In February, Target announced to its suppliers that major changes are coming to its compliance policies. In just under three weeks, Target will roll out its new Supplier Performance Management Compliance Policy¹. Target’s SPM policy will only affect domestic merchandise vendors and focuses on “operational excellence.” That term might ring a bell for Walmart suppliers after the retailer implemented its own Supplier Quality Excellence Program in 2021.

Like SQEP, SPM introduces the idea of “defects,” focusing on Advance Ship Notice (ASN) standards and barcode accuracy. The performance goal is pretty stiff at 100%, but don’t fret yet—there is a minimum threshold your defects must reach before you start to see fines. The ASN must be both available and accurate, or Target will levy fines at 75¢ per non-compliant carton. While the threshold is $100, ASNs not in A status (i.e., not accepted) have no minimum. Likewise, the fines are the same for illegible or unscannable barcodes.

All of this comes as Target suffers a ten-week foot traffic decrease². Nationwide boycotts seem to have affected Target stores, and its stock has slumped to a four-year low³. Additionally, Target salaried employees saw an 87% bonus cut⁴ after sales were down in FY2024, and Ulta has stopped its expansion⁵ into more stores for now. Target is banking on Easter sales to bolster its earnings, but over 150,000 consumers⁶ have pledged to boycott the retailer for the 40 days of Lent. With a 60% probability of a recession⁷, consumers are also spending less on discretionary items⁸, which make up more than 70%⁹ of Target’s sales.

All of that sounds pretty scary, but by creating a resilient supply chain and implementing compliance guidelines, you can avoid these impacts on your bottom line and focus on building your business. 

Want to learn more about being a resilient Target supplier? Let’s chat.