. But when Big Red “terminated” executive vice president/stores Troy Risch, that rated small type in the business section’s “company roundup.”

Similarly, the Pioneer Press splashed the Canada news on its business front, using a New York Times story; the Times didn’t mention credit cards or Risch.

The Risch news appears to have come from a Thursday Securities and Exchange Commission filing that noted the ex-exec would got Target’s “standard officer severance agreement” plus a million bucks if he doesn’t jump to a competitor.

However, Target spokeswoman Amy Riley says the company issued a statement that Risch’s successor, Tina Schiel, had been promoted via P.R. Newswire on Tuesday. While the information didn’t appear on Target’s media site until Thursday, the Minneapolis-St. Paul Business Journal did have a Tuesday story that — like the company’s release — didn’t mention Risch’s firing.

Not unexpectedly, Riley won’t say why Risch was terminated. That won’t stop speculation that Risch’s firing was related to Target’s December revenues, which “fell well short” of expectations. (Crosby’s reporting on the numbers is included here.)

I can’t fault the Strib for emphasizing the Canada news (which could create jobs at the headquarters here) or the credit card story, which could be a big deal to the company’s financial health. Target’s disappointing sales had already made the papers, but hopefully we’ll get more on the Risch backstory once the dust settles.

Comments (11)

  1. Submitted by Mark Gisleson on 01/14/2011 - 02:53 pm.

    I hope Mr. Risch’s successor immediately ends Target’s insane anti-customer policy of using different floor layouts in each of their stores. Know where the cookware is at the Roseville Target? Won’t do you any good if you’re shopping in Edina or Midway because each store is laid out differently on purpose. What that purpose was no Target employee could ever explain to me but I’m pretty sure it was part of the school of thought that calls for making stores hard to get through so you spend more time there and maybe spend more money.

    Because Target really didn’t care if you were in a hurry to get home after work or if you were paying a babysitter by the hour.

  2. Submitted by Neal Gendler on 01/14/2011 - 03:12 pm.

    I’d be very surprised if the Strib doesn’t do some kind of piece on Risch’s dismissal,although a condition of his severance could be his silence. Meantime, thanks for cutting Jackie some slack; she’s an extraordinarily good reporter and hard worker, and the Risch thing could have come up late in the day. And unless things have changed, extracting information from Target — especially if Target doesn’t want to disclose it (“We don’t discuss personnel matters” may be the company’s only response) — is a major effort.

    In order of yesterday’s Target news importance, Risch’s firing is a definite No. 3. You get something in print, then hit on the story the next day.

    And Risch? Severance *plus* a $1 million non-compete? Gee, that’d set up most of us for life! (Target could fire me for half that much and I’d be happy.) To paraphrase Liberace, I’m sure Risch will be crying all the way to the bank.

  3. Submitted by Greg Kapphahn on 01/14/2011 - 05:07 pm.

    Target’s poor December performance may be related to the fact that it was revealed, just as the holiday shopping season was ramping up, that those who spent money at Target were continuing to unwillingly and unwittingly support very conservative causes with which many of them disagree.

    I, for one, had assumed Target had wised up, but upon finding out that they continued to contribute massively to things I oppose, didn’t spend a penny of holiday money there.

    Of course it could also be that my local Target (one of the smaller ones) now carries a far smaller range of merchandise. Whole categories have disappeared from the shelves.

    At this point, there are very few reasons to go TO my local Target store and far too many reasons NOT to.

  4. Submitted by Dave Callaway on 01/15/2011 - 01:08 am.

    I have to agree with (#3), above.

    Some one prominent (Risch), had to take the fall for the poor numbers! Pres. and CEO Steinhafel has his his head so far up in the clouds, (or somewhere else), that he couldn’t have been the problem.

    Maybe the Board of Directors should / will take a closer look (?). If the numbers continue to lag behind expectations, they would be doing the stockholders a disservice and shirking their fiduciary responsibilities, not to!

    The news of the Canadian expansion, is probably more about glossing over the poor performance and the hit Target will take if they are able to sell $6.7 billion in credit card receivables. Then again, Canada isn’t in quite the financial trouble, as the U.S.

    Why is Canada doing better, one might ask?
    Well, they didn’t deregulate their banking and financial laws. They know a casino when they see one, and didn’t take the bait! The only reason their economy is down, is because
    their main trading partner, (the U.S.), is in the tank and not coming out any time soon. We turned our financial system into a casino, and you know, the casino always wins!

    A special thanks for our predicament goes out to Bill, Larry, Phil, Allan, and many others, all stooges for the casino…..

