Target to close all 133 stores in Canada

[Newsjock]

http://www.ctvnews.ca/business/target-pulling-out-of-canada-after-failed-expansion-1.2189973

Target has stunned the retail community by announcing it's planning to close all its 133 stores in Canada and file for creditor protection.

The announcement Thursday deals a huge blow to Target Canada's 17,600 employees.

Target Canada says that to ensure fair treatment of its employees, nearly all will receive a minimum of 16 weeks of compensation, including wages and benefits coverage for those employees not required for the wind-down period.

... Target Corporation CEO Brian Cornell said that after thoroughly reviewing the company's Canadian performance, Target Canada had little hope of reaching full profitability until at least 2021.

[SidDithers]

1. Wow. That's gonna leave a big hole in a lot of shopping centers and malls...nt

Sid

[Renew Deal]

2. What is the difference between profitability and "full profitability?"

It probably makes Targets operations much simpler to just not be in Canada at all.

[BlueJazz]

3. "nearly all will receive a minimum of 16 weeks of compensation, including wages and benefits"

I wonder if companies like Walmart would do the same in a similar situation ?

[Sanity Claws]

4. No and I doubt Target would do it in the US

My guess is that the compensation is required by Canada law.

[BlueJazz]

6. You may very well be correct. I forgot about that.

[SidDithers]

8. It is...

At least in Ontario, a mass layoff of more than 500 people requires 16 weeks of notice or severance in lieu of notice.

Sid

[Agschmid]

5. Wow.

Canada is usually pretty profitable for
American retail companies.

[SidDithers]

7. Target was a mess right from the start...

they launched before the were ready, with stores that were only partially stocked, and with much higher pricing than in their US stores.

Those first impressions permeated through the Canadian marketplace, and Target was never able to recover.

Sid

[47of74]

9. Reminds me of Wal-Mart's Germany experiment

Wal-Mart tried to import themselves into Germany back in 1997 but had to abandon the market back in 2006. From what I gathered there were several factors at play, but mostly boiled down to they just tried to drop the stores in place without accounting for cultural differences or differences in the market environment between the US and Germany.

http://www.huffingtonpost.com/david-macaray/why-did-walmart-leave-ger_b_940542.html
http://www.atlantic-times.com/archive_detail.php?recordID=615

I kind of wonder if something similar happened here, where Target was in such a rush to get a footprint established north of the border that they nailed themselves in the foot, then the other foot, then the knees, and finally in both hands getting that footprint established.

[Sen. Walter Sobchak]

12. I think it was pressure to lockdown the Zellers locations in a mega-deal

They probably didn't want to get into bidding wars with Walmart, Loblaws and Quebec based chains down the road on a one-off basis.

I suspected at the time Target would come into Canada with urban format stores and SuperTargets in the Vancouver, Calgary, Toronto and Montreal markets and built out from there.

[hunter]

10. Wal-Mart, and to a slightly lesser extent, Target, are subsidized in the U.S.A...

... everything from desperate workers to food stamps.

[Sen. Walter Sobchak]

11. I don't think I could possibly roll my eyes back any further

I was really excited when Target opened, but growing pains that might have been expected in a stores first couple of weeks persisted to this day. My personal favorite was their propensity to advertise things in the flyer that weren't merely out of stock, but the local stores didn't even carry in the first place. I also don't think they employed anyone in merchandising. Why is out of season clearance shit lined up right through the main thoroughfare of the store? Why are end-caps completely empty? Call Coca-Cola, they will put a display there today. Call Gillette, they will put a display there next week. This is Calgary, why is there Oilers and Ottawa Senators merchandise front and center?

I used to be a supply chain audit manager for a US retailer, I'm lucky to have left a Canadian Target location without PTSD.

[kelliekat44]

13. Wonder what the CEO's and high management bonuses were last year??? nt