Target Canada to close all 133 stores two years after launch

Target will close all of its 133 stores in Canada two years after launching there.

On current trading performance, Target Canada, which employs 17,600 people, would not be profitable before 2021, its US parent said in a statement.

Target Canada, which has filed for bankruptcy protection, faced tough competition from Walmart and Costco, which opened in the country years ago.

The US discount store said the closure was in the “best interest of the business”.

Target chairman and chief executive Brian Cornell said in a statement: “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.”

Brian Cornell said the focus now would be on “driving growth” in the US, where it has 1,801 stores.

There had been criticism that Target’s launch in Canada was inept, with uncompetitive pricing and poor range of stock in the stores.

Shares in Target rose 8% in early trading following the news it was leaving Canada.

Brian Cornell, named chief executive six months ago, said: “It was a difficult decision but it was the right decision for our company.

“We have determined that it is in the best interest of our business and our shareholders to exit the Canadian market and focus on driving growth and building further momentum in our US business.”

It is Brian Cornell’s first big move following the resignation of Gregg Steinhafel last year.

Target is not the only US discounter to suffer across the border. Big Lots and Best Buy have both closed stores in Canada.

Target said it expected cost of the exit to be between $500 million and $600 million.