‘Warehouse One’ Increases Mall Presence in Western Canada Amid Strategy Shift

Winnipeg-based denim retailer Warehouse One is expanding its presence in Western Canada after having recently opened two stores in major shopping centres, with more to come. The retailer is seeking to shift some of its operations to highly productive malls that feature ample foot traffic.

Founded in 1977, Warehouse One has created a niche within the Canadian denim market with a chain of 124 stores across Canada that focus on private label men's and women's denim, casual clothing, and accessories. Warehouse One offers a wide selection of denim in the latest styles and washes with multiple inseams.

The chain has typically focused on operating stores located in open air strip malls, power centres, and regional shopping centres in smaller towns such as Gander, Newfoundland, Medicine Hat, Alberta, and Timmins, Ontario. The retailer is now expanding further into major markets with stores in premium malls.

JLL’s Mid-Year 2019 Retail Outlook research report indicated that in Western Canada, retail landlords are redeveloping retail spaces, repositioning existing tenants or bringing new retailers to stay competitive. As a result, the shifting retail environment has created an opportunity for smaller chains such as Warehouse One to open locations in prime shopping malls with more favourable leasing terms as vacancies become common amid numerous store closures.

Neil Armstrong, Warehouse One President, said, "For us, this change in the retail climate has created opportunities that may not have been available to us previously." Warehouse One has seized this opportunity with two new mall locations. After operating a store on Dakota Street in Winnipeg for over 30 years, the store recently moved across the street into St. Vital Centre which is anchored by Hudson’s Bay, Walmart Supercentre and Sport Chek. The new Warehouse One store spans 3,000 square feet and is located in a prime location in the mall near the busy Food Court. The shopping mall attracts more than 170,000 shoppers per week.

Warehouse One also recently opened a 3,700-square-foot store in Edmonton at West Edmonton Mall, located in the mall’s Phase One near the Winners and HomeSense superstore. According to the latest Retail Council of Canada Shopping Centre Study, the mall is the second busiest in the country with more than 30 million visitors annually. By diversifying into more mall locations, Armstrong said, "It’s a chance to increase revenue by double digits. We may be paying a bit higher in rent however the additional revenue will help to offset costs."

Both new stores represent the newest generation of Warehouse One. The stores are bright and spacious with the use of modern elements such as metal and faux wood. The fixtures are all on casters so that as the merchandise changes, the footprint of the store can be easily modified. To assist with moving fixtures quickly and efficiently and also cleaning, the entire store features laminate flooring. The fitting room area is unisex which allows the rooms to be better utilized reducing customer wait times. There is also a lounging space in the fitting room area that provides seating areas for the entire shopping party. The stores provide a great balance between merchandising and lounging -- this creates an enticing space for shoppers to spend more time in the store and hopefully translating to increased sales.

Warehouse One also recently relocated from a power centre to a major shopping centre in Nanaimo BC when the retailer moved its store into the Woodgrove Centre.

Looking further into 2020, there are more mall opportunities for Warehouse One. This spring, a store in Grand Prairie Alberta located in Prairie Plaza will move into the busy Prairie Mall. The store will be located between Visique Eye Care and Hallmark.

Warehouse One is also focusing on customer service through its in-store Jean Enthusiast’s that are provided with customized denim product knowledge training to help customers find the right pair of jeans.

Canadians are becoming more value-conscious and frugal with market polarization accelerating in the Canadian retail sector. Luxury and value retailers are growing while mid-priced retailers such as Warehouse One are being squeezed. Adapting to the changing retail landscape has helped Warehouse One stay ahead of the competition. We’ll follow Warehouse One as it continues to adapt and look to the future.