Many of us view Target Department Stores as one of the most progressive American corporations. Target's web page explaining its Corporate Culture to new employees emphasizes its Culture of Inclusivity, valuing diverse voices and approaches.
However, there are limits, or at least there should be, to the assertion of our values. My "values," for instance, should end where your values begin. At least, that's been our country's approach to differing values since the nation began—my rights/values end, where they influence upon your rights/values.
Target takes another approach. For Target, some people's values must be upheld, even if they infringe on society's values.
Case in point, the ongoing bathroom dispute at Target. In one of the most widely ballyhooed corporate moves ever, Target decided that it would be their policy to allow transgender people, and people who identified with the other sex, to use whatever bathroom they wanted. In other words, Target took an active role in promoting the "values/rights" of some members of the LGBTQ community even when the traditional norms of society opposed those values/rights.
Target's Management had transformed the Company from a traditional vendor into a cultural advocate. No longer merely a store, Target now became a "social reformer." With all that implies.
The initial results were predictable. Transgender "men" were found in ladies' bathrooms, and children were subject to despicable and undesirable behavior. These instances all made headlines and even promoted a boycott of Target.
However, Target's Management team was committed to their cause: social justice. A course that Target has maintained to this day.
Here, we see the way modern American Corporations differ from the past. Historically American Corporations upheld traditional American values. They were the country's most significant "flag wavers" because this was the best way to maximize sales. A Sears Roebuck or Montgomery Wards would never dream of "reforming" society. Their job was to sell the most goods and products, not to be social warriors.
The fundamental Christian values of America were not to be challenged by Sears or Wards. A challenge by a single Church Pastor would be enough to send Sears into a tizzy.
Today, it takes something entirely different to send Management into a tizzy, and that's the bottom line. The all-important profit and loss statement is the defining instrument for today's Corporate Execs. On Wednesday, Target Corporation reported its third-quarter results.
Buried in the footnotes of their Financial report was the Note that Target has lost $400 million this year to theft. And they expect to lose an incredible $600 million by year-end 2022.
In their conference call, Target noted that they currently face substantial headwinds in their profits because of theft. What the retail industry calls whimsically "shrinkage." At more than half a billion dollars this year, that's quite some "shrinkage."
To put this in perspective, Target's "Shrinkage" (theft) equals 1.6% of Target's total profits. Or nearly three times the amount of Walmart's shrinkage level. Walmart's shrinkage is slightly over one-half percent.
Target views theft as their major impediment to profit growth.
Michael Fiddelke, Target's Chief Financial Officer, points out that the problem continues to grow. Each of the last three years' shrinkage was worse than the year before. From Fiddelke's point of view, this is "organized retail crime." Although he is not specific, Fiddelke promises they are taking the "right actions" to curb this problem.
But isn't "shrinkage" just the cost of doing business for a modern progressive corporation like Target? Shouldn't a certain amount of "shrinkage," say $500 or $600 worth, for the economically disadvantaged be allowed?
Shouldn't Target view theft the way the city of San Francisco does a fair distribution of goods among the poor and needy? After all, isn't theft merely an old antiquated value? One that likely needs changing. Just like Target allowed the socially oppressed to use whichever bathroom they wanted.
Hardly.
I wouldn't be surprised if we begin to see guards at Target someday soon. It is, after all, the great irony of untethered social "reform," once unleashed, can only be brought back in line with brute force, from open bathrooms to armed guards in just a couple of years.
Econ Briefs
Two interesting reports are coming out of Great Britain, first the good news. Retail Sales for the British Isles were up by 6/10th% in October. The Report was the year's first solidly positive retail sales report and doubled what analysts thought would happen.
Economists always like to see positive retail sales, which is a crucial indication that consumers are getting back on their feet and can provide some real momentum to the overall economy. However, this may be a different time. Oil Price dot com has just reported that Britain has the highest Electricity prices in the world. We've heard reports for a couple of months of monthly electric bills equaling a house payment in England.
Yes, Retail Sales are higher in Britain, but they're "buying" energy to heat their homes. You have to ask: How's that Russian oil and gas boycott working out for the Brits?
Elon Musk is finding it tough sledding over at Twitter. The multi-billionaire is transforming the nation's largest social media site, which is not going well. Last evening Musk gave Twitter employees a choice: they could sign on to the new, more balanced approach to Twitter broadcasts or take a severance package.
Well, so many took the package and quit that there needs to be more staff to open the Twitter offices this morning. It looks like Twitter will be closed until Monday. For Musk, Twitter is turning into a giant headache.
Yesterday saw Building Permits and New Home Starts decline slightly, and we expect the same for Existing Home Sales this morning. We will get the latest on Existing Home Sales later this morning. It's a tough time to be a Realtor.
A light day in earnings so far, retail store Foot Locker has reported very positive results, while bio-science company Twist Bio-science is currently trading lower on its results.
