After only 26 months in Canada, Target (tgt) can't get out of its only international market fast enough.
The discount retailer said late Wednesday that it is closing the last of its 133 stores in the Great White North on April 12, a month earlier than initial estimates, in an ignominious end to what turned out to be a $7 billion misadventure that distracted Target while its U.S. business fell behind that of its rivals.
After visiting poorly-attended Target stores in Canada shortly before Christmas, new CEO Brian Cornell decided to pull the plug on the company's business there, preferring to write down billions in losses so he could concentrate on revitalizing the retailer's brand at home than wait until 2021 for the unit to maybe turn a profit under a best-case scenario.
As detailed in a recent Fortune profile of Cornell and his turnaround plan for Target, the retailer's move into Canada was a fiasco. Rather than launching new stores in carefully- selected spots and building slowly, Target acquired 124 locations in 2013 in one fell swoop by buying all the outlets from a failed discounter called Zellers, whose stores were in dismal locations. In addition, Target suffered from supply-chain problems that yielded empty shelves and high prices, and it added up to an unmitigated disaster.
Soon after Target Canada filed for creditors’ court protection on Jan. 15, Canada's equivalent to a Chapter 11 bankruptcy protection filing, the company was stung by a torrent of bad publicity about what shoppers saw as disappointing liquidation sales, and disputes with vendors try to get back money for orders placed by Target in the 30 days before it filed for court protection.
But Target is not leaving without trying to take some goodies with it: the Globe & Mail in Toronto last week reported that Target would ask the court let it buy items from its Canadian division, including a bronze bull’s eye (its logo) sculpture at the company’s Toronto-area as part of a $2.2 million deal.