Target CEO Brian Cornell Denies Price Gouging Amid Inflation Accusations, Highlights Retail’s Tight Margins
Target CEO Brian Cornell firmly denied accusations of price gouging in the retail sector during a recent interview, emphasizing that the highly competitive nature of the industry leaves little room for excessive pricing. Speaking on CNBC’s “Squawk Box,” Cornell responded to recent claims, including those from Democratic presidential candidate Vice President Kamala Harris, who proposed a federal ban on corporate price gouging in the food and grocery industries.
Cornell was unequivocal in his defense, stating, “We’re in a penny business,” to highlight the narrow profit margins that characterize the retail sector. He noted that in today’s market, customers are quick to seek out the best deals, often comparing prices across multiple platforms before making a purchase. This behavior leaves retailers with little choice but to remain responsive to consumer demands or risk losing business.
The discussion comes at a time when inflation and high prices have become pressing concerns for consumers and companies alike. Despite the economic challenges, Target recently exceeded Wall Street expectations for earnings and revenue, though the company maintained a cautious outlook for the full year. Cornell acknowledged the delicate balance Target must maintain to cater to budget-conscious shoppers, a sentiment that has driven the retailer to reduce prices on approximately 5,000 everyday items, including essentials like diapers and peanut butter.
The strategy appears to be working. Target reported a 3% increase in customer traffic across its stores and website, even as shoppers slightly reduced their spending per trip compared to the previous year. Cornell underscored that “value is in our DNA,” indicating Target’s commitment to offering competitive prices as a core aspect of its business model.
Cornell’s comments align with those of other retail leaders, such as Walmart CEO Doug McMillon, who also noted that prices in several merchandise categories have begun to decrease. However, McMillon acknowledged that inflation remains persistent in areas like dry groceries and processed foods, with some brands still pushing for cost increases—a trend that retailers like Walmart and Target are actively resisting.
As Target continues to navigate the challenges of a fluctuating economy, Cornell’s stance on price gouging underscores the company’s dedication to providing value to its customers while maintaining its competitive edge in the retail market.
