Target Canada files for creditor protection, plans to close

Target Canada files for creditor protection, plans to close

Postby radiofan » Thu Jan 15, 2015 8:25 am

Target Canada files for creditor protection, plans to close all stores
Retail chain opened up in spring of 2013 but has decided to close up shop
By Pete Evans, CBC News Posted: Jan 15, 2015 8:37 AM ET Last Updated: Jan 15, 2015 10:11 AM ET

Target says it plans to discontinue all operations in Canada and seek protection from creditors, less than two years after opening to much fanfare.

In a release early Thursday, the U.S. retail chain said it will close all its locations in Canada. There are 133 stores across the country with about 17,600 employees.

The company launched in Canada in the spring of 2013.

But after high expectations, the chain failed to deliver right out of the gate as customers faced higher-than-expected prices, and empty shelves as the retailer had problems with its distribution chain.

    How Target missed the mark in Canada
    Target's failed launch offers lessons for other Canadian retailers

Target lost almost $1 billion in its first year in Canada, and while the losses have shrank since then, the chain is still losing money daily.

Executives repeatedly promised they would get it right and reaffirmed their commitment to Canada as recently as July, but ultimately decided to pull the plug.

"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.

Target says it filed an application in a Toronto courtroom for protection under the Companies’ Creditors Arrangement Act.

The federal law allows companies that can't pay their debts the ability to restructure themselves. Without it, the companies and individuals that an insolvent company owes money to can technically start seizing assets. But because Target has applied under CCAA, that won't happen here yet.

Target's shareholders welcomed the news, sending shares in the company up almost three per cent on the NYSE on Thursday. Closing up shop in Canada means the company has more money to focus its efforts on shoring up its also-struggling U.S. operations.

Reda more here: http://www.cbc.ca/news/business/target- ... -1.2901618
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Re: Target Canada files for creditor protection, plans to cl

Postby bigbry » Thu Jan 15, 2015 8:39 am

The War of 1812 lasted longer than Target did in Canada.
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Re: Target Canada files for creditor protection, plans to cl

Postby Jim Walters » Thu Jan 15, 2015 9:13 am

I don't think they will be missed in the least.

The only time I visited a Traget Canada store was to cut through it to get elsewhere in the mall.

As I recall, most of their launches were pretty dismal. They didn't attract the hordes of customers they were expecting. Some locations had more media tha customers on day one.

Other than the jobs and the broken leases, no great loss.
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Re: Target Canada files for creditor protection, plans to cl

Postby jon » Thu Jan 15, 2015 3:21 pm

I was surprised recently to find that Sony still had stores in Canada, given how much money the company has been losing in the last few years.

Though hardly much of a presence, when compared to Target, they are closing the few remaining stores.

Sony to close all its stores in Canada
By Vito Pilieci
Ottawa Citizen
January 15, 2015 1:55 PM

Sony Corp. will close all 14 of its Sony Stores across Canada as the company continues to struggle to reshape its business.

The company made the announcement on Thursday in a memo to the employees of its stores — including its Ottawa location in the Bayshore Shopping Centre — telling them that the stores will cease operations within the next two months.

The company confirmed the news in a statement released to The Citizen.

“Over the next 6 to 8 weeks we are closing our Sony Stores in Canada and will redirect all of this business through our national network of Sony retailers, our online store … as well as through our Sony-trained Telesales team,” read the statement. “Our network of Sony authorized retailers offer a full range of Sony products and will be supported by our in-store Merchandisers and Product Trainers on an ongoing basis in order to ensure that our past customers have continued access to knowledgeable Sales consultants who can support their ongoing Sony electronics needs.“

The company’s news came on the same day that Target announced it would be shuttering all of its retail stores in Canada.

Sony did not say how many jobs are affected by the decision.

The closure comes as Sony is struggling to reshape its business amidst years of losses. For the current fiscal year which ends in March, the company is estimating a $1.9 billion (U.S.) loss.

Within the last year the company sold its Vaio personal computing business and spun out its TV manufacturing operations.

It is now reported to be considering exiting the TV business entirely. The company is also considering options for its lacklustre cellular phone division.
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Re: Target Canada files for creditor protection, plans to cl

Postby Tom Jeffries » Thu Jan 15, 2015 7:38 pm

Target is also throwing in the towel, in Canada....and if some of the economic indicators hold to form - this is the start of a cascading effect.

The retail sector is having a tough time - and it is being reflected in advertising revenue for media.

I wonder how CORUS is doing>?
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Re: Target Canada files for creditor protection, plans to cl

Postby radiofan » Fri Jan 16, 2015 9:49 am

Let's add Radio Shack (US) to the list ...
Radio Shack plunges on report of bankruptcy

Mike Snider, USA TODAY 7:33 p.m. EST January 15, 2015

RadioShack (RSH) shares on Thursday plummeted a whopping 35.6% -- to a scant three nickels per share -- on a report that the company could file for bankruptcy protection reportedly as soon as next month.

The embattled consumer electronics retailer is in talks with a private-equity firm that could buy its assets out of bankruptcy, according to The Wall Street Journal, which cited sources familiar with the people familiar with the matter.

Last month, the Fort Worth, Tex.-based chain reiterated that bankruptcy proceedings could result if its own revitalition plan proved unsuccessful.

Read more at: http://www.usatoday.com/story/tech/2015 ... /21799233/
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Re: Target Canada files for creditor protection, plans to cl

Postby tuned » Fri Jan 16, 2015 11:34 am

Many Canadians have easy access to US Target stores which didn't help in establishing a Canadian business. Why shop at a poor imitation when you can go to the original? Sony can't make retail work yet Apple stores are packed. Why? Sony doesn't have any hits and Apple owns the Top 40. There are a long list of businesses from the US that have failed in Canada and many more from Canada that have failed in the US. It's because on the surface Canada and the US seem very similar but the country and its people are really quite different.
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Re: Target Canada files for creditor protection, plans to cl

Postby jon » Fri Jan 16, 2015 12:19 pm

tuned wrote:It's because on the surface Canada and the US seem very similar but the country and its people are really quite different.

Equally important is how different the Wholesale and Manufacturing Channels are in the two countries. As Walmart found out when they first moved into Canada. Many, perhaps most, prices went up, not down, in our local Woolco stores when they became Walmart.

It took about two years for Walmart to learn the Canadian "channels" and/or create their own, and start delivering the killer deals they were famous for in the U.S.

Like Target, Walmart came into Canada thinking it would be easy just to clone what they did in the U.S. But they started smaller than Target did, and the Canadian retail market was very different back then.

As for Sony, one look inside the few remaining stores doesn't remind anyone of an Apple Store. The Sony Store feels just like the Miller Sound Centre stores that Sony bought about 30 years ago: full of big TVs and amplifiers.
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