Since Target opened its first Canadian stores in 2013, the retailer has struggled to replicate its U.S. success, largely due to an unsatisfactory distribution network that resulted in higher-than-expected prices and poor in-store stock supplies. Now, Target is giving up its efforts in the north: On Thursday, Target announced it will close all 133 of its Canadian stores and lay off 17,600 employees in Canada.
Target’s Canada unit has filed for bankruptcy protection, The New York Times reports.
“I’ve never seen a set of expectations that are so shockingly missed on a rollout,” Rob Wilson, a retail analyst at the Tiburon Research Group in San Francisco told The New York Times last year, just before Target’s Canadian operations announced losses of more than $800 million.
In a statement, Target’s chairman and chief executive Brian Cornell said that the decision to close the Canadian offshoot came after it was determined that it would take until at least 2021 for the business to be profitable.
The company is planning to establish a $59 million trust fund, which will give Canadian employees a minimum of 16 weeks of severance pay.
[via The New York Times]