  5. Submitted by Mark Heuring on 01/15/2011 - 10:46 am.

    I worked at Target for nine years. A couple of things:

    1) Target does try to make their store layouts similar, but there are several prototypes out there. The Roseville SuperTarget is unusual, because it’s a smaller footprint than a typical SuperTarget. From my experience, it’s a bit of an outlier. Where you see the greatest variations is in stores where space is limited; Roseville is a perfect example of this. When Target puts a store up in a cornfield, layouts are quite simlar from store to store.

    2) When sales fall below expectations, store execs aren’t usually the ones who get the ax. In most cases, the merchants are the ones who feel the heat. The most dangerous job at Target is being the toy buyer. I’m not privy to why Risch was canned, but if we ever find out the real reason, it probably won’t be store performance. From what I could tell, the stores operationally have been pretty steady in recent years. Service at a Target is still far superior than what you get at Wal-Mart. If there were problems, my guess is that the merchandise mix was wrong. The stores can only stock what the merchants buy.

    3) From what I’ve heard, the financial impact of the controversies over Target’s political moves has been pretty much negligible. I’m sure they deeply regret Greg’s lack of patronage, although they’ll probably replace his money in the next 20 seconds or so.

  6. Submitted by Dick Novack on 01/15/2011 - 12:49 pm.

    Mark Gisleson, maybe you just don’t get around enough.

    I’ve been to Targets around the country that have very close formats to each other although due to building type/shape/size there seem to be variations. But that is also true of Walmarts. What is always different for all of those is product selection tailored to the locals. Produces and PRICING can be really different (just compare Southtown, Southdale, Knollwood, Ridgedale – just miles apart). BTW prices are universally higher at Knollwood.

    Product mismatch to locality could be a big reason for poor sales and the Risch firing. E.G. we could not find more than two styles of leggings here in October (not because they were out) but found counters-full in Nashville Targets 2 days later.

  7. Submitted by Lynda Friedman on 01/15/2011 - 02:41 pm.

    Greg, Thanks for pointing out an obvious cause of poor December sales for Target. I was among the people shocked to be told the corporate political donations were guided by the personal philosophy of the main exec and his family and continued to be after objections from customers. Not what I expect from a public company. A once loyal Target shopper, I quietly found other places to spend money. Seems many others did too. Would love to see a story with some research by a business reporter about the facts behind the poor sales.

  8. Submitted by Paul Udstrand on 01/16/2011 - 12:57 pm.

    //From what I’ve heard, the financial impact of the controversies over Target’s political moves has been pretty much negligible. I’m sure they deeply regret Greg’s lack of patronage, although they’ll probably replace his money in the next 20 seconds or so.

    Mark, ya can’t have it both ways. You can’t acknowledge that sales are down and dismiss patronage (like Greg’s). We all have alternatives to Target, and I doubt that Greg is the only one who either not shopping here or shopping there less. I know my enthusiasm for Target has taken a plunge because I don’t like the idea of their or any CEO taking my money and spending using it to support bigotry and intolerance. I’m not engaged in a full on boycott, but my spending at Target has gone down. Maybe they can make up for it in 20 seconds… as long as there aren’t too many people like me out there.

  9. Submitted by Mark Heuring on 01/18/2011 - 12:20 pm.

    Paul, I’m not having it both ways. Most people are pretty much apolitical when it comes to such things. What does matter is assortment, as Dick points out. The merchants have to figure out what is going to sell and then the logistics people have to get it to the stores.

    Best Buy had a terrible year and they weren’t involved in any political controversies. They had the wrong merchandise in the stores, or they had it priced too high. Or both.

  10. Submitted by Annie Grandy on 01/18/2011 - 09:03 pm.

    Mark Heuring – “Best Buy?” They contributed to the same MNForward conservative campaign Target did and I, for one, boycotted both of them and will continue to do so. I also boycott any public place with a TV that will not turn off the Faux channel. I do it and I talk with all my friends, family and acquaintances and encourage them to do it. Many have agreed with me and have joined the boycotts. Word of mouth is a powerful tool – you may not agree but it looks to me like we had an affect on the bottom line of these out-of-line retailers. Yay!
    Sorry Mr. Risch that you paid a personal price for your CEO’s misjudgement.

  11. Submitted by Mark Heuring on 01/22/2011 - 04:15 pm.

    I’m not going to dissuade anyone here, since it seems to be an article of faith that these boycotts had an effect. They don’t. Walmart is under constant siege from many different groups and individuals for their behavior and they continue to sell more each year. And Walmart does it by bringing items to market in the most efficient and cost-effective way possible and passing on the savings to its customers. Believe what you’d like, but it doesn’t change the way the retail business operates.

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