Target Closing Down all 133 stores

[lrt's friend]

Yes, back in the 1960s, it was routine for my mother to drive right downtown to do most of her shopping. Not groceries but remember that in those days milk and bread were delivered to your door. There were also convenient car parks next to Murphy Gambles on Queen Street, Ogilvy's on Besserer Street and Frieman's on George Street. Things have changed a lot in perception as well. Back then, it was routine to have larger items delivered. Now, everybody dumps their purchases in the SUV. The immediate gratification thing. They also don't want to pay a $25.00 delivery fee and usually nobody is home during the day to receive a delivery. That was not the case back in the 60s.

Personally, I like going downtown to shop but it is inconvenient so I don't go often. With all the construction in the Rideau Centre, the number of stores available is temporarily reduced significantly making it not worth the effort. Driving downtown is not great even on Saturdays. Streets like Bank Street can even be worse on Saturday than on weekdays.

[lrt's friend]

Originally Posted by phil235

Good points. Particularly number 2. There is almost a pathological aversion to paying for parking amongst a good part of the population, even when the costs are really quite low. I guess it's a question of the immediate outlay of money versus the more abstract idea of operating costs. That isn't likely to change any time soon, as I can't see suburban parking becoming a paid commodity anytime soon.

Agreed, the perception of free parking and the cost of driving being something not considered has been engrained in most of the public since the 1950s. It will be really hard to change this, without offering a major alternative transportation model. This may be coming but ever so slowly.

[phil235]

Originally Posted by lrt's friend

Agreed, the perception of free parking and the cost of driving being something not considered has been engrained in most of the public since the 1950s. It will be really hard to change this, without offering a major alternative transportation model. This may be coming but ever so slowly.

A timely article at Citylab:

http://www.citylab.com/cityfixer/201...-spots/384509/

[J.OT13]

The roll out into Canada was badly planned. You don't open 100+ stores within 2 years. You need to do it slowly to test the market, like Nordstrom.

That said, closing everything in one shot is an even bigger blunder. There has got to be a few stores in the black. You can't just look at the global numbers, you need to look at each individual store.

[phil235]

Originally Posted by J.OT13

That said, closing everything in one shot is an even bigger blunder. There has got to be a few stores in the black. You can't just look at the global numbers, you need to look at each individual store.

It seems to be the supply chain that is the issue. You can't keep that going for just a few stores.

I'm trying to remember how Walmart did it. I think the roll-out schedule was similar, although they definitely didn't close Woolco stores for two years before converting them.

I don't understand why they didn't try to sell the stores as a going concern. Maybe they expect to do better through the bankruptcy process.

[Capital Shaun]

Originally Posted by Kitchissippi

Although I was half kidding about the Shoppers Drug Mart thing, I think the Loblaws/SDM conglomerate is powerful and rich enough to set up a new made-in-Canada mid-market department store. They already have a lot of the pieces — Joe Fresh, PC branded housewares, etc. — plus a massive integrated distribution system. Someone give Galen Weston Jr. a call....

Interesting...

[eternallyme]

Originally Posted by Capital Shaun

Interesting...

They would need to go slow though...but the concept is certainly there.

[Capital Shaun]

Originally Posted by acottawa

St Laurent is a disaster, not idea what could go there it is too close to trainyards and st laurent mall. I could see Walmart taking a crack at a few other locations.

Closing the store down for a couple years was a big mistake. A lot of the clientele moved on & never came back. The store hasn't been open long enough to recapture any of it (assuming it ever could).

I'm still amazed how it only took a few months to convert the Zellers at Gloucester mall into a Walmart. It was open even before the interior renovations were completed.

[rocketphish]

Target stores closing; hundreds of Ottawa retail employees to lose jobs

Vito Pilieci, Ottawa Citizen
Published on: January 15, 2015, Last Updated: January 15, 2015 11:25 AM EST

Hundreds of retail workers at seven Target locations in Ottawa and its immediate surrounds will find themselves looking for a job in the coming months as the major American retailer wraps up business in Canada.

