What’s happening to Canadian retail, eh?

Posted in Retail
By Laura Leslie on April 6, 2016

A Grocery shopping cart with a Canadian Flag on a white background.

Can you recall the last time you walked past a Jacob, Smart Set or Mexx retailer while shopping in Canada? Do you even remember the brands? October 2014, November 2014 and December 2014 respectively are the dates when each company announced that store closures were beginning to happen. Although Smartset is disappearing under the Reitman’s label, Mexx has vanished from the Canadian retail landscape after being around since the 80s and Jacob only has 6 locations standing. What’s happening to retail companies in Canada and what’s in store for the future of Canadian retail?


Many Canadian companies are facing the fear of closing, or filing for bankruptcy, and some are getting swallowed by giant American corporations. Within the past two months alone Rexall Health was acquired by American drug distributor McKesson, and unable to find a buyer Danier Leather is liquidating all of its 76 locations. With the low CAD dollar, American companies are spreading their roots north of the border and as a result Canadian companies and other competitors are forced to close their doors for good across many verticals. Blacks currently only has real estate online and Future Shop locations were either closed or taken over by Best Buy during March 2015.

The most prominent invasion happening now is the expansion of luxury retail in the Canadian market . Foreign luxury powerhouses like Saks Fifth Avenue, Nordstrom and Prada are opening up flagships across the nation. Cadillac Fairview has welcomed Saks into two properties in Toronto (Eaton Centre and Sherway Gardens) and to accompany the new additions an integrated marketing strategy will soon be launched. With these new additions, along with Holt Renfrew and La Maison Simons’ expansion plans, the luxury market is quickly going to become crowded. According to former Sears CEO Mark Cohen, there might not even be a market.

So, is Canadian retail soon to be a thing of the past? Not quite. Womenswear retailer Aritzia is about to open a Los Angeles flagship location and 7-Eleven Canada Inc. is acquiring almost 150 variety and fuel retail locations from Imperial Oil. Quebec fashion retailer La Maison Simons is beginning a nationwide expansion and Loblaw Companies Limited is still Canada’s largest food distributor looking to make improvements to their supply chain, e-commerce and IT. Strong Canadian brands are stretching past provincial and federal borders and are beginning to wet their toes in technology advancements and international locations.

It’s true that Canadian companies have been slow to adapt to consumer trends. However, a national retailer that some may refer to as “crappy” is now leading the way in Canadian retail innovation. According to president and CEO Michael Medline, Canadian Tire’s goal is to “set a path [for the company] to be a leader in e-commerce in Canada” and ideally hope to make an e-commerce acquisition to pave the way. In order to become the retailer with the advantage, Canadian Tire turned to the one place that would surely get them noticed- Facebook. First, the company turned to Facebook at Work for internal improvements. The platform allows companies to chat, share content, and collaborate through a business account (which is separate from personal pages). With over 85 000 employees, Canadian Tire is the largest Canadian company to use the platform and has developed better internal communications across all levels of employment. Facebook has not only been the answer to increasing company engagement but consumer engagement as well. In exchange for Canadian Tire using the latest software, Facebook reveals useful facts to the retailer. For example: users only watch videos for seven seconds. The marketing team at Canadian Tire then produced 100 social media ads, and half were only seven seconds long. The results? The shorter advertisements had a sell through rate that was 50% higher. Expansion to social media platforms has put Canadian Tire on the map and well on the way to being a leader in innovation. Home to Canada’s oldest loyalty program, which involves distributing paper notes, Canadian Tire has also stepped up their customer experience with a new app and rewards program. The bills however, are still in circulation and can be accepted at some third party locations as valid payment (ie. the “Crappy Tire” burger at The Works). Canadian Tire is a brand that millennials grew up with, and as the population ages, the Canadian Tire organization is continuously adapting to be a trusted brand.

It seems that Canadian companies have hit a slump, but the retail sector itself is still doing well. Retail is the nation’s largest employer with one out of eight working in the industry. Since the US retail market employs two out of every eight people, companies have begun northern expansion to more profitable soil. In order to stay on the map, Canadian companies need to continue to be innovative, provide unique customer experiences and be willing to adopt new technologies. Canadians are proud of their country, it’s time for them to be proud of their brands and retailers too.