Last week Target Canada announced that after 2 years of losses, it was going to take it’s little dog and go home, leaving the land of maple syrup and poutine to pick up the pieces of a shattered dream for over 17,000 Canadians.
Sure, Canada can be an inhospitable place when it comes to the frozen retail jungle, with our high taxes, importing tariffs, base labour rates, etcetera, etcetera. That much we know, so why didn’t the big brains at Target know that? Maybe they could have nudged a friendly Canuck on the arm and found out what we’re all about, or sifted through the ashes of other failed chains like Radio Shack, Sam’s Club and Marks & Spencer for clues.
Perhaps the giveaway of their eventual demise was their clamor to buy up retail space from the failed Zeller’s chain…an omen of things to come?
We can all sympathize with the dire news that hits us every January in this country, when the bean-counters tally up the coveted Christmas retail sales numbers only to find another chain is waving the white flag and liquidating it’s inventory as sales fell short of what was needed to keep the ship afloat.
For that, I feel sad. For Target, my feelings are not so benevolent. It has nothing to do with it being a U.S. chain that invaded our snow-covered borders. Heck, we were excited to have them here! We welcomed the enormous bulls-eye with open arms and open wallets. No, my wrath has nothing to do with where Target came from. It’s in how they came and how they left.
Target arrived with more fanfare than a Presidential Inauguration. “We are the great Target, and we will give good jobs to hard-working Canadians. We will support distributors, vendors, support services, and landlords; bring tax revenue to this quaint little country, and we will take on the much-despised Walmart”.
They traded here on their U.S. strength, deep coffers, savvy buying and great prices all wrapped in a sophisticated retail environment. They said, in so many words, that they were a huge American company, so trust them.
Vendors signed up to deliver goods without credit check, terms or deposits. They were happy just to be one of the few chosen to stock the shelves in this great retailing giant. Workers were romanced into leaving good paying jobs to join this amazing company. They all had dreams of long-term growth, as demonstrated south of the border. And Target traded on their impressive U.S. CV.
But something went very wrong. Their first store openings were as unimpressive as a beach party during a Canadian snow storm. Empty shelves, weak pricing, boring selection all had the Canadian shoppers shaking their collective heads as to what Target was thinking.
It never got any better. Stores continued to suffer from delivery issues, non-competitive pricing, and ineffective advertising. The only thing emptier than the shelves were the check-out lines. The writing was on the wall right from the first ribbon-cutting in Guelph Ontario.
Bad planning? Perhaps. Underestimating the Canadian retail landscape? For sure. These things are tragic and stupid, but that’s not what has me writing this. The ire is in what Target did next.
After using the American head office muscle to sway us into a false sense of security with Target, they decided to pack up and leave not as an American retail powerhouse, but as a failed Canadian company that has applied for creditor protection (Canadian version of Chapter 7 – bankruptcy protection).
That’s right – Target, with all its money and influence, chose to slink back south of the border without having to make good on it’s promises to us Canadians. Besides the 17,000 plus employees that are left in the dust, Target has used a legal loophole to avoid having to pay it’s bills here. Not as that big American company that used all its leverage to gain favour, but as a uniquely Canadian company unable to cover it’s debt.
So now they’ll leave with hat in hand, saying ‘Gee, shucks. Really sorry about all that inventory you shipped us, but we can’t pay for it’. Nowhere is the American parent, still with deep pockets and international influence, swooping in to take care of the mess their offspring created, even though it was that parent who persuaded us to ‘trust’ their kid.
Where is that strong giant parent company, now that all those workers are applying for employment insurance? What about the suppliers who are hoping to get something from the inventory liquidation process to cover some of their losses – and probably having to lay off more people – the contractors who clean, maintain, and provide security to the Target stores? All out of work, and possibly out of pocket.
There are more, I’m sure that will be affected by this, and many won’t get paid for outstanding invoices. Target will carry on south of the border as if nothing happened up here, and some of us will still travel across to cash in on bargains, just like they have in the past.
Instead of stepping back into the mess they’ve created and making good on their financial commitments, Target chose to protect itself from taking responsibility for a lousy business strategy, and for causing a huge ripple effect on the Canadian economy.
Shameful…and I hate them for it.