Target entering Mexico? Officials deny the rumor

Target, the famous American department store chain, put an end to rumors online that they are opening stores Mexico.

The Target corporation has arrived in Mexico, and is hiring, but it’s just some small offices in Mexico City to handle logistical and strategic aspects of the company, supporting its main operation in the United States.

The company also has offices in countries such as India, China, Vietnam, Thailand, and Guatemala. While local teams collaborate with the headquarters staff in Minneapolis, they don’t sell anything at retail outside the U.S.

On LinkedIn, Target was hiring a Sourcing Manager and Senior Managers of Responsible Sourcing, suggesting a focus on vendor and factory management. The Senior Fabric Engineer role emphasizes driving the Materials Strategy to improve cost efficiency, responsible sourcing, and overall return on investment. The Senior Production Engineer would oversee factory-level activities. 

These positions suggest an effort to structure a sourcing program, establishing connections with national and local businesses before physical store openings.

The rumors suggested that Target is considering entering the Mexican market following the nearshoring wave. Establishing a distribution center in the country could streamline international supply chains, reduce import and export costs, and enhance speed and efficiency in product delivery. 

An earlier international expansion effort — into Canada — famously failed a decade ago. Over 100 stores north of the border closed in two years. Target apparently fumbled on finding convenient locations and meeting customer expectations, according to Harvard Business Review. 

Mexico has proven to be a challenging market for other American retail giants. Once a household name in the US, Sears struggled to adapt to the Mexican consumer’s preferences and shopping habits. Sears also faced stiff competition from local retailers who better understood the market and offered more competitive prices.

Another American chain that failed to thrive in Mexico is RadioShack. The electronics retailer, once a go-to destination for tech enthusiasts in the US, struggled to keep up with the rapid pace of technological advancements and the rise of e-commerce. RadioShack faced additional challenges in Mexico, including high import tariffs on electronics and a lack of brand recognition among younger consumers.

Similarly, Toys “R” Us, once a beloved toy store for children across the US, couldn’t withstand the changing retail landscape and the rise of online shopping. In Mexico, Toys “R” Us faced additional hurdles, including high operating costs and competition from local toy stores that offered a wider variety of products at lower prices.

Target is the third largest discount retailer worldwide, with sales of $109.12 billion, behind Walmart ($611.29 billion) and Costco ($234.39 billion).