Shoppers searching for deals lift Target returns
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Feb 02, 2015  |  Vote 0    0

Shoppers searching for deals lift Target returns

News that Target is closing down operations in Canada has increased sales at stores by $30 million

OurWindsor.Ca

It seems that Target going out of business has finally convinced Canadians to shop there.

According to new documents filed in Ontario Superior Court, total sales at Target Canada were nearly $30 million higher than expected for the period Jan. 15 to Jan. 24.

The Minneapolis-based discount retailer announced Jan. 15 it will shutter all 133 stores in Canada, pulling the plug on its first expansion outside the U.S.

The liquidation sale in stores is not scheduled to begin until at least Thursday, but shoppers have been flocking to Targets since the shutdown was announced.

According to the court documents, Target expected to ring up about $52 million in sales during the period. Instead, it raked in $81.5 million.

“Management attributes this variance primarily to greater than anticipated interest in the retail stores following the announcement of the (creditor protection) and the Orderly Wind-down,” reads the first report of the monitor in the case, Alvarez & Marsal Canada Inc.

Many Targets are expected to close by March, and all stores in Canada are to be closed by May 15.

The Canadian store leases and other Target properties are also expected to go up for sale this week.

In the U.S. meanwhile, Target Corp. will for the first time open more small-store formats than suburban big box stores this year as it looks to urban areas for growth.

The stores in Canada ranged from approximately 80,000 square feet to 140,000 square feet.

Target announced will open two TargetExpress stores, at about 20,000 square feet each, in Chicago and Washington, D.C.

The company had already announced five other new TargetExpress locations for this year — one in St. Paul, three in the San Francisco area, and one in San Diego.

The retailer opened its first TargetExpress store last summer near the University of Minnesota where it has recently been tweaking the assortment, adding baking supplies, sunglasses and yoga pants.

Target said it is exploring other markets such as Philadelphia and Los Angeles.

“Our store growth looks different today than it did five years ago, driven by guests’ expectations for ease and personalization of their shopping experience,” said Tina Tyler, Target’s chief stores officer.

Smaller store formats have been of particular interest to Target’s relatively new CEO, Brian Cornell, who has pointed to TargetExpress and CityTarget as one of the engines for the retailer’s future growth, especially as Target prepares to exit Canada.

The company has already said it would bring its mid-size store format, CityTarget, to the East Coast this year with a store set to open in Boston. It has another location slated for Brooklyn, N.Y., next year. The retailer already operates eight CityTarget stores in cities such as Chicago, Los Angeles and Portland.

On top of that, Target will open six of its more typical suburban big box stores this year, including two in Hawaii. It has about 1,800 stores in the U.S.

- With files from Toronto Star news services

Toronto Star

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