Xero, the global small business platform, released on Tuesday its quarterly Xero Small Business Insights (XSBI) report, a snapshot of the health of the Canadian small business (SMB) sector, revealing a significant decline in sales growth in the last quarter of the year.
The report said the data indicates the “uncertain macroeconomic environment and an increasingly volatile Canadian small business landscape.”
“Heightened macroeconomic uncertainty, heavily disrupted supply chains, and shifting trade policy have significantly impacted the Canadian small business economy. We’re now seeing the true cost of a fractured global economy show up at the SMB level,” said Louise Southall, Economist at Xero.
Louise Southall
“The small business sector started last year in a solid position, following earlier policy interest rate cuts by the Bank of Canada. But throughout the year, the general trend in Canada’s small business sales growth slowed, culminating in a decline in sales in the final quarter.”
According to the report, from October to December 2025, Canadian small business sales growth dropped 4.1% year-over-year (y/y), the largest quarterly decline in sales since the September quarter 2020, falling well below the long-term series average of 4.5% y/y.
Despite a solid start to 2025, sales growth slowed each quarter before experiencing a notable decline in the quarter to December. Over the same period, the length of time small businesses waited to be paid remained steady at approximately 27 days (26.8 days in the quarter to December), and late payments improved marginally, with late payments averaging 9.7 days in the December quarter, added Xero.
Regionally, Alberta maintained sales growth results well above the national average over the course of the year, experiencing significant growth in the March, June, and September quarters (+11.0%, +2.9%, and +3.8%, respectively). Meanwhile, British Columbia experienced the weakest result, with sales dropping 8.2% y/y in the quarter to December. Time to be paid metrics showed considerable volatility between provinces from quarter to quarter, but Alberta generally outperformed British Columbia and Ontario, dropping to 26.6 days in Alberta in the quarter to December, explained the report.
Ashalee Mohamed
“In an operating environment that is increasingly irregular and unpredictable, it’s incredibly challenging for small business owners to anticipate demand or make strategic plans right now,” said Ashalee Mohamed, Head of GTM for Canada at Xero.
“While the road ahead is uncertain, Canadian small businesses have proved time and again that they can be agile and resilient in the face of uncertainty. Small business owners should prioritize decisions that are within their control and look for ways to insulate themselves against market uncertainty wherever possible.”
In a market where consumers continue to weigh every purchase, experience-led spending keeps finding room in the budget. Into the Kitchen, a Toronto-based culinary experience business founded by Louise Borins, is leaning into that shift by offering something most diners never see: real, hands-on time inside the working kitchens of some of the city’s best-known restaurants.
Borins describes the concept as an immersive, pre-service experience that places guests shoulder to shoulder with executive chefs and their teams. “It’s a three hour afternoon experience,” she said, adding that it is designed to feel authentic rather than staged. “It’s a three hour organic experience, so I do not tell the route, it’s not staged.”
Louise Borins
While the format has a luxury feel, the business model also taps into a broader retail and hospitality reality. In recent years, many operators have looked for new revenue streams that align with brand identity, protect integrity, and drive repeat visits. Borins believes her concept does all three, while also giving guests a clearer understanding of what goes into a high-ticket meal.
An idea born in 2001, then revived for a different era
Into the Kitchen, as it exists today, is what Borins calls an “iteration two” of a business she first ran in the early 2000s. She traces the origin back to 2001, when she was invited into the kitchen at Centro, then located near Yonge Street, after an experience was raffled at a charity auction.
“I was shoulder to shoulder with the crew,” she recalled. “It was just something that I had never done before.” The experience stayed with her, and she followed up with chef David Lee, eventually building a small business around the concept.
She ran that first version for about 11 years, then paused it while pursuing an executive MBA. After a long gap, she brought it back in 2023, arguing the timing is stronger now than it was the first time. “We felt like it was even more significant today,” she said.
Part of that confidence comes from how consumers have evolved. People still buy premium goods, but a growing slice of discretionary spend has shifted toward access, story, and memory making. Borins sees that every time a guest walks through the door.