Target Corp. said Thursday it will abandon its operations in Canada in a “fair and orderly” exit after less than two years, putting an end to a mismanaged expansion that racked up billions in losses.

It’s the second time in a little over two years for many of those employees. They were former Zellers workers that were laid off by the Canadian retailing institution before being hired by Target, which constructed an elaborate, $1.8-billion real estate deal to see Zellers vacate choice retail locations across Canada.

In Ottawa, Target has several prime retail locations including a store that was set to open in a key spot in the Bayshore Shopping Mall’s recent multi-million renovation.

It also has locations at Billings Bridge Plaza, Hazeldean Mall, Place d’Orléans and on Merivale Road and St. Laurent Boulevard, as well as a store in Smiths Falls and two in Gatineau.

At the Hazeldean Mall outlet in Kanata, employees were called in to a meeting to hear the news around 9 a.m. But by that time at least one employee had heard the news independently.

As the morning went on some employees stood in small groups talking while shopping traffic was light.

None wanted to be identified in interviews, but several spoke of surprise. They knew Target had lost money, but the store has been open only since the fall of 2013 and no one expected it to close so soon.

One man who works at another retailer in the mall said he has known Target staff since many worked in the earlier Zellers store there.

He said Target staff beat their forecast for Black Friday sales by well over 50 per cent and many were optimistic because this store had been profitable. However keeping the shelves full has remained a problem.

When the announcement came, staff hired for the new Bayshore store had just arrived for training at Hazeldean and were all sent home, he said.

“One fellow came out and said, ‘I’ve been unemployed for 2½ years and when I finally get a job if only lasts an hour.’ “

“It’s a bad day,” said one employee on a break outside the store. “It’s been rumoured since Day One that we might close.”

Staff have been told the store is expected to close in 16 weeks.

Target’s Canadian division, which employs 17,600 people, is seeking court approval to begin liquidation, the Minneapolis-based retailer said Thursday in a statement. The move will lead to a $5.4-billion writedown this quarter, as well as $500 million to $600 million in cash expenses. Still, the shutdown will lead to higher profit by next year, Target said.

Fixing the Canada unit, which had amassed more than $2 billion in operating losses since 2011, has been a top priority for Chief Executive Officer Brian Cornell. After taking the reins in August, he spent a portion of his early days at the company touring operations in the country. The woes plaguing the company’s 133 stores there ranged from empty shelves to prices being higher than locations in the U.S.

“We were unable to find a realistic scenario that would get Target Canada to profitability until at least 2021,” Cornell said Thursday. “This was a very difficult decision, but it was the right decision for our company.”

This is the first major strategic shift made under Cornell, who took over for Gregg Steinhafel after the hacker attack and a broader sales slump led to the previous CEO’s ouster. Steinhafel had seen Canada as burgeoning market for Target, the second-largest U.S. discount chain, because so many Canadians already knew the brand and would cross the border to shop at American stores.

The Canadian division had hoped for a turnaround during the holidays, but it didn’t come, Cornell said Thursday. Target had just opened three additional stores in the country in October.

The U.S., meanwhile, is performing better than expected, the company said Thursday. Same-store sales at its U.S. locations will increase by 3% this quarter, topping a forecast of 2%, thanks to more online purchases and store visits than predicted.

with files from Bloomberg News and Tom Spears, Citizen staff

http://ottawacitizen.com/business/lo...s-to-lose-jobs

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[Beedok]

I wonder if the Bargain! Shop will grab some locations. I mean they're usually a bit smaller, but with such a large glut they might be able to try out a few larger stores.

[eternallyme]

Originally Posted by Beedok

I wonder if the Bargain! Shop will grab some locations. I mean they're usually a bit smaller, but with such a large glut they might be able to try out a few larger stores.

Most of the growth these days is at the ends of the retail spectrum, so that is possible.

