Logistics management is one of the critical components that determine the operational efficiency and satisfaction of customers in any retail organization. Target Corporation is one of the biggest retailers in the United States, with an expansive network of over 1,963 stores across the country (Target Corporate, 2025). The target corporation’s logistics strategy encompasses a system of purchase, transportation, inventories, warehousing, distribution, and customer service for the company (Berman, 2023).The respective company has invested in new changes across all its supply chains, including up-to-date applications of technologies of Radio-Frequency Identification (RFID) for easy tracking of all its inventories and efficient warehouses strategically located at different points throughout the United States.
A key feature of Target's logistics strategy is the "Stores-as-Hubs" model, in which its physical retail locations act as fulfillment centers for online orders (Target, 2025). This enables faster delivery and lower shipping costs and supports a seamless Omni channel experience for customers.Target faces several disruptions in the supply chain and high levels of competition coming from e-commerce firms. Therefore, the SWOT analysis of the logistics system at Target will reveal insights into its existing strengths and areas that need enhancement. Additionally, applying a Balanced Scorecard methodology would provide an organizational framework for logistics performance improvement as the operational actions become aligned with strategic goals for the company.
According to Adeniran et al. (2024),logistics management is one of the most important functions in the retail industry because it helps move goods from the suppliers to the consumers.Effective logistics management is significant for Target Retail which can assist in crucial operations including, transportation, warehousing, inventory management, and order fulfillment. Vaka (2024) states that proper logistics management helps retailers maintain the ideal level of inventory, minimize costs, and respond to customer demand. For Target Corporation efficient logistics is determined as one of the key factors in customer satisfaction due to the timely availability of products in a retail competitive environment. This productivity contributes to higher sales and helps increase customer loyalty. It becomes an advantage over others in the marketplace. Therefore, logistics and logistics management are important elements of both organizational success and national economic development. For retailers like Target Corporation, the smooth running of logistics operations contributes to better customer satisfaction and operation efficiency. For a nation, solid logistics infrastructure and management support national economic growth, trade facilitation, and competitiveness in the world.
Target adopts Omni channel strategiesto handle their logistics operationsthat comes with strengths of an efficient distribution network and weaknesses which include limited reach, and data security issues. On the other hand, opportunities include the expansion of e-commerce as well as sustainability, and mitigating threats like intense competition along with supply chain disruptions.
A Balanced Scorecard framework can greatly improve logistics performance by systematizing the way operational activities are executed within the perspective of strategic objectives (Dwivedi et al., 2021). The scorecardis applied to Target Corporations that consider four perspectives in measuring the performance of the retail business including; Financial, Customer, Internal Processes, and Learning & Growth perspectives;
Scorecard Perspectives |
Objectives |
Key Performance Indicators (KPIs) |
Strategy |
Financial |
To optimize costs and enhance the profitability of Target retail within its logistic functions. |
Operating Ratio: 15% reduction in the overall operational cost resulting in a positive operating ratio with capital invested. Pick and Pack Costs: 20% reduction in the order fulfillment processes to find savings opportunities. |
To implement cost-effective transportation solutions. To optimize warehouse operations to reduce handling costs. Negotiate favorable terms with suppliers and carriers. |
Customer |
Improve customer satisfaction through better delivery performance and service quality. |
On-Time Delivery (OTD): To convert 50% of negative feedback to positive reviews of customers on timely deliveries of products and services. Order Accuracy Rate: To ensure the right product or service is delivered to Target’s customers. |
Implement real-time tracking systems to provide customers with visibility into their shipments. Improve communication channels to address customer inquiries and issues promptly. Develop a robust returns management process to handle product returns efficiently. |
Internal Processes |
To streamline internal logistics processes to improve efficiency and reduce cycle times. |
Order Fulfillment Cycle Time: To ensure the supply and demand of products are coordinated. Inventory Turnover Rate: To maintain an ideal inventory turnover rate between 5 and 10. |
Adopt automation technologies for order processing and inventory management. Implement demand forecasting tools to maintain optimal inventory levels. Conduct regular process audits to identify and eliminate bottlenecks. |
Learningand GrowthPerspectives |
To foster a culture of continuous improvement and innovation within the logistics team. |
Employee Training Hours: To monitor the amount of training provided to staff, ensuring they are equipped with the necessary skills. Technology Adoption Rate: To evaluate the implementation of new technologies aimed at improving logistics operations. |
Invest in regular training programs to enhance employee competencies. Encourage cross-functional collaboration to share best practices. Stay abreast of industry trends to adopt innovative solutions promptly. |
By adopting the Balanced Scorecard approach, organizations can gain a comprehensive view of their logistics performance, facilitating informed decision-making and strategic improvements that lead to enhanced efficiency, customer satisfaction, and profitability.
Supply-side logistics and demand-side logistics are essential parts of the supply chain for any firm (Wang & Song, 2023). They handle two different product' flows concerning the satisfaction level of customers.Supply-side logistics also known as Inbound Logistics is procurement and transportation from suppliers to warehouses or manufacturing places. On the other hand, demand-side logistics, or outbound logistics, is responsible for distributing the finished products of the company to the end customers or retailers.
The interrelationship between Supply-Side and Demand-Side Logistics
To design an efficient supply chain that responds positively to market needs, the sides have to integrate demand-side and supply-side logistics.
Coordination of all logistics activities is very essential and forms the platform for enhancing effectiveness, cost control, and quality customer service delivery (Dong, 2023). Integrated logistics unifies numerous supply chain activities that include purchase, transportation, warehousing, and distribution among others together in one whole system.
Key Strategies for Achieving Integrated Logistics at Target Retail Corporation;
Benefits of Integrated Logistics;
By developing the integrated logistics function, coordination of logistics activities would be achieved using strategies like cross-docking, JIT inventory management, real-time tracking, warehouse management, and IT integration, among others. This is then associated with more significant performance, greater savings, and excellent customer satisfaction- all elements that make an organization prosper in the dynamism of its market environment.
The feasible solutions will help Target Corporation maintain the satisfaction of the clients and provide operational excellence in logistics. The possible solutions to common challenges in logistics concerning customer service are as follows;
The key role logistics management plays in Target Corporation is that it enables seamless operations in the procurement, transportation, warehousing, inventory management, and customer service of the company. Based on the SWOT analysis, Target has a lot of strengths in its efficient distribution network and Omni channel capabilities, while the areas of improvement include mitigating supply chain disruptions and price perception challenges. Some of the essential solutions include real-time tracking, better customer communication, and improved last-mile delivery to enhance logistics customer service. The integration of supply-side and demand-side logistics enhances operational efficiency, while a Balanced Scorecard would offer a strategic approach to improvement in logistics performance.
To maintain and improve its logistics performance, Target Corporation should focus on the following recommendations;
Read Assignment 3's discussion paper to gain valuable insights and thorough analysis on the topic at hand. A must-read for in-depth knowledge....
Delve into cognitive development stages, key theories, and influential factors shaping human intelligence from infancy to adulthood....
Learn why transparency is crucial in digital marketing and how it can improve your brand's credibility and customer engagement....