It has been less than a year since Target tightened the attendance policy for some of its corporate employees, but the Minneapolis-based retailer is again ratcheting up those in-office requirements as it tries to reverse a yearslong sales slump.
The company will soon require workers in its merchandising division, one of its largest, to show up at least four days a week, Chief Merchandising Officer Cara Sylvester told employees this week in a memo viewed by CoStar News. The updated mandate is scheduled to take effect the week of Sept. 6, with workers choosing which days they will make the commute.
"Target is focused on getting back to growth with a clear set of enterprise priorities that include leading with merchandising authority," a company spokesman said in a statement. "Spending more time together in person has enabled faster decision-making, stronger partnerships and enhanced opportunities that help us deliver on our strategy."
The decision lands as the days of pandemic-era workplace flexibility continue to wane.
Target took steps last year to end its flexible work policy after half a decade. It began asking employees across the merchandising division — made up of buyers, planners and other employees responsible for selecting products, managing inventory and shaping the retailer's inventory — to return to its headquarters in downtown Minneapolis at least three days a week.
It was the company's first department to adopt a uniform in-office requirement, one that is now set to escalate as Target scrambles to improve its merchandising operations and turn around declining sales.
While it reported its strongest quarterly sales gain in years in May, it acknowledged the uphill effort required, which has meant a significant boost in spending to introduce new products, improve store layouts and upgrade some of its older locations.
Turnaround push
It has also meant pushing its employees to show up more regularly, a strategy that echoes those adopted by other companies pursuing a broader turnaround.
Companies nationwide are demanding more in-person time from employees, either by revoking flexible work privileges, increasing the number of days they're required to be in an office or asking a portion of the workforce to move closer to a corporate hub.
Some of the country's largest landlords have said that stricter in-office mandates are enough to bolster optimism that demand for space will climb as big corporations push to revert to their pre-pandemic workweek schedules.
The number of CEOs who believed their companies would adopt a full return to a five-day workweek climbed to about 85% from the 64% reported in 2023, according to a KPMG survey.
Hybrid mandates have plummeted from about 80% to roughly 40% over the same period, and only 1% of companies continue to allow fully remote policies, according to a JLL survey.
Target's heightened mandate is expected to deliver a welcome boost to the Minneapolis office market after years of declining occupancy and sluggish demand.
The city's downtown vacancy rate has surged to nearly 24.5%, according to CoStar data. Companies such as Target offloaded about 1.2 million square feet more than they took on over the past year, pushing the amount of available office space beyond 11 million square feet.
Yet heightened in-person requirements could provide a backbone of stability for the market after hitting a nadir.
Along with Target, other major Minneapolis employers such as General Mills, Best Buy, 3M and Ameriprise Financial have rolled out new or escalated policies in recent months.