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Friday, January 16, 2015

Why Target Missed The Mark in the Great White North

I'm going to be starting off with some bad news.  Target is closing every single one of its stores for good.

Well...every single store in CANADA that is.

Nearly two years after Target bought out Zellers and transformed many Zellers locations into Target department stores in Canada, the company is now doing an about face and by May 2015, all Target stores in Canada will be closing up shop for good.

This news does not bring a lot of happiness to the now 17,600 people who at the end of the spring will find themselves unemployed, all because the company felt that the one hundred and thirty-three Canadian locations were costing too much money to operate.

But, is that REALLY the reason why Target would close up shop here in Canada?  No, I think there's more to it than that.

For one, people that I have talked to in regards to visiting Target as opposed to other similar retail chains such as Walmart, Canadian Tire, or Giant Tiger have complained that the prices of items in Target stores were priced much higher than those of its competitors.  I can't say that I disagree with that statement.  The closest Target store to me had prices that were almost double what other places sell.  Certainly if prices aren't low enough, people will not stick around to shop.

And I suppose that the 2014 credit card scandal that saw people's personal information being stolen by hackers certainly didn't ease consumers spending habits any, even though it was reported that the Canadian stores weren't as badly hit as the American ones.

But do you honestly want my opinion over why Target flopped in Canada?  Mind you, this is merely my own thoughts, but I honestly believe that the reason why Target missed the mark was because of a lack of understanding and a struggle to believe in the brand by the people who are - or I suppose I should say "were" - in charge.  It's no secret that Target had struggled during its first few months in business.  After all, the business went through two CEO's.  When you have that much uncertainty and instability, it makes it difficult for any business to function the way that it is supposed to.  Just picture a small business which has twelve employees, and all twelve of the employees can't come to a consensus on a decision that will benefit the business.  If all twelve fight with each other, it leads to an endless power struggle and it causes everything to come to a standstill. 

I think something similar happened with Target Canada.  Because of so much turmoil at the top of the chain, the negative effects trickled downward, and this began to impact individual stores in a variety of negative ways from failure to keep shelves stocked to not having enough manpower to open up new stores.  Initially there was a lot of buzz surrounding Target opening up in Canada, and at first glance, it really did seem to be a threat to other retail giants in the country.  The mistake that the company made was expanding too soon, too fast, and every single store suffered as a result of it.

But do I think that anyone tried to do anything about it?  Seeing how empty a standard Target store is on any given day here in Canada, I would probably hazard a guess that they didn't do a whole lot.  I don't even remember seeing that many commercials on television for Target - at least not nearly as many as some of the other retailers out there.  I think that in so many ways, the company missed the mark.  And I think it is frustrating because had they had people at the top who knew what they were doing from the very beginning, I think it could have turned out differently.

In the grand scheme of things, a business - be it a huge corporation, a mid-size operation, or a small Mom and Pop store - needs to do three things in order to make it in this world.

1.  You have to listen to your customer base.
2.  You have to support your team.
3.  You have to have the motivation to make split-second decisions.

Do I think that Target did all of those things?  Honestly, I would have to say no.

Again, one of the most common complaints that I heard about Target Canada from people who have shopped there was the fact that the stock that they did have was overpriced and lackluster compared to the stock that they had in American stores.  Now, granted, there's not a lot that Target could do as far as what items they could carry in the stores.  They're more or less tied to Canadian distribution centres, and have to stock a percentage of Canadian brands.  But I do think that everyone had a responsibility to make sure that shelves were filled.  From department managers to store managers to district managers, there could have been ways to get the product in.  And if the distribution centres were all tied up, then the people in upper management should have done more to try and get the product flowing in. 

I also think that a well-oiled team in retail is one that is consistently supported by their managers, and in turn supportive of each other.  Clearly, Target's decision to close up shop in such a sudden turn of events shows that they felt that trying to salvage the money that was piped into the Target Canada project was more important than keeping the stores open and their employees working.  But in any retail establishment, I firmly believe that people in leadership positions (and this includes district managers, store managers, and department managers) should show qualities that would inspire other people to want to become leaders themselves.  They should try to learn everything they can about the business they work for, they should offer encouragement to all the people on their team, and they should be able to make tough decisions on the fly if the situation calls for it.  They should NOT hide behind their responsibilities to avoid interacting with their team or the customer base.  They should NOT throw a member of their team under the bus to improve the satisfaction of a customer.  They should NOT be nice to team members on the sales floor, and bash them behind their backs in the back room.

Basically leaders should act like leaders.  Not cowards.  Target employees should not have found out about the status of their jobs on the CBC.  They should have been told by the people who employed them first and foremost. 

And, I guess I can ease into the third point right here.  Nothing is more frustrating to deal with in the world of retail than insecurity in decision making.  Believe me, there are times in which the ability to make a decision is tough, but they have to be done to try and keep the business going.  I think in Target's case, decisions were poorly thought out, made way too late, or just completely ignored.  None of which equated to success in the long haul, as far as I am concerned.

The sad thing about this isn't just the fact that thousands of people have now been made jobless.  It's the fact that this sort of thing could happen again.  With businesses like Sears, KMart, and JC Penney struggling to stay alive in this economy, this sort of thing can happen ANYWHERE. 

If the people who run a business stop caring about their employees, the employees will stop caring.  If the employees stop caring, the customers will get upset.  And if the customers are upset, they will go somewhere else.  I think Target Canada could have done more to try and keep the business afloat, and I still take the stance that had Target implemented a plan from the very beginning and worked more with their employees to better train them for the retail industry, then the Target Canada fairy tale might not have such a disappointing ending.

Just something that every business owner should take into consideration.

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