Target 2012 Annual Report Download - page 25

A significant disruption in our computer systems could adversely affect our operations.
We rely extensively on our computer systems to manage inventory, process guest transactions, service REDcard
accounts and summarize and analyze results. Our systems are subject to damage or interruption from power
outages, telecommunications failures, computer viruses and malicious attacks, security breaches and catastrophic
events. If our systems are damaged or fail to function properly, we may incur substantial costs to repair or replace
them, experience loss of critical data and interruptions or delays in our ability to manage inventories or process
guest transactions, and encounter a loss of guest confidence which could adversely affect our results of operations.
If we do not effectively execute our plan to expand retail store operations into Canada, our financial results
could be adversely affected.
Our 2013 entry into the Canadian retail market is our first retail store expansion outside of the United States. Our
ability to successfully open the expected number of Canadian Target stores on schedule depends, in large
measure, upon our ability to remodel existing assets, build our supply chain capabilities and technology systems
and recruit, hire and retain qualified team members. In addition, our ability to offer the expected assortment of
merchandise in certain markets may be impacted by the availability of local vendors of certain types of goods. The
effective execution of our Canadian retail store expansion is also contingent on our ability to design new marketing
programs that positively differentiate us from other retailers in Canada, and achieve market acceptance by
Canadian guests. If we do not effectively execute our expansion plan in Canada, our financial performance could be
adversely affected.
A disruption in relationships with third parties who provide us services in connection with certain aspects of
our business could adversely affect our operations.
We rely on third parties to support a variety of business functions, including our Canadian supply chain, portions of
our technology systems, multichannel platforms and distribution network, and extensions of credit for our 5%
REDcard Rewards loyalty program. If we are unable to contract with third parties having the specialized skills
needed to support those strategies or integrate their products and services with our business, or if those third
parties fail to meet our performance standards and expectations, our reputation, sales and results of operations
could be adversely affected. In addition, we could face increased costs associated with finding replacement
providers or hiring new team members to provide these services in-house.
Item 1B. Unresolved Staff Comments
Not applicable.
9
PART I