The invasion of Target Corp. (Minneapolis) into Canada has been called a “remarkable failure.”
The New York Times said analysts expect an $8-$9 billion loss to be reported this week.
Among the problems cited by experts are “the wisdom of opening 124 stores in a new market within months.”
“Inventory problems have often led to empty shelves and, perhaps worse, many of the stylish, exclusive brands Canadians see in Target’s American stores did not come north,” said the Times. “And, fairly or not, many Canadian shoppers contend that Target prices are much higher in Canada than back home.”
A Target spokesman said the current priority for Target Canada would be to improve operations. “The knowledge we gained in our first year will help as we focus on in-stocks and improving sales,” said Target’s Eric Hausman.
Another problem for Target was taking over the leases of 220 Zellers locations from Hudson’s Bay Co. Ltd. (Toronto). Zellers, the last major Canadian discount chain, which were smaller than a typical Target store in the U.S. and struggling on its own.