Target may have retreated from Canada, but its competitor Wal-Mart is making a bigger commitment to its business north of the border.
The Bentonville, Ark,-based mass retailer on Wednesday said it will spend about $340 million Canadian dollars, or $240 million, to open 29 new SuperCenters during the company’s fiscal year, which runs from February 2015 through January 2016.
Wal-Mart said it will also expand its distribution network in Canada to support food and ecommerce growth on its Web site, walmart.ca.
The expenditure is part of the company’s previously announced capex or 2016.
“Our mission is to provide multiple access points for customers to save money,” said Dirk Van den Berghe, president and ceo of Wal-Mart Canada. “We will deliver on that commitment through a range of channels including our expanding network of SuperCenters, our accerating e-commerce business and out in-store pick up service.”
The additional SuperCenters will bring Wal-Mart’s store count in Canada to 396 by the end of 2016.
Wal-Mart has been operating in Canada since 1994, when it purchased the Woolco Canada chain from F. W. Woolworth Co. That’s one reason why Wal-Mart has been able to succeed while Target failed. Retail experts said Target didn’t understand the Canadian consumer, its merchandise selection was viewed an inferior to the products sold at Target in the U.S., and its pricing was perceived as being higher than U.S. stores. In addition, Target’s out-of-stock position on many items frustrated shoppers.
Target’s recent decision to exit Canada is evidence of the market’s difficulty, However, that’s not stopping other retailers such as Nordstrom and Saks Fifth Avenue from trying.