Target getting fresh with food

There's been a lot of talk about lately about limiting the number of products sold at retail, with stores trimming assortment and dropping national brands in favor of lower priced private label products. But that doesn't mean retailers are totally lacking in innovation.

Target Stores may be opening a mere 10 stores this year, but it is remodeling 350 to expand fresh food departments and make it easier for shoppers to get most of their necessities at Target. The format is called "PFresh" and adds about 1,500 sq. ft. of perishables including produce, meat and dairy to typical discount store.

It's not quite a full grocery store assortment or the size of a SuperTarget or similar supercenter, but it's a significant change for Target. And an attempt to get its customers to visit more often.

Target shoppers frequent the store less than Wal-Mart's customer base, and spend less on food items. Target's own success is partly to blame. By making itself a destination for cheap and chic home goods and apparel, consumers don't consider it as much of a source for daily items as other stores that carry food.

So PFresh represents a pretty significant investment on Target's part. The company says it will spend about $1 billion to remodel stores this year and will continue into 2011 and 2012. This follows the conventional wisdom in retailing, but whether this gets customers into stores more often and spending more on food remains to be seen.