Target Commits to Black-Owned Businesses

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Retail behemoth Target Corporation’s recent announcement that it has committed to spending more than $2 billion by 2025 on products and services from Black-owned businesses, including ramping up the number of minority-owned brands on store shelves and to at least 500, is setting a new bar for what it means to be a retailer in an era when racial justice and equality are front and center in American national discourse. The mega retailer also announced that it would engage with more advertising, marketing, and construction companies owned by African Americans as well as establishing a program to help Black-owned startup businesses. It’s likely not a coincidence that Minneapolis-based Target – home to some of the most high-profile cases that have spurred much of the national conversation about systemic racism and in particular how it relates to matters of policing, including, notably, the killing of George Floyd and most recently the shooting death of Daunte Wright – is leading the sector’s foray into supporting Black business.


The Red Bullseye is not alone in the effort to use its reach and economic heft to lift up Black businesses.  Ulta Beauty (a 2020 Robin Report Retail Radical) is the largest beauty retailer in the U.S. with an expansive physical and online presence is going all-in on diversity. The company recently committed to investing over $25 million to support an array of initiatives focused on promoting products aimed at and made by women of color as well as adjusting in-store merchandise assortments so that products catering to Black consumers are more readily visible and creating a more welcoming in-store experience for customers and workers of all backgrounds. Former CEO Mary Dillon named Black-ish star Tracee Ellis Ross to drive these changes and serve as the brand’s diversity and inclusion advisor.

[callout]The Target initiative is a shot of adrenaline into the arm of a Black-owned retail supply chain that will have far-reaching ripple effects across the entire retail landscape, driving innovation and scaling new brands with a more diverse ownership base.[/callout]

Target’s moves are even garnering attention overseas. The CEO of Brazil’s Magazine Luiza corporation which has over 1,200 retail locations and a vast constellation of digital, financing, and insurance businesses, was impressed by Target’s bold commitment to support Black-owned businesses. “Large-scale retailers be they primarily in-store, digital or omnichannel, have literally millions of touchpoints with consumers on a daily basis, and with that comes an obligation to harness that power for social good,” remarked company head Frederico Trajano in speaking with The Robin Report. Magazine Luiza, which is known across Brazil as Magalu, made headlines of its own last year by repositioning the company’s coveted executive leadership trainee program such that the 2020 class would only admit applicants of color. “Target is smart to use its scale to send a strong social message. Target will likely find, as we have here in Brazil, that investing in diversity and underserved communities is not only the right thing to do, but it makes good business sense as well,” added Trajano.

Scaling Up

What is significant about the Target’ announcement is the sheer scale of the commitment over a relatively short period of time. Over the course of the next four years, Target will deploy at least a half a billion dollars a year in supporting change and growth across the sector. In all likelihood, many of these Black-owned business benefitting from Target’s initiative will flourish and expand beyond the confines of simply Target. Put another way, the Target initiative is a shot of adrenaline into the arm of a Black-owned retail supply chain that will have far-reaching ripple effects across the entire retail landscape, driving innovation and scaling new brands with a more diverse ownership base.

Raising the Bar

But the most important aspect of how this story is unfolding is the new bar that the Target effort has set in the retail industry – one its main competitors will not be able to ignore for long. Walmart, for example, has a program for fostering and incentivizing a diverse supply chain, but it lacks specifics and now comes across as a bit wishy-washy when compared to Target’s laser-like efforts. Walgreens’ supplier diversity program aims to “[m]aintain a policy to utilize a minimum of eight percent certified minority business enterprises and two percent other certified diversity enterprises” in an effort to “…procure relevant products and services from diverse owned and small businesses that mirror the diversity of the communities in which [it] operate[s].” With a nation that is now nearly 40 percent non-white, it seems Walgreen’s ‘mirror’ could use some polishing.

None of this is meant as an overt criticism of any single retailer. Walmart, Walgreens and many others have just as much access to demographic data as anyone else, and their executives are fully capable of understanding that the historical nature of the moment our country finds itself in and are certainly determined to be on the right side of history. The only question is how fast they can get there on their own.

With Target’s recent commitment to investing in Black-owned businesses, the pressure is on.



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