Target Canada Case Study

How Supply Chain Management Problems Killed Target Canada

Introduction

Target is such a huge success in the United States, why wouldn’t it be in Canada? Time seems to be a main factor to the failure of Target Canada. Systems take time to be implemented into a new environment. Without the time and effort to learn and work these new systems, a business can fail. Supply chain management is a very important factor into helping a business thrive. It manages the flow of goods and services, from raw materials, to work-in-process inventory, to finished goods. Without a well implemented system in place, a business is unlikely to become successful. Target Canada failed to thrive, because of the lack of time directed towards these new management

Unfortunately, those systems were not geared towards foreign countries. Target went with a new system that took an average of 3 to 5 years to implement, but Target rushed into everything. This is what caused Target to have a lot of set backs with their supply chain management systems. It seemed as though every part of their system was failing them in some way. They were not willing to put the time into the expansion, rushing through everything. The company spent about $7 billion on expanding into Canada and wasn’t expecting to see a profit until 2021 at the earliest. Target then decided to close all 133 stores and 17,600 people became unemployed.

Without a well-built supply chain management system, it’s almost impossible for any company to succeed. Target’s U.S. operations had custom-built systems for their supply chain management which allowed them to be a successful corporation in the U.S. Unfortunately, this well-built system was not easily adaptable for foreign countries. Target’s

“Launching the Target brand in a new country was his biggest task to date” (Castaldo). Meetings were held every day until the launch date for Target Canada. In the meetings, they would discuss the development of their new supply chain systems. There seemed to be new problems every day. “The company was having trouble moving products from its cavernous distribution centers and onto store shelves, which would leave Target outlets poorly stocked. The checkout system was glitchy and didn’t process transactions properly. Worse, the technology governing inventory and sales was new to the organization; no one seemed to fully understand how it all worked” (Castaldo). Fisher had a decision to make, open anyways or delay opening to work out the problems. They decided to go ahead with the opening, to avoid even more setbacks. “’That was the biggest mistake we could have made’” (Castaldo). Target was “trying to accomplish too much, too fast, with too little thought” (Weissmann). Without taking the time and efforts to fix all the glitches in their supply chain management systems before opening their new stores in Canada, it caused even more problems. “It faced huge supply chain problems due to a myriad of problems at its warehouses, poor communication with headquarters and the use of inexperienced staff. That left stores poorly stocked and selection limited, disappointing shoppers who had eagerly