Target chairman and CEO Brian Cornell is communicating openly with shareholders and employees after the company announced its plan to pull all of its stores out of Canada.
The retailer dropped the bombshell on Thursday via two press releases, a Q&A on its website about fair treatment to Target Canada employees, and another Q&A featuring Cornell in the company’s online magazine A Bullseye View. Cornell and Target CFO John Mulligan also hosted a call for investors to discuss the announcement and carried out a number of interviews with media outlets, such as Mashable.
Target’s various Twitter handles, including @TargetNews, @TargetCanada, and @Target, posted tweets linking to the company’s statements on the matter.
"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," explained Cornell in a release.
In the Bullseye View interview, he added that Target Canada, which launched in Spring 2013, was "losing money every day."
Cornell made it clear that exiting the Canadian market and focusing on driving growth and building further momentum in the US was in the best interest of Target’s shareholders.
He also outlined in A Bullseye View how the company came to make the "difficult" decision of shutting down Canadian operations and all the risks he realized were involved in doing so, such as disappointing guests, presenting unique challenges for partners, and affecting the lives of employees.
Cornell noted the mistakes that brought Target to this point, such as "missing the mark from the beginning by taking on too much too fast," struggling with inventory issues, and not being "as sharp" on pricing as the company should have been. He added that he has been honest and open about these issues from the beginning.
Katie Boylan, Target’s director of PR, declined to comment on the communications strategy behind the announcement.
Target Canada currently has 133 stores across the country and employs approximately 17,600 people. To ensure "fair treatment" of affected staffers, Target is voluntarily seeking court approval to make cash contributions of $59 million into an Employee Trust to all Target Canada-based employees with a minimum of 16 weeks of compensation.
The stores will remain open during the liquidation process, which begins in several weeks, and all stores will be closed in 16 to 20 weeks.
Target expects $5.4 billion in Q4 losses from discontinued operations in Canada and foresees about $275 million of losses on discontinued operations in fiscal 2015, the retailer said in a statement.