By The Canadian Press - Tuesday, March 5, 2013 - 0 Comments
GUELPH, Ont. – The Canadian launch of discount retailer Target attracted a mix of…
GUELPH, Ont. – The Canadian launch of discount retailer Target attracted a mix of bargain hunters, curious shoppers and even a few pranksters on Tuesday as the company opened three locations in southwestern Ontario.
Just before dawn a handful of locals had lined up at the Guelph, Ont., store, each with different plans for what they’d do once inside. Some people had mental shopping lists, others wanted to weigh it against Walmart, and one group of friends said they would turn the hyped event into a funny YouTube video.
For a department store famed for stocking everything under the sun, the crowd outside seemed just as diverse, and they braved the icy temperatures.
By The Canadian Press - Tuesday, March 5, 2013 at 5:40 AM - 0 Comments
Canadian customers likely to see a difference in pricing
TORONTO – The long-awaited arrival of U.S. discount giant Target means Canadians can now get their hands on the famed bull’s-eye brand’s wares without crossing the border — though the savings here might not match those down south.
The retail chain, which opens its doors Tuesday in three communities west of Toronto, has said Canadian customers will likely see a difference in pricing compared to items carried in its U.S. stores, with the company focused on being “competitively priced” with retailers in Canada.
A spokeswoman for Target Canada couldn’t say exactly how that will play out on shelves in the newly launched Ontario stores in Guelph, Fergus and Milton or the dozens more locations the company expects to open in former Zellers stores across the country.
Pricing depends on a number of factors and it’s difficult to give case-by-case examples or even narrow it down to categories of products more likely to warrant higher prices, Lisa Gibson said Tuesday.
By The Associated Press - Monday, March 4, 2013 at 11:20 AM - 0 Comments
GUELPH, Ont. – U.S. discount giant Target is set to open its first stores…
GUELPH, Ont. – U.S. discount giant Target is set to open its first stores north of the border tomorrow.
Target Canada president Tony Fisher made the announcement today during a media tour of the retailer’s Guelph store in southwestern Ontario.
The Guelph store and two other locations in Fergus, Ont., and Milton, Ont., are slated to launch tomorrow morning.
The Minneapolis-based retailer is expected to open between 125 and 135 locations in Canada in spaces that were once owned by Zellers.
The national roll-out begins in Ontario before moving onto provinces in the West throughout the year and eventually into Quebec.
By The Canadian Press - Thursday, February 21, 2013 at 9:46 AM - 0 Comments
BOUCHERVILLE, Que. – Home improvement retailer Rona Inc. plans to cut 200 full-time administrative…
BOUCHERVILLE, Que. – Home improvement retailer Rona Inc. plans to cut 200 full-time administrative jobs across Canada — about 15 per cent of the total — as it looks for ways to become more efficient and improve the customer experience.
The downsizing is part of the company’s plans to focus on its core businesses and reduce other holdings.
Rona (TSX:RON) also says it’s taking a hard look at its network of big-box retail stores outside Quebec and at its commercial and professional division.
The company is currently Canada’s largest home improvement retailer, with more locations across the country than Home Depot or Lowe’s. Continue…
By The Associated Press - Thursday, February 14, 2013 at 10:55 PM - 0 Comments
NEW YORK, N.Y. – A Tiffany & Co. subsidiary is suing Costco, claiming the…
NEW YORK, N.Y. – A Tiffany & Co. subsidiary is suing Costco, claiming the wholesale club operator has been selling engagement rings wrongly labeled “Tiffany” rings.
The high-end jeweler filed lawsuit in U.S. District Court in New York on Thursday.
Tiffany and Company alleges trademark infringement, counterfeiting, unfair competition, injury to business reputation, false advertising and deceptive business practices. The company says the rings are not in fact Tiffany rings, nor are they in any way properly associated with Tiffany.
The retailer said that a customer alerted Tiffany in November to the sale of what was promoted on in-store signs as “Tiffany” diamond engagement rings at a Costco store in Huntington Beach, Calif.
By Colin Campbell - Wednesday, February 13, 2013 at 12:34 PM - 0 Comments
For five years now, the loonie has been at par with the U.S. dollar, but for a small deviation in 2009. And for all that time, Canadian shoppers have paid more than Americans for the same goods—often more than 20 per cent more, in fact, according to various surveys. A new Senate report last week promised to get to the bottom of this shake-down. What it offered were the same excuses used by retailers: we are a small, less competitive country with border restrictions and geographic challenges that drive up prices.
