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Target Corporation The Canadian Decision Case Solution

Solution Id Length Case Author Case Publisher
1692 757 Words (3 Pages) David Wood, Tarika Menezes Ivey Publishing : W15334
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Target Canada is currently in hot waters reason being many strategic failures which exist at the organizational level. The company is facing intensifying competition, constantly decreasing sales, data breaches which are not only resulting in losses in financial terms but also seriously hampering the reputation of the organization. It is very important to bring some solid reforms in the Canadian Market to benefit from the rapidly growing papulation which also presents retail giant like Target with enormous business opportunities.

Case Analysis for Target Corporation The Canadian Decision Case Solution

Moreover, the stake of Target Corporation in the Canadian market is extremely high that it cannot let the operation run at status quo. As mention in the case, Target Corporation has invested over $148 Million in Canadian Operations, with 133 stores all over the country and 17,600 employees on board. Therefore, streamlining the operations is the utmost desire of management at present.

Starting with the consumer, the management needs to implement a strategy which is aligned with the consumer demographics and preferences in the region. Target needs to look into their merchandize stores in the country as the people in Canada do not prefer to shop from merchandize store as compared to the US citizens. As mentioned, the Canadian goods were relatively more expensive than US merchandize. Therefore, Target must buy merchandize in bulk to gain the economies of scale. When target holds large investor, they will be getting discount from their suppliers and per unit cost of a specific good will decrease. Subsequently, this benefit can be passed on to the end consumer in shape of discount or lower prices.   

As shown in Exhibit 5A and 5B, Target Canada has not been able to meet the consumer expectations. Even though the company crossed $1 Billion revenue, but has resulted in operational loses. The margins for the company were extremely thin which along with heavy financial cost and provisions for income tax. As far as the balance sheet is concerned, the inventory level as part of total assets is still on lower ides. The company reported a net inventory of $683 Million in total assets $5.4 Billion. For a company like Target which inventory intensive organization, such lower level of inventory is one of the major cause of the declining revenues. Consumer prefers one stop shop to buy household goods and tends to walk out of the store if they do not find all the goods under one roof. Therefore, maintaining a higher level of inventory is extremely vital to increase the foot fall.

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