Canadian retail sales rose in Nov. 2014 to a record high of $43 billion Canadian dollars ($35 billion), however despite the numbers, retailer Target is giving up on its Canadian expansion and shutting its stores. CCTV America’s Kristiaan Yeo reported the story from Toronto.
Target’s move north was ambitious and well publicized. However, just two years after setting-up shop in Canada, the retailer is closing all 133 Canadian stores, leaving around 17,000 workers without jobs.
Target to close in Canada, 17,000 workers will lose jobsCanadian retail sales rose in Nov. 2014 to a record high of $43 billion Canadian dollars ($35 billion), however despite the numbers, retailer Target is giving up on its Canadian expansion and shutting its stores. CCTV America's Kristiaan Yeo reported the story from Toronto.
It was Target’s first expansion outside the U.S. and many Canadians already loved the brand, from their visits to the United States.
“I’d been on record as saying how badly Target had entered Canada and made almost every mistake a retailer could make,” Alan Middleton of York University said.
Target defended the closure, saying it would not have been profitable until at least 2021. The chain was hit with supply-chain problems and an under-performing product line-up. Meanwhile, Canadians fumed that prices were higher than they were in the U.S.
News of Target’s Canadian closure came just days after Sony said it was shuttering all of its stores there as well.
U.S. giants BestBuy and Sears have also faced a difficult few years, with layoffs and store closures. Some experts have said that retail heavyweights often wrongly assume that Canadians think and spend the same way Americans do.
“Americans are much more concerned with what they own, Canadians are much more concerned with the experience of owning,” Middleton said. “With new products, we are slower adopters than the U.S. The U.S. will try it if it’s something good and sexy and new, or it’s a really low price. The American tendency is to go try it, the Canadian tendency is ‘let me think about it for a bit.'”
Target learned the hard way that while Canadians love to shop, they choose carefully where they spend their money. Analysts have said retailers must earn consumer loyalty. Despite the news however, he U.S. department store chain Nordstrom has said it will enter the Canadian market.