But is Canada really such an undesirable place to do business? Consumers here are richer on average than Americans, more likely to be employed and far more willing to go into debt to buy things. In the U.S., credit card debt rose just 0.1 per cent in December, while consumer debt just hit a new high in Canada. We are, if anything, a retailer’s dream. Our willingness to buy stuff is part of the rea- son Target and J. Crew are expanding here.
There are a few reasons to explain slight price differences. It costs something to print up French labels. It costs money to transport goods here (but that’s greatly overstated in a country where most people live next to the U.S. border). None of it explains the hefty markups on everything from appliances to cars, some of which are made in Canada.
When the loonie first hit par, retailers and manufacturers said it would take time to adjust. Some have matched prices, proving it can be done profitably. So what’s the real reason for the price gap? It can only be that Canadians are willing to pay more, perhaps because our economy has performed better than America’s. Retailers are charging what the market will bear. And until shoppers take their business elsewhere, i.e., across the border, that won’t change.
By The Canadian Press - Wednesday, February 6, 2013 at 8:22 PM - 0 Comments
OTTAWA – The federal government needs to launch a comprehensive review of its tariff…
OTTAWA – The federal government needs to launch a comprehensive review of its tariff policy to help bridge a yawning price gap between Canadian and American retail prices, a Senate committee said Wednesday.
After studying the issue for eight months, the Senate finance committee said tariffs on consumer imports are not the only, or even major, reason for the price differential, but they are a significant factor and one that government can do something about.
The senators noted that Canada still has an 18 per cent tariff on hockey pants even though it could find no manufacturer still producing them in Canada.
And the problem is compounded depending on when the tariff is applied in the supply chain — by the time it gets to the consumer, the duty could have multiplied two or three times.
“We’re not saying get rid of all tariffs, we’re saying study this and determine if they are appropriate and in most cases they are not,” said Joseph Day, the chairman of the committee.
By The Canadian Press - Wednesday, February 6, 2013 at 6:35 AM - 0 Comments
OTTAWA – Shoppers wondering why a stronger loonie has failed to level prices in…
OTTAWA – Shoppers wondering why a stronger loonie has failed to level prices in Canada and the United States for many products may get some answers today.
A Senate committee that held hearings on price differences between goods in the two countries is set to release its report.
The Senate finance committee heard a variety of reasons why the same goods often have higher price tags in Canada despite the stronger Canadian dollar.
Finance Minister Jim Flaherty told the committee he wants Canadian consumers to benefit from the higher loonie.
The minister has conceded, however, that government policies such as tariffs may be part of the reason for the discrepancy.
The loonie closed Tuesday at 100.38 cents U.S.
By The Canadian Press - Thursday, January 31, 2013 at 2:34 PM - 0 Comments
TORONTO – Sears Canada announced today it is laying off 700 workers — the…
TORONTO – Sears Canada announced today it is laying off 700 workers — the majority from their department stores.
The retailer says 360 people are being laid off from its department stores and about 300 from distribution centres.
The remaining workers are being let go from head office and other support areas.
In a statement, Sears says the move is part of an initiative to restructure its business model.
The job cuts will be across Canada.
Sears Canada has been revamping operations to encourage more customers to return to its stores after years of declining sales, and also to prepare for the entry of numerous U.S. retailers, including discount chain Target (NYSE:TGT).
Earlier this month, Sears had announced it was teaming up with the Aldo Group to design and manufacture footwear lines for their Nevada, Attitude and Jessica brands.
The company has 195 corporate stores, 269 hometown dealer stores, eight home services show rooms and more than 1,500 merchandise pick-up locations.
By The Canadian Press - Tuesday, January 22, 2013 at 8:29 AM - 0 Comments
MISSISSAUGA, Ont. – Walmart Canada will continue to expand its presence over the next…
MISSISSAUGA, Ont. – Walmart Canada will continue to expand its presence over the next year, which will mark the arrival of its main U.S. rival — Target.
Walmart plans to complete at least 36 additional supercentre projects by the end of next January — bringing the total number of locations by then to 388.
The U.S.-based discount retailer also announced Tuesday it plans to expand the company’s distribution network to support its Canadian growth.
Like many retailers, Walmart will face new competition this year when Target opens its first Canadian stores in locations formerly occupied by Zellers.
Walmart has been in Canada since the early 1990s and will have 379 stores by the end of January, including nine to have their openings on Friday.
There will also be two Walmart openings on Jan. 31, bringing the total number of Canadian locations added over the past year to 73.
By Linda Nguyen - Thursday, January 17, 2013 at 2:47 PM - 0 Comments
TORONTO – The head of H&R Real Estate Investment Trust says the decision to…
TORONTO – The head of H&R Real Estate Investment Trust says the decision to purchase Primaris Retail REIT was easy to make in a changing shopping mall landscape that will see the arrival of Target stores in the coming months.
