Target In Canada Case Study

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Thank you for exploring the opportunity of expanding Bloomingdale north of the border. Overall, Canada's economy is strong, a notable shift in the economy will see infrastructure activity and rising business spending play a more dominant role next year according to Wrightin 2017. Government spending on infrastructure and a moderate increase in business investment, are forecast to support economic growth next year RBC noted in its end-of-year forecast. Canada had some bad luck with the retail sector. Sears Canada is about to close all of its stores, releasing millions of square feet of space to fill. Off-price retailing is about to see unprecedented competition as Nordstrom Rack enters the market this spring. Doing business in Canada can be …show more content…

Target found itself having to compete on pricing with Wal-Mart, which has been in Canada since 1994 and got aggressive to protect its hard-fought Canadian market share. The company struggled from the outset to find a proper mix of inventory, often having too much of some products and not enough of others. Secondly, shoppers complained of empty shelves and a lack of selection. The company had been working to improve its inventory management, but it was too little too late. Thirdly, many Canadians were already very familiar with Target, having shopped in its stores across the border. While that brand awareness gave Target an initial boost, Canadians soon started complaining that Target’s Canadian stores had higher prices and lacked the same products as U.S. stores. Lastly Target's launch in Canada was overambitious. The retailer opened 124 stores in 10 months in its first year. The main lesson to be learned is that Canadians and Americans are not the same. Americans are more one stop shoppers compared to Canadians, Canadians are more frugal and aren't scared to shop around until they find the best price for the quality of the product. Over the past several decades, some US retailers have gone on to thrive in Canada's retail landscape, such as retail giant's Home Depot Inc., Staples, Costco, Wal-Mart and Starbucks. But it was not all smooth riding. Not all brands or business models will make it in Canada, even if owned by the same retail chain, no matter how sophisticated. Wal-Mart, which first arrived on the Canadian scene by taking over Woolco in 1994, continues expanding its general and supercentre stores, but closed down its Sam's Club stores a few years ago, unable to compete with Costco, which had set up shop in Canada

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