Target’s losses could spell better deals for Canadian shoppers
Target Canada’s financial performance appears to be, well, slightly off-target. We knew the big-box retailer was struggling after its much-hyped foray into Canadian territory last March, and a recent customer-data breach certainly hasn’t helped bolster shopper confidence. Now the company’s northern arm has chopped its fourth-quarter profit forecast almost in half, predicting a loss of 45 cents per share for its 124 Canadian stores, The Globe and Mail reports. The dismal numbers have led retail analysts to speculate that Target’s Canadian expansion might not be profitable for years—a bleak picture given the company’s optimistic prediction that it would start making money by the end of 2013.
All this is bad news for Target stockholders, but potentially good news for Target shoppers. CIBC retail analyst Perry Caico predicts that Target could be forced to slash prices in order to lure customers back into the shop—a move that could score points with bargain-hungry Canadian customers, who have in the past complained about slightly higher prices here than in American stores.
Of course, it’s not all doom and gloom for the retail giant. The company has had tonnes of success with designer collaborations, especially its Fall capsule collection with 3.1 Philip Lim. Next up is a highly anticipated collection from London label Peter Pilotto, which hits Target stores Feb 9—and will no doubt attract a flurry of foot traffic from fashion-forward Canadians.