“The dynamics of these malls are going to change,” said H&R President and CEO Tom Hofstedter in an interview Thursday.
“They’re going to improve, they are going to have more people in them. It’s going to drive sales up, and drive rents up, and drive value to our unitholders.”
Popular U.S.-based Target (NYSE:TGT), the No. 2 discount retailer in the United States after Walmart, is set to open the first Canadian wave of stores in 10 Primaris properties starting in March or April. Continue…
By The Canadian Press - Monday, January 14, 2013 at 4:40 AM - 0 Comments
TORONTO – Switzerland’s Swatch Group is buying the Harry Winston retail jewelry and watch…
TORONTO – Switzerland’s Swatch Group is buying the Harry Winston retail jewelry and watch division for US$1 billion in cash and assumed debt from a Canadian mining company, which says the deal will position it well to pursue other opportunities
The seller is Toronto-based Harry Winston Diamond Corp. (TSX:HW), which will be renamed Dominion Diamond Corp. after the deal closes.
“At the time that we purchased the Harry Winston brand, resource investment opportunities for diamonds were rare and expensive following the euphoria of the Canadian diamond discoveries, and the involvement of the large international mining companies,” said Robert Gannicott, Harry Winston’s chief executive.
By The Canadian Press - Wednesday, December 26, 2012 at 5:51 AM - 0 Comments
TORONTO – A new survey from the Bank of Montreal suggests 62 per cent…
TORONTO – A new survey from the Bank of Montreal suggests 62 per cent of Canadians plan to shop on Boxing Day.
One-in-five, or 22 per cent, said they plan to shop for themselves, while 34 per cent said they will buy items for both themselves and others.
The bank says Alberta will see the most spending activity today, with 76 per cent of respondents saying they plan to buy Boxing Day bargains. Atlantic Canada is next at 72 per cent, followed by Ontario at 69 per cent.
Quebec is expected to see the lightest Boxing Day shopping, with just 36 per cent of respondents to the bank survey saying they plan to shop today.
The survey also found that men are more likely than woman to take advantage of Boxing Day sales at a rate of 66 per cent versus 58 per cent.
Overall, says the bank, Canadians plan to spend an average of $1,610 on the holidays this year while retailers rake in almost $60 billion.
The survey of 1,000 Canadians was conducted between Oct. 11 and 16.
The results are considered accurate plus or minus 3.1 per cent, 19 times out of 20.
By The Associated Press - Sunday, November 25, 2012 at 7:07 AM - 0 Comments
Thanksgiving shopping on Thursday took a noticeable bite out of Black Friday’s start to…
Thanksgiving shopping on Thursday took a noticeable bite out of Black Friday’s start to the holiday season, as the latest survey found retail sales in stores fell slightly from last year.
Saturday’s report from retail technology company ShopperTrak estimated that consumers spent $11.2 billion at stores across the U.S. That is down 1.8 per cent from last year’s total.
This year’s Friday results appear to have been tempered by hundreds of thousands of shoppers hitting sales Thursday evening while still full of their Thanksgiving dinner. Retailers including Sears, Target and Wal-Mart got their deals rolling as early as 8 p.m. on Thursday.
Online shopping also may have cut into the take at brick-and-mortar stores: IBM said online sales rose 17.4 per cent on Thanksgiving and 20.7 per cent on Black Friday, compared with 2011.
Yet ShopperTrak said retail foot traffic increased 3.5 per cent, to more than 307.67 million store visits, indicating at least some shoppers were browsing but not spending freely.
“Black Friday continues to be an important day in retail,” said ShopperTrak founder Bill Martin. “This year, though, more retailers than last year began their doorbuster deals on Thursday, Thanksgiving itself. So while foot traffic did increase on Friday, those Thursday deals attracted some of the spending that’s usually meant for Friday.”
The company estimated that shopper foot traffic rose the most in the Midwest, up 12.9 per cent compared with last year. Traffic rose the least, 7.6 per cent, in the Northeast, parts of which are still recovering from Superstorm Sandy.
ShopperTrak, which counts foot traffic and its own proprietary sales numbers from 25,000 retail outlets across the U.S., had forecast Black Friday sales would grow 3.8 per cent this year, to $11.4 billion.
While consumer confidence has been improving, many people are still worried about the slow economic recovery, high unemployment and whether a gridlocked Congress can avert tax increases and government spending cuts — the so-called “fiscal cliff” — set to occur automatically in January.
