Target could be copying the Temu model

As retail sales slump, Target is exploring replicating the Temu and Shein model for its customers.

A new report from Bloomberg that cites people familiar with the matter says the retail giant is experimenting with shipping products directly from factories to customers’ homes.

Target, which did not immediately return a request for comment, will offer cheaper products through the Temu lookalike program. The test run will sell items like clothes and household goods, the report said.

“In all cases, we uphold the high quality, responsible sourcing and sustainability standards that Target is known for and that consumers expect from us,” a Target spokesperson told Bloomberg.

The news comes as the big-box retailer has fallen on hard times. Its shares have shed more than a quarter of their value this year alone, and a sustained consumer boycott following its decision to end diversity, equity, and inclusion practices appears to be affecting its bottom line.

Last month, the company reported adjusted earnings per share of $1.30, falling 21% short of analyst expectations, and down from $2.03 a year ago on the same basis. Comparable sales fell 3.8%, with in-store traffic down 5.7%, offset only partially by a 4.7% rise in digital sales.

Target’s experiment also comes at a challenging time for retailers that ship directly from factories overseas. President Donald Trump recently eliminated the de minimis exemption that allowed orders of less than $800 to be shipped to the U.S. without taxes. And many of the products likely to be sold as part of Target's experiment will be made in China and subject to tariffs. 

—Catherine Baab contributed to this article.