Target announces plan to revive Canadian operations

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Target Corp. announced Wednesday some significant changes to its operations in Canada, in an effort to turn around the retail giant's poor performance there over the past year.

The Minneapolis-based chain lost nearly $1 billion last year, as customers complained that the 120-some Canadian Target stores had a poor product selection, frequently ran out of merchandise and charged higher prices than other retailers.

The disappointing performance of the Canadian stores contributed to the dissatisfaction with former CEO Gregg Steinhafel, who was forced out in May. His replacement, Brian Cornell, started just this week.

Target unveiled a three-part strategy which will focus on solving those issues, according to a statement from Mark Schindele, president of Target Canada.

Schindele, who took over the troubled Canadian operation at the end of May, said Target Canada will match prices on local competitors' weekly ads, as well as the prices from online Canadian units of Amazon, Walmart, Best Buy, Sears and other retailers. It's also aiming to smooth out its inventory processes to make sure merchandise is shipped to stores more frequently.

Target says it will also expand its product lines, and as part of that effort it announced a partnership with Canadian designer Sarah Richardson, who will create a home decor line that will be in stores next year.

“We know we still have work to do, but the entire Target team is focused on continuous improvement so that Canadian guests will have the Target experience they deserve,” said Schindele.

A University of Toronto marketing professor, David Soberman, told MPR News that Target can still win over customers in Canada, noting that they're just looking for a good place to shop.

"People go into the store. They have expectations. If they don't like it, they don't shop there. They don't go around being angry with Target for the next three months," he said.

The company will release its latest quarterly earnings next Wednesday, and last week it cut its profit outlook, based in part on poor sales in Canada.

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