In 2013, Target's planned expansion into Canada provided limited returns and a nearly $1 billion loss. Now company officials have identified supply chain problems as the cause, said a Reuters report.
Myriad problems contributed to the shortfalls
Three distribution centers and 124 stores opened across the provinces last year, but customers found empty shelves, poor selection and higher prices. Workers told the news service that inventory control had created problems well in advance of the first store opening its doors. Mark Schindele, Target's top executive, explained they'd do things a little differently if they had the chance.
"With the benefit of hindsight, if we could do it all over again, we wouldn't have opened up that many stores, that many DCs (distribution centers), in that short a time frame. I know that much," said Schindele. "We're now unwinding some of the decisions we made that were based on speed."
Supply chain overhaul
Technology systems contributed heavily to the inaugural problems, workers told Reuters, as shipments coming in to the distribution centers didn't match what was inputted into the company's computer systems. Now that issues have been addressed, Schindele explained, store shelves are more full than before, and customers are seeing product they want to buy.
Training is being implemented to help workers learn how to operate the supply systems. Technology is being reconfigured, and the shipping of goods to distribution centers and stores has been updated.
More products and better marketing
A Global News story detailed how Schindele plans a new marketing campaign and the addition of new products to attract customers back to the stores. The company will add 30,000 new product lines and will also add more to its exclusive product line. Understanding individual markets and regional products is also something the company feels they missed and have worked to train employees about the uniqueness of certain products to different markets.
After making all the necessary upgrades and changes to the company supply chain, Target is cautiously optimistic that they will be able to attract Canadian consumers back to their stores after the opening salvo went badly awry. By offering customers what they've asked for and providing good customer service Schindele believes that they've turned the corner, and he is looking for a very busy fall and holiday season.