Customer engagement, apparently, was not happening at Target’s stores in Canada.
Less than two years after Target opened its first stores in Canada, it announced it will close all of its Canadian stores. The Thursday announcement means more than 17,000 Target employees will be out of work.
During the company’s third-quarter financial results conference call in November, Target CEO Brian Cornell hinted at the problems with Target Canada.
“In Canada we are expecting much better fourth-quarter performance than we experienced last year,” Cornell said in November. “But we know that to succeed in Canada, we will need a major step change in performance. The fact is, given where we are performing today, we need to see improved financial performance from every Target store in Canada over time. The team has worked hard to prepare for the Canadian operations for the fourth quarter. And we will be watching to see how those improvements connect with our guests during the holiday season.”
Target operates 1,916 stores in the United States. It began operations in Canada in March 2013 and currently has 133 stores in Canada.
“When I joined Target, I promised our team and shareholders that I would take a hard look at our business and operations in an effort to improve our performance and transform our company,”
Cornell said in a statement. “After a thorough review of our Canadian performance and careful consideration of the implications of all options, we were unable to find a realistic scenario that would get Target Canada to profitability until at least 2021. Personally, this was a very difficult decision, but it was the right decision for our company. With the full support of Target Corporation’s Board of Directors, we have determined that it is inthe best interest of our business and our shareholders to exit the Canadian market and focus on driving growth and building further momentum in our U.S. business.”