And some would-be shoppers said they weren’t impressed with the discounts, or that there wasn’t enough inventory of the big door-busters.
“As far as deals, they weren’t there,” said Tammy Stempel, 48, of Gladstone, Oregon. “But businesses have to be successful, too. I’m hoping they extend the deals through December.”
She was waiting in line outside an Ikea in Portland on Saturday to buy pots and pans for her 18-year old daughter — as a hint that it was time to move out. Stemple and her husband went shopping at two Targets, Michaels and other stores Friday, but failed to find any amazing deals, even on a flat-screen TV they wanted for themselves.
Target, Best Buy and other stores near the Ikea seemed to have few customers, and traffic at the nearby Lloyd Center Mall also was light, even for a normal weekend.
Many shoppers around the country were armed with iPads and smart phones, to check prices as well as buy.
Online auction and shoppping site eBay reported more the 2.5 times the number of mobile transactions as last year.
Online retailers worked as hard as brick-and-mortar stores to draw customers, sending each of their subscribers an average of 5.9 promotional emails during the 7 days through Black Friday. That’s an all-time high, according to marketing software company Responsys.
IBM, which tracks more than 1 million transactions at 500 online retailers each day, said its data showed 24 per cent of online shoppers used a mobile device to check out a retailer’s site and about 16 per cent of online purchases were made on a mobile device. But while total online spending rose sharply, the value of the average online order dipped about 5 per cent to $181.22.
In spite of all the TV reports showing shoppers carting away laptops and giant flat-screen TVs, IBM said combined sales of consumer electronics, printers and other office supplies were up only 8 per cent, with average order prices of $326.05.
Sales of appliances and other home goods rose the most, up about 28 per cent from Black Friday last year. Clothing sales rose 17.5 per cent, department store sales grew just under 17 per cent and sales of health and beauty products rose 11 per cent.
Despite the throngs in stores Thursday night and Friday, many shoppers held off until Saturday, hoping for shorter lines and less drama.
“I can’t deal with all that craziness,” said Miguel Garcia, a 40-year-old office co-ordinator who was at a Target discount store in the Bronx, New York, on Saturday. “Compared to what I saw on TV yesterday, this is so much more comfortable and relaxed. I can actually think straight and compare prices.”
Garcia was checking prices for phones and tablets at various stores, and planned to delay any purchases until Cyber Monday when he’d have a better sense of the best deals. As money has gotten tighter over the years, Garcia said he comparison shops more.
“It forces you to become a good consumer,” he said.
Tanya Dunham, a 32-year-old patient co-ordinator representative, likewise avoided the crowds on Black Friday and was shopping at the same Target Saturday.
“I don’t like to wait (in line) just to save $15 or $20,” said Dunham.
For the entire holiday sales season of November and December, ShopperTrak has predicted sales should rise 3.3 per cent over last year. Those two months are crucial for retailers and can account for up to 40 per cent of stores’ annual revenue.
AP Business Writers Candice Choi in New York and Sarah Skidmore in Portland, Oregon., contributed to this report.
By Amanda Shendruk - Friday, November 23, 2012 at 11:54 AM - 0 Comments
It’s Black Friday!
Though it has traditionally been an American “holiday,” during the past few years Canadian retailers have jumped on the discount day. And apparently we don’t mind: A recent CIBC poll conducted by Harris/Decima suggested that 9 per cent of Canadians plan to take advantage of the shopping savings.
Many Canadians will take advantage of the weekend discounts to get their Christmas shopping done—all $674 worth of gifts. That’s right, this year’s Bank of Montreal Christmas spending survey suggests we plan to drop almost $100 more than last year on presents (when each person shed $583 for their loved ones).
Despite worries about an upcoming fiscal cliff-induced recession, both Canadians and Americans plan to increase their Christmas spending. But what about the rest of the Western world?
By The Canadian Press - Tuesday, November 20, 2012 at 3:22 AM - 0 Comments
TORONTO – Canada’s oldest company, Hudson’s Bay Co., plans to raise $365 million in…
TORONTO – Canada’s oldest company, Hudson’s Bay Co., plans to raise $365 million in its initial public offering by selling more than 21 million shares at $17 per share.
The owner of the Bay, Home Outfitters and U.S. retailer Lord and Taylor says the IPO will consist of a treasury offering of 14.7 million common shares and a secondary offering by Hudson’s Bay Company (Luxembourg) of 6.7 million common shares.
Hudson’s Bay said in a release issued late Monday that based on the offering price, the company’s market capitalization will be $2.04 billion.
The offering is being made through a syndicate of underwriters led by RBC Capital Markets, BMO Capital Markets, CIBC and BofA Merrill Lynch.
