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Target hopes leadership change can improve results in Canada

The executive shakeup in Canada comes two weeks after the abrupt resignation of Target's CEO and Chairman Gregg Steinhafel

Target hopes a new CEO can improve the retail giant's troubled Canadian operations
Photo: CTV News

Target has fired the president of its troubled Canadian operations, Tony Fisher, and is replacing him with a 15-year U.S. company veteran.

The executive shakeup in Canada comes two weeks after the abrupt resignation of Target's CEO and Chairman Gregg Steinhafel.

The third-largest U.S. retailer announced Tuesday that Mark Schindele, 45, who was senior vice-president of merchandising operations, will now run the Canadian operation. Target's expansion into Canada last year marked its first foray outside the U.S. but it has struggled with weak sales and losses. The changes are effective immediately.

Schindele has played a key role in launching new store format including an expanded grocery area, as well as Target Express and CityTarget in the U.S.

He has also led a global team and provided senior-level oversight to Target's merchandising operations, including systems, global sourcing and product development.

Schindele will report to Kathee Tesija, chief merchandising and supply chain officer, whose responsibilities include Target Canada.

Target, based in Minneapolis, also said that it will be naming a nonexecutive chair in Canada. In its newly created advisory role, the chair will provide counsel and support to the president of Target Canada to ensure all strategies and tactics align with the Canadian marketplace.

The company also announced the promotions of three senior merchandising executives in its U.S. division as it tries to be more nimble in bringing in trendy products into stores more quickly.

Target is trying to fix its flailing operations in Canada, its first foray outside the U.S., while revitalizing business in the U.S. It's also trying to recover from a massive data breach in the U.S. that has cost it customer trust.

The botched Canadian expansion and the data breach were the two main factors behind Steinhafel's departure. Target's Chief Financial Officer John Mulligan is serving as interim CEO as Target searches for a new leader. Steinhafel agreed to serve as an adviser during the transition.

Under the leadership of Fisher, 38, the company opened more than 100 stores north of the border. But shoppers have complained that prices are too high, and the Canadian stores have been wrestling with inventory problems. Fisher had been a company veteran for 15 years.

As a result, sales have been weak, and the company's Canadian operations recorded a loss of $941 million in its first year, shaving off $1.13 per share from the company's results.

While both Fisher and Schindele are from the U.S., 90 per cent of the team working in the Canadian operations are Canadian, Target said.

``We are grateful to Tony for leading Target's first international launch,'' Mulligan said in a statement. ``One of our key priorities is improving performance in Canada more rapidly, and we believe it is important to be aggressive.

``Mark's broad understanding of the retail industry and his record of leading global operations will help accelerate efforts to drive improvements across our Canadian business.''

Dustee Jenkins, a Target spokeswoman, said Schindele will move to Toronto and will focus on inventory, operations and improving the guest experience.

In the U.S., Target said, Trish Adams has been promoted to executive vice-president, apparel and home, while Jose Barra has been promoted to executive vice-president, essentials and hardlines.

Keri Jones has been promoted to executive vice-president,
merchandising planning and operations. All three had been senior
vice-presidents.

``Moving more quickly to bring bold, innovative ideas to the marketplace will help us connect with our guests in more meaningful ways,'' Tesija said in a statement.

Target's net income fell 34.3 per cent to $1.97 billion in the year ended Feb. 1. Revenue slipped 1 per cent to $72.6 billion.

Target is expected to report first-quarter financial results Wednesday. The company said the timing of the changes were unrelated to the company's first -quarter results.

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  1. john posted on 05/20/2014 11:21 AM
    i have a ideal how to improve how about having prices the same as the USA !
    1. HP posted on 05/20/2014 12:19 PM
      @john It goes beyond pricing...those of us that were involved in The Home Depot and Lowes expansion into Canada understand what Target is going through. It's a huge cultural shock for them...Canadian employees don't have the American work ethic, the Quebec stores will want to unionize, managers won't work 60 hour weeks, they'll need to open a French translation department in head office to be able to work in Quebec as well as anywhere in Canada in both official languages, they can't bring American inventory into Canada because the packaging and use/care labels must be French/English bilingual (not English/Spanish), Canada is very class conscious...managers don't mix with the workies.

      ...Home Depot fired all their Canadian executives and brought up VP's from Atlanta, now Target is trying the same thing. If they try to maintain their American corporate culture here, they're doomed. Pricing really doesn't matter, Target is not the cheapest retailer I the U.S. either.
    2. James N posted on 05/20/2014 12:52 PM
      @HP Well, pricing is a major factor. People that walk into Target expect the old Zellers / Wal-Mart pricing. They expect inventory and similar products to the U.S. stores.

      Granted I understand the hurdles that Target must overcome to have products repackaged for the Canadian Market, it also doesn't help that the Canadian government imposed a number of rules to allow them to sell in Canada.

      I am not sure how to read your comment about Canadian and their work ethics. I think Canadians do not put up with the antics that U.S. companies put on their U.S. workers such a making them clock out at closing time yet sill have them stay around to clean up the stores.
    3. HP posted on 05/20/2014 03:18 PM
      @James N American companies moving to Canada are surprised by the Canadian work ethic, especially in Quebec.

      In America, workers are expected to work unpaid overtime, get fewer hours, little or no benefits, work as a team, there are no badges of rank, everyone pulls together and will do other jobs in the store to help out. American employees are subject to drug tests, can't do that here.

      In Canada, everyone has a job description, works their hours and no more. In Quebec it's about lifestyle, people don't work extra hours when they could be at the bistro having a glass of wine, managers don't mix with the plebs, managers are in a different class. Unions rule in Quebec, all retailers follow union protocol even if they're not unionized.

      Essentially, American workers, especially in the Right to Work states are treated as slaves, even Walmart had a food drive for their employees at one store last Thanksgiving so that they had some food on the table...much different here, but at least Canadians have health plans under OHIP.

      Just a long way of saying that companies like Home Depot had a tough time learning that Canadians will not work like Americans, we want respect and will not work 60 hour weeks. And Canadians will not work as hard as Americans to keep heir jobs.
    4. Karl Burgin posted on 05/21/2014 09:38 AM
      @HP {ricing is a huge factor. But I also heard that another big issue is that there isn't as much product in the Canadian Target vs the American Target.
      The U.S. Target, there so much different types of stuff you could buy. In the Canadian version, it seems as though its sorely lacking- almost like a Zellers look-alike.
      I suppose thats the one-two punch thats killing Canadian Target stores right now.
  2. Pat posted on 05/21/2014 08:40 AM
    The Canadian Target is still missing online shopping and competitive prices. I am not going to take the risk to drive there in person to see if they have what I am looking for.
    1. john posted on 05/21/2014 02:10 PM
      @Pat with the way the price of gas is i agree .
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