02/17/2015 06:00 EST | Updated 04/19/2015 05:59 EDT

Target Canada bankruptcy leaves TMR company out $50K

Sanjay Barkshani was thrilled to add Target Canada to his cell phone accessory company's list of customers. 

But after a few months on the account, he got a text message saying it was all over. 

"We didn't receive any payment," Barkshani, the owner of Cesium Telecom, told Daybreak. "Then someone sent me a text message with a link that said 'Target is going under.' As soon as I saw that, I said great, our money is definitely jeopardized right now."

Target Canada announced it was closing its stores and entered bankruptcy protection in mid-January 2015, barely two years after setting up its first store in Canada. 

Now Barkshani's company is out $50,000 and will need to recoup at least $300,000 to make up for the total loss.

"It's a substantial amount for anyone. For a company our size, it's a lot of work to get that money back."

Suppliers had no idea stores would close

Barkshani is used to dealing with big retailers. Cesium Telecom supplies cell phone accessories to large chains like Costco, Walmart, and The Source. 

He never expected Target Canada to close its stores so quickly. Now he's learned that even a large retailer isn't a safe bet.

"You think your money is safe. [Target] is coming out of the US, they have deep pockets, so you think you're covered. But I guess after this type of experience, you can see that any company can fail."

Company weighs its options

In mid-January Target Canada filed for bankruptcy protection in a Toronto courtroom under the Companies’ Creditors Arrangement Act.

Target has hired international consultancy Alvarez & Marsal to oversee the liquidation and wind-down process and is now running liquidation sales in many of its stores. 

Cesium Telecom is currently in talks with several companies that have offered 10 to 20 per cent of the money it is owed by Target Canada. 

In exchange, the companies would own the rights to the full amount Cesium Telecom is owed if Target Canada does reimburse its creditors. 

"​It's better to take something than nothing," said Barkshani.

"We could try our best to work with Target Canada and hope they'll give us something, but maybe they will, and maybe they won't. We're trying to make the best of a horrible situation."

According to court documents, Target Canada has to vacate its stores by May 15, 2015.