A little over two years ago, Target Corp. entered the Canadian market at full force, opening 133 stores and employing more than 17,000 staff. Today, the company is withdrawing from its entire Canadian operation, shuttering stores, and declaring bankruptcy protection in Canada. Depending on which news source is reporting, the loss is estimated to be between $2 billion and $5.4 billion. As Target CEO Brian Cornell stated, “Simply put, we were losing money every day.”
Losses happen. Mistakes happen. Businesses shut-down all the time. But, Target making such a giant misstep? And at such a high level? What happened?
This will be an excellent case study for years to come as business analysts examine the operation and look for clues to the massive errors. Among the more obvious errors: differences in suppliers, pricing, stock-outs, distribution network, culture, loyalty, competition, and lack of differentiation.
Group Activities and Discussion Questions:
- Use this case to illustrate how a SWOT analysis grid can be used by businesses. Discuss how to build and use a SWOT analysis grid: strengths, weaknesses, opportunities, and threats (internal and external factors).
- For entering a new market (such as Target entering Canada), break students into teams and have each team build a SWOT analysis grid. Strengths: what is company good at? Weaknesses: what needs work? Opportunities: what is going on in marketplace? Threats: what should company be wary of?
- Based on the analysis, what are the issues and risks that might occur?
- Debrief by building SWOT analysis grid on the white board.
Source: New York Times, Minneapolis Star Tribune, other news sources