Target's Failure In Canada Case Study
Target’s Failure in Canada
Target Canada was the Canadian subsidiary of Target Corporation which is a major retailer in the United States. In 2011, Target bought out several Zellers locations and announced it was going to expand into Canada which caused a sense of expectation and excitement for the Canadian consumers. In 2013, Target Canada opened its first store and by 2015, it had 133 locations operating across the country (Vachet, 2015). But, Target Canada was so unsuccessful in Canada that in 2015 it was filed for bankruptcy and had to close all its stores (Vachet, 2015). There are various reasons why Target did not flourish in the Canadian Market.
a) High Prices
The stores had higher prices as compared to the U.S. Canadians found that they were paying much more as …show more content…
The store’s shelves were disorganized and empty with limited selection. Inventory did not arrive into the stores quickly and shelves was not filled to meet demands of customers. There was no proper mix of inventory and there were many complaints from customers.
d) Competition
Before entering the Canadian market, Target already had many competitors such as such as Walmart, Loblaw, Canadian Tire, etc. These retailers did a defensive job prior to the entrance of Target into Canada by offering better pricing and improving their store locations. Target’s main competitor was Walmart. Target found it difficult to compete with Walmart since it had been in Canada from 1994 and was very hard for Target to match the prices offered by Walmart.
e) Target underestimated the Canadian market. They thought that by expanding a successful U.S. retailer in Canada, Target would also be successful in Canada. In fact, they failed to differentiate between the U.S. and Canadian markets. Customers were disappointed as they expected Target Canada to be the same as in the U.S. in terms of prices, products,
Target Canada was the Canadian subsidiary of Target Corporation which is a major retailer in the United States. In 2011, Target bought out several Zellers locations and announced it was going to expand into Canada which caused a sense of expectation and excitement for the Canadian consumers. In 2013, Target Canada opened its first store and by 2015, it had 133 locations operating across the country (Vachet, 2015). But, Target Canada was so unsuccessful in Canada that in 2015 it was filed for bankruptcy and had to close all its stores (Vachet, 2015). There are various reasons why Target did not flourish in the Canadian Market.
a) High Prices
The stores had higher prices as compared to the U.S. Canadians found that they were paying much more as …show more content…
The store’s shelves were disorganized and empty with limited selection. Inventory did not arrive into the stores quickly and shelves was not filled to meet demands of customers. There was no proper mix of inventory and there were many complaints from customers.
d) Competition
Before entering the Canadian market, Target already had many competitors such as such as Walmart, Loblaw, Canadian Tire, etc. These retailers did a defensive job prior to the entrance of Target into Canada by offering better pricing and improving their store locations. Target’s main competitor was Walmart. Target found it difficult to compete with Walmart since it had been in Canada from 1994 and was very hard for Target to match the prices offered by Walmart.
e) Target underestimated the Canadian market. They thought that by expanding a successful U.S. retailer in Canada, Target would also be successful in Canada. In fact, they failed to differentiate between the U.S. and Canadian markets. Customers were disappointed as they expected Target Canada to be the same as in the U.S. in terms of prices, products,