[Mikeed]

Considering the sustained losses, the lack of progress in 2014 after doubling down on the expansion and the writing on the wall that the wind is getting taken out of the Canadian economy due to the global oil glut in 2015/2016, while the US econ should ruther ramp up- this makes sense. I wonder if this will make other US brands take notice. Good for Loblaws Company Limited. (who own Shoppers now)

[Mikeed]

Originally Posted by J.OT13

The roll out into Canada was badly planned. You don't open 100+ stores within 2 years. You need to do it slowly to test the market, like Nordstrom.

That said, closing everything in one shot is an even bigger blunder. There has got to be a few stores in the black. You can't just look at the global numbers, you need to look at each individual store.

The supply chains in these type of stores require a certain scale and it really is all of nothing. A DC can't really supply the 10% stores that are making slim profit.

[MoreTrains]

Originally Posted by phil235

It seems to be the supply chain that is the issue. You can't keep that going for just a few stores.

I'm trying to remember how Walmart did it. I think the roll-out schedule was similar, although they definitely didn't close Woolco stores for two years before converting them.

I don't understand why they didn't try to sell the stores as a going concern. Maybe they expect to do better through the bankruptcy process.

Walmart also didnt try opening a huge number of stores all at once. They built a couple in major areas and once there was a good system in place they simply expanded it. I am pretty sure that it took 5 or 6 years before all the Woolco locations were taken over. And even then Walmart is still expanding at a steady pace and not trying to convert overnight.

[Radster]

So when do they start liquidating the stores? Will they go about it like Zellers did? If you were quick enough, there were some amazing deals back when Zellers was closing.

[eternallyme]

Of the Ottawa locations, the one on Merivale Road is probably more of an opportunity than a loss. That is an area that is in fairly high demand (still) for retail, with little room to expand. With about 120,000 square feet now available, at least a lot of it could go to a bunch of retailers (unless someone wants it all at once) in great real estate with few constraints.

[1overcosc]

Originally Posted by Radster

So when do they start liquidating the stores? Will they go about it like Zellers did? If you were quick enough, there were some amazing deals back when Zellers was closing.

I know. My house is full of stuff I got from a massive liquidation sale in 2012.

[phil235]

Originally Posted by MoreTrains

Walmart also didnt try opening a huge number of stores all at once. They built a couple in major areas and once there was a good system in place they simply expanded it. I am pretty sure that it took 5 or 6 years before all the Woolco locations were taken over. And even then Walmart is still expanding at a steady pace and not trying to convert overnight.

According to Wikipedia, so it must be true, the roll-out was quick:

Walmart Canada was established in 1994 from the acquisition by Walmart Stores Inc. of 122 Canadian leases of Woolco, a troubled subsidiary of Woolworth Canada. [5][6] The same year, these Woolco stores were renovated and converted into the Walmart banner

A big difference seems to be that Walmart didn't close the stores for 1-2 years before re-opening. They likely never lost the Wooco clientele. Another difference is that they kept the Woolco staff.

[gjhall]

Originally Posted by Kitchissippi

Although I was half kidding about the Shoppers Drug Mart thing, I think the Loblaws/SDM conglomerate is powerful and rich enough to set up a new made-in-Canada mid-market department store. They already have a lot of the pieces — Joe Fresh, PC branded housewares, etc. — plus a massive integrated distribution system. Someone give Galen Weston Jr. a call....

Isn't that basically what Superstore and the newer, larger Loblaws stores are when you think about it?

[eternallyme]

Originally Posted by phil235

According to Wikipedia, so it must be true, the roll-out was quick:

Walmart Canada was established in 1994 from the acquisition by Walmart Stores Inc. of 122 Canadian leases of Woolco, a troubled subsidiary of Woolworth Canada. [5][6] The same year, these Woolco stores were renovated and converted into the Walmart banner

A big difference seems to be that Walmart didn't close the stores for 1-2 years before re-opening. They likely never lost the Wooco clientele. Another difference is that they kept the Woolco staff.

Many who work in Walmart even today were still originally hired by Woolco. All renovations were done with stores open too, mostly in the summer and fall of 1994.