Barely a year after Target opened in Abbotsford, the American retailing giant is pulling out of Canada.
The Abbotsford store, which opened at 1225 Sumas Way in November of 2013, will be one of 133 locations that will close across the country. Those stores represent the company’s entire presence north of the border. It’s unknown when the stores will close.
Target, which employs 17,600 people in Canada, announced the move Thursday morning, citing no foreseeable end to large losses in the company’s Canadian operations.
In 2011, Target announced that it was expanding into Canada by buying the leases of Zellers, a Hudson’s Bay Company subsidiary.
After the Abbotsford Zellers closed in February 2013, Target spent around $10 million to remodel the store, which was forecast to employ between 150 and 200 staff.
“We had great expectations for Canada but our early missteps proved too difficult to overcome,” said Target CEO Brian Cornell. “Personally, this was a very difficult decision, but it was the right decision for our company.”
The company was granted protection from creditors in Ontario Supreme Court under the Companies’ Creditors Arrangement Act.
“The Target Canada team has worked tirelessly to improve the fundamentals, fix operations and build a deeper relationship with our guests,” Cornell said. “We hoped that these efforts in Canada would lead to a successful holiday season, but we did not see the required step-change in our holiday performance. There is no doubt that the next several weeks will be difficult, but we will make every effort to handle our exit in an appropriate and orderly way.”
Target also got court approval to voluntarily place $70 million in an employee trust to “ensure fair treatment of Target Canada employees.”
The move would ensure a minimum 16 weeks compensation, including wage and benefit coverage for workers not needed for the full wind-down period.
Target stores will remain open during a court-supervised liquidation.
-with files from Jeff Nagel