Target (TGT) shifts payroll to stores, cuts ~500 distribution and regional roles to boost service

Headline: Target refocuses payroll to stores, trims distribution and regional roles to improve guest experience

Stores First: Target redirects payroll to fix shelves and service

Target is shifting payroll toward frontline store hours and guest‑experience training while eliminating roughly 500 jobs in distribution centers and regional offices, the company says. In an internal memo, executives say the move reduces the number of store districts that oversee nearly 2,000 stores and reallocates resources to address shopper complaints about sloppier shelves, out‑of‑stock items and longer checkout lines. The changes include about 100 position reductions at the store‑district level and about 400 cuts across supply‑chain sites.

The memo, written by chief stores officer Adrienne Costanzo and chief supply chain and logistics officer Gretchen McCarthy, says the reorganization “fuels our ability to put significantly more payroll in our stores,” although a company spokesperson declines to disclose the total additional investment. Target says starting wages remain within current ranges of $15 to $24 per hour, and the moves are positioned as operational rather than compensation changes. Executives frame the action as an immediate effort to improve on‑shelf availability and shorten lines that have tarnished the retailer’s guest experience.

The reallocation is one of the first operational steps under new chief executive Michael Fiddelke, who takes the helm this month after serving as chief financial officer and chief operating officer. Target says the shift is intended to reclaim strengths in customer service and trend‑forward merchandise that help define its brand, and to restore growth after years of stagnating sales and shopper frustration that have pressured margins and market positioning.

Merchandising and operations consolidated under two executives

Target also announces an executive realignment that consolidates merchandising and elevates operations to support the store focus. Cara Sylvester, formerly chief guest experience officer, becomes chief merchandising officer with responsibility for assortment, digital, loyalty and marketing; Lisa Roath, formerly chief merchandising officer for food, essentials and beauty, becomes chief operating officer to align merchandising, supply chain and stores. The company says the changes simplify reporting and speed decision‑making to advance assortment innovation, omnichannel execution and guest loyalty.

Context: sales flat and prior cuts

Target is taking the steps against a backdrop of roughly flat annual sales over four years and a previous round of about 1,800 corporate job cuts last year. Executives say the reorganization aims to restore growth and repair a brand reputation that shoppers and vendors say has eroded, with a focus on execution at the store level to win back customers.