Target doesn’t sell in Mexico, but without Mexico, it can’t stock its shelves. That’s why, in 2024, it opened operations in the country’s capital, and in 2025, it signed a lease for 1,211 square meters on the 11th floor of Neuchatel Cuadrante Polanco. A relocation or an expansion? That’s unclear. What is clear is this: from here, Mexico already fills the shelves of the United States.

Target is a big-box retailer that blends supermarket, department store, and discount shop into a single omnichannel experience. Its corporate landing in Mexico sparked speculation: Will it open stores? Warehouses? For now, no. That’s what the company has said. But its presence isn’t decorative—it’s structural. From Mexico City—and since 1998, from Guatemala—it designs, sources, and coordinates a network that supplies its stores north of the Río Grande.

Today, its shelves carry Mexico in many forms: from perishables and domestic inputs to processed goods made with Mexican ingredients under its Good & Gather brand, along with products from companies born in Mexico: 1790 Coffee, Mega Alimentos, Queso Fresco Cacique, Somos Foods, Tenayo, Tío Nacho, and Vainilla Molina.

Rooting in Mexico isn’t a trend—it’s a necessity: to reduce reliance on China and shield itself from trade wars, tariffs, and logistical disruptions. Target has been clear: if suppliers fail, if ships stop, if corn or freight prices soar, shelves go empty. And for a company selling essentials—diapers, milk, cereal, medicine—emptiness is not an option.

Even its CEO, Brian Cornell, has acknowledged it: the chain cut its dependence on China for private-label goods from 60% in 2017 to 30% today, with plans to push that figure even lower, down to 25%. In that transition, Mexico, Guatemala, and Honduras have become key sourcing hubs.

But the logic isn’t territorial—it’s financial. In 2024, Target’s real revenues and net income declined by 3.7% and 3.9% in real terms¹, respectively, due to lower foot traffic, higher costs, and a challenging macroeconomic environment. Physical growth was modest and not enough to reverse the trend. Still, the company didn’t shrink—it streamlined its operations, tightened its inventories, and improved its margins to stay solid.

In that process, Latin America is not a growth bet but a containment strategy. Target can’t raise prices without losing ground to giants like Walmart, and it already failed in Canada trying to operate outside its home turf. For now, Mexico is not a commercial foothold—it’s a logistical muscle. It didn’t come to sell, but to sustain. From here, it builds shorter, cheaper, more stable supply chains. And in that equation, cutting costs means more margin, more cash flow, more capacity to invest.

Will Target ever compete in Mexico? No one knows. In the medium term, it’s not on the horizon. But if you look out the window of its 11th-floor office in Neuchatel, what you see is not a market—it’s a mirror. Because from there, Mexico reflects with clarity the tension the U.S. has yet to resolve: how to sustain its abundance without bearing its cost.

In a world of invisible chains, understanding the landscape is power. SiiLA is the most reliable resource to track the evolution of real estate in Mexico and Latin America. Please write to us at: contacto@siila.com.mx

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¹ Calculations based on Target’s reported revenues and net income for 2023 ($105.8 billion and $4.138 billion) and 2024 ($104.8 billion and $4.091 billion), adjusted for inflation using the seasonally adjusted CPI-U from the St. Louis Fed: 308.735 in December 2023 and 317.603 in December 2024 (cumulative inflation: 2.88%). Since 2023 had one additional week of operations, both years were compared in real and equivalent terms.