When the management of a large grocery store heard that Target might be coming to town, they developed alternative courses of action they could take if their competitive landscape changed. What type of plan did they develop?

A contingency plan

Explanation:

A contingency plan is an alternative plan taken to prevent an event which could have severe consequences. It is usually taken, not as a plan A, but as a preventive measure for a bad event, which although not likely to happen, but could have spelling consequences at its occurrence.

Although, it is not certain Target will come to the town, the grocery store devised an alternative plan in case the event happens which could affect their business, hence, a contingency plan.