What The Target Shakeup Means
The news that Target Canada president Tony Fisher has been ousted certainly adds to the storyline of doom. But one analyst points out the reverse of such a move, which makes it clear that Target is not exiting Canada, “putting to rest that crazy notion,” CIBC World Markets Corp retail analyst Perry Caicco tells us. Expect more aggressive pricing in the second half of 2014, Perry says, because the new company prez is a merchant, and pricing has been identified as a problem. The company also plans to name a non-executive chairman in Canada, who Perry expects to be a big name Canadian. (Is Wayne Gretzky available?)
And he anticipates a focus away from capital investment and further expansion of stores. As for that new Target Canada president, it's Mark Schindele, who was previously SVP of merchandising operations at Target Corp. That other non-executive chairman role will offer "counsel and support to the president" to ensure all strategies and tactics align with the Canadian marketplace, the company said in a statement. The company reported a $1B operating loss the first year up here, as it has aggressively opened 127 stores, with more scheduled to follow. The company yesterday reported a surge in sales in Canada in the first quarter (the colder winter months were a killer, although April was stronger) but an operating loss for Q1 of $211M, up from $205M a year earlier. Sales jumped to $393M from $86M a year earlier, keeping in mind they only had 24 stores open during the same period a year ago.