Hudson’s Bay says the Toronto Stock Exchange has conditionally approved the listing of the company’s common shares subject to fulfilling the customary TSX requirements.
Share trading under the symbol “HBC” is expected to begin on the closing of the offering, expected Nov. 26.
HBC last traded on the Toronto Stock Exchange in 2006 before it was taken private by U.S. businessman Jerry Zucker, who later died unexpectedly. New York-based NRDC Equity Partners acquired the company in 2008 for $1.1 billion from Zucker’s widow.
Since then, the company has been working to transform its stores and revamp its image into a more upscale retailer.
Hudson’s Bay Co. said in a revised prospectus its preliminary results suggest its third quarter revenues were up 3.8 per cent from the same time last year but its margins were squeezed by shortages and seasonal clearance markdowns.
Preliminary results showed total revenue rose to $930.4 million for the third quarter ended Oct. 27.
That’s up $33.7 million from $896.7 million in the comparable quarter last year.
The company, which plans to use the proceeds of the offering to repay debt, said it has improved sales productivity and earnings growth, partially through a capital investment of more than $420 million since 2009, but added it has more work to do.
HBC said it plans to pay a quarterly dividend with a target payout ratio of 20 to 25 per cent of expected net earnings.
By The Canadian Press - Wednesday, November 14, 2012 at 3:58 PM - 0 Comments
MONTREAL – A battle for control of home renovation company Rona was formally launched…
MONTREAL – A battle for control of home renovation company Rona was formally launched Wednesday after the company’s second-largest institutional shareholder said it was seeking to sweep out the existing board and install new directors.
Invesco Canada, which owns about one-tenth of Rona Inc. (TSX:RON) shares, issued the call for change after the chain reported dismal financial results last week and its long-time chief executive resigned.
The unexpected departure of Robert Dutton came two months after he and the other Rona directors fended off a takeover by American rival Lowe’s.
Invesco announced in a brief release Wednesday morning that it plans “to requisition a meeting of shareholders of Rona Inc. for the purpose of removing Rona’s current directors and electing new directors in their place.”
The fund manager declined to comment on what prompted its bold move to replace Rona’s board or indicate what level of support it has mustered from fellow shareholders.
Invesco, which operates Trimark, Invesco and PowerShares brands, controls 12.3 million shares of Rona on behalf of investors.
IA Michael Investment Counsel, manager of ABC Funds, which owns about three million shares representing 2.5 per cent of Rona, said it is backing Invesco’s move.
“We support change, we think it’s due,” company president Irwin Michael said in an interview from London, Ont., expressing his disappointment that Rona’s management and board didn’t pursue discussions with Lowe’s.
Michael said he hasn’t been contacted by Invesco and isn’t sure what kind of support will be offered by other shareholders, including independent owners, which form a large block.
“We don’t know what the independents will say or do. It’s the silent majority that will decide on this,” he said.
“Maybe the Invesco group comes forward with a very interesting board of directors. We’d like to see what they have in mind, but clearly it’s a really positive catalyst for the stock at this point. It’s not a done deal, but nonetheless it’s a positive obviously for shareholders who have been on a wild ride on this.”
Institutional investors are unhappy with years of weak results at Rona and the board’s unwillingness to entertain a $14.50 per share cash takeover bid that represents about a 45 per cent premium from when the company’s stock has traded for much of the past year.
Rona said in its proxy circular last year that $100 invested in the company at the end of 2006 was worth little more than $42 five years later.
“It has been a slow grind for the last five years of destructive shareholder and share price and so something’s got to be done. We start with a resignation from Mr. Dutton, this seems like a logical next step and we’ll take it from there,” added Dana Merber, a colleague of Michael.
Shares were up 3.6 per cent Wednesday afternoon, rising 40 cents at $11.38 on the Toronto Stock Exchange.
But other Rona shareholders were laying low, unwilling to comment on Invesco’s efforts.
The Caisse de depot, Rona’s largest shareholder, said it won’t tip its hand at this point and Dimensional Fund Advisors said it “doesn’t comment on individual companies or sectors.” British Columbia Investment Management Corp. declined comment.
Franklin Templeton said it has nothing to add from the comments Richard Fortin, portfolio manager at Bissett Investment Management, made in September in support of dramatic change at Rona.
“We believe that a strategy which focuses solely on the execution of Rona’s current business plan while excluding all other value creating alternatives (including a potential combination with Lowe’s) isn’t in the best interest of shareholders and is the wrong approach.”
A Rona spokeswoman said the company will likely respond to Invesco’s move on Thursday.
