Target Canada To Close All 133 Stores After Sinking Losing Billions

Target Canada To Close All Stores

Target Canada To Close All Stores

Target Shuttering 133 Canadian Stores

Target, the second largest retail chain in the U.S., has announced plans to shutter its 133 Target stores throughout Canada, after an extensive performance review discovered that its Canadian operations could not sustain long-term profitability. Admitted Brian Cornell, CEO of the Minneapolis-based firm that employs 17,600 people in its Canadian operations, the decision to shut down its Canadian stores was a very difficult one.

Target’s decision regarding its Canadian operation did not come as a complete surprise to business analysts, since Target has been struggling to maintain profitability in this region of the world for the past few years. Largely due to the performance of its Canadian retail stores, the retailer is expected to post four quarter losses of more than $5 billion. Although its Canadian operations proved to be a general drain on its financial resources, Target maintains that its U.S. operations continue to be strong and thriving. The shuttering of its Canadian operations will help to boost the company’s current fiscal year earnings and at the same time strengthen the company’s overall cash flow position.

“After a thorough review of our Canadian performance and careful consideration of the implications of all options, we were unable to find a realistic scenario that would get Target Canada to profitability until at least 2021,” CEO Brian Cornell said in a release Thursday, explaining the justification for the shutdown.
Officials at Target had previously admitted that they were counting on a strong 2014 holiday season in Canada to help turn the financial picture around, and were disappointed when that did not happen. Target says it is currently seeking bankruptcy court approval to place approximately $59 million US, or 70 million Canadian dollars, into a general fund which would provide four months of unemployment compensation and benefits for the more than 17,000 Target employees in Canada. Officials say they possess the roughly $500 to $600 million in cash necessary to formalize the end of its business operations in Canada. No exact date has been announced for the closing of the Canadian Target stores, with liquidation sales expected to get underway.

http://money.cnn.com/2015/01/15/news/companies/target-ends-canadian-operations/index.html


Sean is a London (Ontario) based writer, and has been writing full-time for eCanadaNow since May of 2005, covering Canadian topics and world issues. Since 2009, Sean has been the lead editor for eCanadaNow. Prior to his work writing and editing for the eCanadaNow, he worked as a freelancer for several Canadian newspapers.. You can contact Sean at {Sean at ecanadanow.com] Google

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