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HR Can Learn From Target’s Failure in Canada

Jan 22

If you haven’t heard, America’s darling department store chain Target, failed miserably in Canada and will soon close all of it’s locations in Canada.  I like Target.  I like Target way more than I like Walmart.  Target is more expensive, but I think they offer a better product selection, with higher quality, in an environment I like shopping in.  Walmart sometimes scares me.

For those who don’t know, I spent a little over three years of my HR life working in mass retail (not for Target or Walmart). I find it interesting that a store I like so much could fail in an area I consider not much different than my own environment. I’m sure my Canadian friends and readers will have fun with that statement, but when I go to Canada I don’t feel like I’m necessarily in a different country from where I live in the U.S. in Michigan. It’s cold. People like donuts, beer and hockey. I mean, we’re almost Canadian!

Target’s failures in Canada parallel many of our own failures in HR:

1. Target bought out a failing chain in Canada and many of those locations were in bad, or not convenient, areas.  We do this in organizations.  I had a client who was in the most awful area to try and attract talent. I said, why do we just open up an offsite office in the bigger city near by. They lost their minds I would even suggest that. Two years later, after losing out on so much business, they finally did just that.  Location. Location. Location.  How is this an HR issue?  Lack of talent is an HR issue, even if it means part of the strategy is to open new locations or move. Don’t think that’s only a leader issue.

2. Target charged more in Canada, then the U.S.  Nothing pisses off someone more than to find out they’re getting taken.  Canadians that lived close to the U.S. border would go to U.S. Target locations and see lower prices. This kills your brand.  We do this with employees salaries. Once people find out you pay differently based on some silly reason, you’re done.  Well, Tim makes more because when we hired him he asked for more. Okay, why didn’t you raise up Mary’s salary at that point as well? Well, Mary didn’t ask. Dumb!

3. Target wasn’t prepared for growth in Canada and couldn’t keep its store’s shelves full.  No one is impressed by a half empty store, and they won’t come back.  You only get one chance to impress that first-time customer. You also only get one chance to impress that first-time candidate.  Blow it, and they won’t come back, and blow enough of those, and it gets around.  Soon, you are known in your market as the place no one wants to go to work for.

It didn’t help that Walmart had a two decade head start over Target in Canada as well.  Entering a market, you better have full understanding who is on top, and why are they on top.  Target didn’t give Walmart the respect they deserved and the learning they endured breaking into Canada.  They tried to do what was successful in the U.S. I’m sure my Canadian friends will be quick to point out, unlike me, they know Canada isn’t the U.S.!

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