On Monday, it denied a newspaper report that it has received a new takeover offer from Lowe’s or has held discussions with its U.S.-based rival.
Derek Dley of Canaccord Genuity said he’s not surprised that large shareholders are restless but wondered why they’ve waited until now to act.
“We’re a little bit unsure about why this wasn’t something that shareholders that were looking for a sale, why they didn’t do this earlier this summer when the bid from Lowe’s was still on the table,” he said from Vancouver.
Dley said it is unlikely that the Caisse would support Invesco’s move. And independent store owners who control about 10 per cent of Rona shares would likely resist.
“It’s going to be challenging because likely your two biggest shareholders are going to be in support of the current board.”
Nonetheless, Dley expects any move to oust Rona’s board would be a drawn-out process.
Any takeover by Lowe’s would also likely face scrutiny from the Quebec government, which — when in opposition — aligned itself with vows from the Charest government to give Rona the power to block such a move.
Rona currently has nearly 30,000 employees and 830 locations under its banner, giving Rona a bigger reach in Canada than Home Depot or Lowe’s, the No. 1 and No. 2 home improvement retailers in the United States. Home Depot has just 180 stores across Canada and Lowe’s has about 31 Canadian locations, out of 1,745 across North America.
By Chris Sorensen - Monday, November 12, 2012 at 3:08 PM - 0 Comments
The surprise $700 million tie-up between two of Canada’s best-known furniture retailers—Leon’s and The Brick—is being touted as a defensive move in the face of an all-out assault by U.S. big box retailers. They include Target, which is set to begin opening Canadian stores next year. “During these economic times where we have seen multiple American corporations make inroads in our country through acquisitions, it is a pleasure to see two successful Canadian retailers reach such an agreement that will better serve Canadian consumers,” Terry Leon, the CEO of Leon’s, said in a statement announcing the friendly deal.
There is, however, no “category killer” coming across the border that threatens either Leon’s or The Brick directly—at least not in the near-term. Target, Wal-Mart, Home Depot and Lowe’s all sell furniture or major appliances, but it’s not their core focus. Even Ikea, the ultra-successful Swedish furniture chain, isn’t considered a big competitor by analysts because it caters to a different type of customer who is looking for cheaper, do-it-yourself furniture and storage solutions.
Instead, the marriage of Leon’s and The Brick appears designed to boost the profitability of two entrenched Canadian players. In the case of The Brick, the biggest threat to its business until recently has come from its head office in Edmonton. The company nearly bankrupted itself during the last recession when a sales slump was magnified by bad product decisions and poor inventory management. Founder Bill Comrie had to step back into the picture in 2009 and help organize a turnaround that included installing a new management team. Vi Konkle, who became CEO last January, has spent the past two years painstakingly rebuilding The Brick’s back-end operations so that the chain can better match its product inventory selection with customer demand.
While the Brick posted a $3.1 million loss in the second quarter, the most recent period for which figures are available, it was mostly due to the repayment of debentures leftover from its financial restructuring. Leon’s, meanwhile, recorded a 20 per cent drop in earnings to $9 million during the same period, which was blamed on higher marketing costs. Both companies are facing reduced demand from consumers as the Canadian housing market cools.
Under the purchase agreement, Brick and Leon’s will continue to be run as separate brands. The cost savings—and, therefore, increased profitability—will come mostly from the increased heft that comes from buying on behalf of both banners. Both chains will also get a boost when it comes to selling over the Web, a growing business, since they will be able to rely on each others’ distribution networks to get sofas and coffee tables in the hands of online customers.
While all of that will no doubt leave Leon’s and The Brick better prepared to do battle with U.S. big box stores, the question is whether regulators will see the deal as something that actually benefits consumers, or reduces overall competition in the marketplace. It may not be a slam dunk. Hence, both sides have an incentive to talk up the threat from south of the border—even if it hasn’t fully materialized yet.
By The Canadian Press - Wednesday, October 17, 2012 at 8:46 PM - 0 Comments
TORONTO – Canada’s oldest company, Hudson’s Bay Co. will soon be in public hands again after the storied retailer said Wednesday it is going to make a return to the stock market following an upscale makeover.
TORONTO – Canada’s oldest company, Hudson’s Bay Co. will soon be in public hands again after the storied retailer said Wednesday it is going to make a return to the stock market following an upscale makeover.
The owner of the Bay, Home Outfitters and U.S. retailer Lord and Taylor filed a preliminary prospectus for an initial public offering of its shares Wednesday after years of hinting that it is in the works.
