The encyclopedia · Sales & Retail · Strategic decision · 2015
Target opened 133 Canadian stores in two years — and lost C$2.1B retreating
Target rushed into Canada with 133 stores, a broken supply chain and empty shelves. Canadian shoppers gave up. Target exited in 2015 with C$2.1B in losses.
Target Corporation · 2015-01
What happened
In 2013, Target, the US discount retailer, expanded into Canada by acquiring 220 Zellers store leases and opening 133 Target stores in under two years. The expansion was the largest international retail launch in Canadian history, and Target expected to replicate its US success.
But the execution was disastrous. Target's supply chain was not ready: stores opened with empty shelves, pricing was higher than in the US, and the product selection was disappointing. Canadian shoppers who had crossed the border to shop at US Target stores found the Canadian version unrecognizable. The data migration from Zellers was botched, and inventory systems failed.
Target lost C$2.1 billion on the Canadian expansion and announced its complete withdrawal in January 2015, closing all 133 stores and eliminating 17,600 jobs. The case illustrated the danger of rushing an international expansion without the infrastructure, supply chain and local market knowledge to support it.
Why it happened
- Target opened 133 stores in under two years without a functioning supply chain or inventory system.
- Stores opened with empty shelves, higher prices and a disappointing product selection.
- The data migration from Zellers was botched, and inventory systems failed.
- Canadian shoppers who knew the US brand found the Canadian version unrecognizable and gave up.
The lesson
Speed is not a strategy. Target opened 133 stores before it could stock them. Empty shelves are not a launch — they are a confession.
Aftermath
Target exited Canada entirely in 2015. The company refocused on its US operations and invested in digital and store experience. The Canadian expansion is now the most-cited example of a failed international retail entry.
Sources
- Target Canada — Wikipedia (expansion, failure, exit)
- CNBC, 15 January 2015 — Target leaving Canada (133 stores; about 17,600 employees; $2.1 billion lost on the venture through Q3 2014)
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