The popular US chain Target Corp. once had high expectations for its expansion into Canada. The prospective Canadian consumer base, many of whom had visited Target at one of its US locations, eagerly awaited for the discount retail store to open 127 locations across Canada– an ambitious plan if ever there was one, and Target is now admitting in a YouTube video that the highly-anticipated expansion was a massive failure, largely due to poor organization in the company and a lack of communication with customers.
Canadian consumers complained that the prices of products in Canadian Target stores were unrealistically high compared to prices in US Target stores, but many other customers were more concerned with the fact that store shelves were embarrassingly empty. Even when certain items were promoted in the store’s flyer, Target neglected to make sure that the product was fully stocked in stores. Customers complained that they drove to multiple locations in search of a particular item only to discover that none of the locations had it in stock, and it appears that Target could have avoided this problem by allowing customers to check product inventory on its website.
Target’s recent expansion trouble is evidence of a larger problem for which the company wasn’t prepared: although Target is based in the US, expanding into Canada demands a thorough understanding of what Canadian consumers want and expect from a big retail store. The employees in Target’s new Canadian stores are reportedly over 90% Canadian but there was a shocking lack of Canadians in executive positions, which the company now realizes may have been its biggest mistake.
Target is now trying to remedy that mistake by replacing some of its top American executives in charge of Canadian stores with Canadian executives who are more in-touch with what consumers demand and deserve. The retail giant is currently focusing on replacing Canadian president Tony Fisher, and not long ago Gregg Steinhafel stepped down from his position as CEO after it was reported that Target lost close to $900 million in its Canadian stores alone in the past fiscal year.
It is likely that Target will continue to focus on employing more Canadians as it tries to rectify its current situation, but critics may still be skeptical of such big internal changes. If the company could not manage to keep its shelves stocked, there is little reassurance that the US-based company will successfully stay aware of the needs of its 20,000 Canadian employees. Continuing to employ Canadians be a risky move for Target unless it increases awareness of differing regulations; for example, Canadian employees may be entitled to different vacation policies than American employees, and the standard two weeks vacation time varies between provinces. The replacement of Target’s top executives will hopefully ensure that Canadian employment policies are not ignored, or else we may be seeing another YouTube apology directed toward Target employees in the near future.