By Rosemary Counter - Thursday, September 27, 2012 at 1:40 AM - 0 Comments
The working man’s department store rebrands itself to chase a female demographic
Indifferent shoppers might not notice, but look up: Mark’s Work Wearhouse, the massive Calgary-based clothing retailer best known for it’s firm grasp on the working-male market, is now just Mark’s.
“Research showed that although the name grew us into an enormously successful business, it was limiting our growth,” says Wendy Bennison, vice-president of operations. After 35 years, 380 stores and counting, and a $166-million price tag when Canadian Tire bought it in 2001, Mark’s is rethinking its identity. “The words ‘work’ and ‘wearhouse’ over our door were creating misconceptions about the brand,” says Bennison.
The massive reinvention is now in “full rollout mode.” It began in a 26,000-sq.-foot flagship store in Edmonton, proved similarly successful in Winnipeg and Ottawa, and is moving further into Ontario this fall with 60 updated stores. One of the largest rebrands in the Canadian retail landscape in years, it includes store redesigns, new merchandise, a national marketing campaign and the name change.
By macleans.ca - Tuesday, September 4, 2012 at 8:07 PM - 0 Comments
TORONTO – Hudson’s Bay Co. is planning another run at a public offering in a move that could prepare the company for the onslaught of competition from U.S. retailers next year.
TORONTO – Hudson’s Bay Co. is planning another run at a public offering in a move that could prepare the company for the onslaught of competition from U.S. retailers next year.
A report in the Wall Street Journal says that executives of HBC, which owns The Bay department stores and Home Outfitters in Canada, have retained bankers to consider an initial public offering for the Canadian stores.
The report says an IPO for 30 per cent of the company could be made as soon as this fall or early next year.
A spokeswoman for HBC declined to comment.
Hudson’s Bay was expected to make an IPO last fall with chief executive Richard Baker selling part of his share in the company, though the uncertainty of the market, and holiday retail sales, led the company to set those plans aside.
However, HBC is reconsidering its options as Target Corp. (NYSE:TGT) readies its Canadian launch early next year, while other U.S. retailers like Wal-Mart are also expanding their presence.
Last year HBC sold the leasing rights on more than 200 Zellers locations to Minnesota-based Target, leading to speculation the company could be readying itself for another public offering.
In recent years the company has made efforts to revitalize its The Bay stores, hiring former Holt Renfrew executive Bonnie Brooks as chief executive officer, introducing high-end boutique spaces in its Toronto flagship store and securing the rights to produce uniforms and merchandise for Canada’s Olympic athletes.
Hudson’s Bay last traded on the Toronto Stock Exchange in 2006 before it was taken private by American businessman Jerry Zucker, then passing to NRDC Equity Partners in 2008.
The company also owns retail chain Lord & Taylor in the United States.
By Tamsin McMahon - Thursday, May 10, 2012 at 9:42 AM - 0 Comments
Major retailers are embracing what used to be a guerrilla marketing move by the small guys
Maybe it’s a sign of our disposable culture that the temporary storefront has become a permanent fixture of the retail landscape. Pop-up shops, stores that set up at kiosks or in vacant storefronts for anywhere from a few hours to several months, have flourished across Canada.
In February, ahead of its Canadian debut next year, U.S. retailer Target offered an exclusive Jason Wu collection in downtown Toronto for just six hours, generating a frenzy among the city’s fashionistas and garnering national attention. Well.ca launched a virtual QR-code pop-up shop in Toronto’s Union Station in April. Skincare company Nivea opened “Nivea Haus” in Toronto and Montreal in March. Even the Food Network ran “pop-up restaurants” in Toronto and Vancouver to promote a show.
Pop-up shops have been around for nearly a decade, inspired by the guerilla marketing tactics of small designers who would temporarily inhabit storefronts, warehouses and alleyways because they couldn’t afford their own retail shops. Target was among the first major retailer to try the pop-up concept when it set up on a barge outside Mahattan in 2002. But while such events were once dismissed as passing fads, the pop-up shop has endured as retailers realize the no-commitment storefront is a cheap way to test new products. They also generate buzz with the novelty of get-it-before-it’s-gone commerce. “It’s a great way to create interest,” says Vancouver retail consultant David Gray of Dig360, who argues the concept isn’t used enough. “What’s going to get harder and harder is for it to remain novel. But it’s still so rare, I think it’s a long way from becoming truly mundane.”
By Gabriela Perdomo - Friday, April 27, 2012 at 9:39 AM - 0 Comments
Canadians love their malls and their shopping habits could spur a mall-building boom, according…
Canadians love their malls and their shopping habits could spur a mall-building boom, according to a new report by Colliers International, reports the Financial Post. The report compares spending per square foot in the U.S. and Canada, and concludes that Canada could use a few more malls:
…the country still has a far lower retail square footage per capita than the U.S. market does, making it a ripe growth opportunity for U.S. retailers and international property developers alike.
