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Target In Canada Case Study

1225 Words5 Pages

Introduction
Target had two main reasons why it ventured into the Canadian market. The first reason entails the success of its competitor, Wal-Mart, which had successfully operated in Canada for a number of years (Supply Chain 247, 2015). The second reason was that Canadians used to go to the US, and they used to shop in Target. This set of customers convinced Target that its operations can be successful in Canada. However, Target had to close its 133 stores in Canada. The company had realized that it would take long, 6 years, for the company to start making profits. The exit of the company from the Canadian market presented a series of lessons that the company as well as other supply chains can learn.
Target Problems The first lesson that the Target retail supply chain disaster in Canada offers entails the need for a gradual national expansion rather than massive lump sum capital injections. In 2014, Target opened over 100 stores simultaneously (Supply Chain 247, 2015). It shows that the company did not take its time to study the Canadian market and make the necessary adjustments that aligned its operations with the market conditions. The move to open several stores at once also meant that the company …show more content…

Canadians had gotten used to low prices in the US market, but the company raised the prices when it ventured in the Canadian market (Supply Chain 247, 2015). This move was a setback to the performance of the company, and it left its potential customers disappointed. Canadians had expected Target to rival the local supply chains that sold goods at high prices. However, the company decided to follow the prevailing market conditions of Canada. The issue of setting prices too high eroded the goodwill that Canadians had set on Target. Actually, the goodwill had already gone even before the company’s arrival in the market when the word went round about the company’s price

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