While the average mall performance in the U.S. was slightly above US$400 per square foot in 2011, Canadian malls yielded an average of nearly US$600 in sales per square foot. Fuelled by a stronger Canadian dollar, Canadian consumers’ retail spending per capita has essentially caught up to U.S. consumers, a trend that began in 2008.
But placing the U.S. as a benchmark has its problems. South of the border, malls are actually shrinking. If anything, since the recession started in 2008 it has become painfully obvious that a country only needs so many shopping malls.
This piece in The Economist illustrates the fate many malls in American suburban areas are facing. They’re being turned into office spaces, because retailers are long gone.
From The Economist:
…many American malls had run into trouble before the recession started, and the country’s nascent recovery is not likely to revive them. America’s retail sector is probably overbuilt; in the fourth quarter of 2011, according to the National Association of Realtors, its vacancy rate was 16.9%.
By Chris Sorensen - Tuesday, November 22, 2011 at 10:20 AM - 0 Comments
The sporting goods store looks to sharpen its image
Landing Sidney Crosby as a pitchman is only the start of Sport Chek’s plan to be a ‘cool’ brand
With its black facade and red-slash logo, Sport Chek is a familiar sight in malls across the country. As Canada’s only big-box sporting goods retailer, it’s a convenient place for consumers to find everything from hockey skates and bicycles to running shoes and golf clubs. But, as its new owner is the first to admit, Sport Chek isn’t exactly known for being a “cool” place to shop—although snagging hockey superstar Sidney Crosby as a pitchman was a step in the right direction.
With competition from U.S.-based retailers on the rise, Canadian Tire (which purchased Sport Chek’s parent company, Forzani Group Ltd., for $771 million earlier this year) has tapped Montreal ad agency Sid Lee to do a complete brand overhaul of FGL’s flagship 139-store Sport Chek chain. “Our goal is to inspire our customers and define the purpose that Sport Chek has in their life,” says Duncan Fulton, the chief marketing officer of FGL. “And hopefully it’s more than a box in the mall where you can buy some stuff and then go out and be passionate about your sport.”
Sid Lee is the ad agency behind Adidas’s latest global brand campaign, its biggest ever, featuring soccer superstars Lionel Messi and David Beckham, the NBA’s Derrick Rose and singer Katy Perry. Amid pounding beats, the spots weave together heroic action from the soccer pitch and basketball court with gritty street-oriented sports like skateboarding and BMX, with a dose of fashion and music thrown in for good measure—basically all of the sports and “lifestyle” categories where Adidas wants to be recognized.
By Chris Sorensen - Tuesday, October 11, 2011 at 11:30 AM - 39 Comments
It breaks every marketing rule, but it’s paying off
The Canadian Tire store on Yonge Street at Davenport Road in downtown Toronto—a few blocks from where brothers John and Alfred Billes opened their first store in 1922, and the location that became the main Canadian Tire store in 1937 (complete with roller-skating stock boys)—is not a very welcoming place these days. Prospective shoppers are greeted by a queue of frazzled-looking customers clutching humidifiers and extension cords at the service counter. They must then negotiate a pair of waist-high turnstiles before browsing aisle after cluttered aisle of merchandise as varied as Canada’s seasons: kitchen utensils, vacuum cleaners, caulking guns, drill bits and sprinkler attachments. Upstairs there’s hockey gear, camp stoves, some toys and cans of tennis balls. Downstairs, auto parts, oil-slicked service bays and, finally, a wall of all-season tires.
Newer stores, located in towns and cities across the country, are brighter and more airy, but largely house the same eclectic inventory—none of it particularly cheap and none of it terribly aspirational either. Customer service, meanwhile, varies wildly from store to store, the result of the company’s independent—and bureaucratic—dealer ownership model.
It all seems like a recipe for retail disaster, particularly as an army of well-oiled U.S. big box chains—Wal-Mart, Home Depot and soon Target—continue their relentless march north of the border. Yet somehow, Canadian Tire remains standing, earning profits of $453 million on $10.3 billion in retail sales last year, which was up three per cent from a year earlier (Canadian Tire Corporation Ltd. also makes money through a banking operation, Canadian Tire Financial Services). “People have been calling for Canadian Tire to fold under the pressure of new competitors for 20 years, and it hasn’t happened yet,” says Jim Danahy, the chief executive of CustomerLAB, a retail consulting firm. “They seem to have a unique relationship with their customers.”