The restaurant roster, and why Borins is growing it carefully
Into the Kitchen’s partner network reads like a cross-section of Toronto’s modern restaurant identity, including Bar Prima, Bymark, Capra’s Kitchen, DaiLo, La Palma, Liliana, Lucie, and Mamakas.
Borins said she built the roster deliberately, focusing on culinary credibility, strong leadership, and a range of cuisines. “I was very intentional when I recruited,” she said, noting that the mix spans Greek, Asian-influenced concepts, classic Italian, and French cuisine, among others.
Her approach to growth is also restrained, which is unusual in a market that often celebrates rapid expansion. “I am careful to grow slow and sure,” she said, explaining that she wants to avoid overwhelming partners and ensure the program delivers meaningful business back to the restaurants.
That slow-build strategy is reflected on the consumer side too. She describes much of the business as referral-driven, including introductions through professional circles. “A crew of VC capital guys keep referring me,” she said, adding that momentum has been steady without a heavy marketing push.
A profile in Toronto Life’s holiday gift coverage, which positioned the concept as a standout experience for food lovers, also helped validate the demand for premium, kitchen-level access.
A chef in a kitchen in a restaurant in Toronto
What guests actually do inside a working kitchen
For readers who hear “culinary experience” and picture a classroom-style cooking lesson, Borins is quick to draw the line. She positions the product as immersion, not instruction, and insists it must stay unscripted.
Guests typically arrive in the afternoon and spend three hours in the kitchen ahead of dinner service. Into the Kitchen describes the format as moving “between observer and participant” while engaging in the restaurant’s real operations.
Borins says the experience is tailored to the moment, and also to the guest. “They’re mindful of the client’s interest, dietary preference,” she said, adding that chefs plan the flow in their own way, within allergy and dietary guardrails. The result can range from plating and prep to deeper behind-the-scenes exposure.
She also emphasizes the human element. “There is a relationship that is forged between chef and client,” she said, describing unexpected friendships that sometimes continue after the session. She has seen chefs and guests stay in touch, and in some cases socialize later, which she did not anticipate when she revived the concept.
That relational angle matters because it turns one transaction into an ongoing connection, which is the heart of loyalty, whether in retail, hospitality, or services. A meal can be a one-off. A relationship often drives repeat visits, gifting, and advocacy.
Pricing, packages, and the economics of premium experience retail
Toronto restaurant. Photo: Into the Kitchen
Into the Kitchen lists its base experience at $600 for one participant, with an option to add a second person for an additional $600.
From there, the offering steps up through add-ons that turn the day into a full dining occasion. One package includes a chef’s menu for two served after the kitchen immersion, and another adds wine pairings on top, with pricing and structure outlined on the company’s site.
In conversation, Borins framed the entry price as intentionally accessible for the segment, given the intensity of the access. “To spend three hours with a chef, I’ve come at it truly with an initial price offering,” she said, describing it as a way to build volume and awareness.
She also said she has baked gratuities into the structure and aimed to be transparent with restaurant partners about how revenue is split. “I think it’s really important that the staff is really remunerated,” she said, adding that she wants the experience to feel motivating for the kitchen team rather than intrusive.
That matters because the product is effectively a new retail layer sold inside a restaurant brand. It relies on staff buy-in, operational coordination, and a clear sense that the experience strengthens the restaurant, not distracts from it.
Photo: Into the Kitchen
Pulling back the curtain on food costs, labor, and value
Borins believes one of the most powerful outcomes is education, even when guests arrive simply seeking excitement. In her view, stepping into the back of house helps people understand why restaurant pricing has moved higher, and why margins remain tight.
“When clients go behind the scene and see the work and the expensive ingredients, top notch food ingredients prep, they really are, they have a new awareness,” she said.
That perspective aligns with broader conversations across the industry, where operators have tried to communicate the realities of labor, ingredient inflation, and the true cost of hospitality. Instead of explaining it through signage or social posts, Into the Kitchen makes the point through lived experience, then closes the loop by serving dinner afterward.
It is a reminder that “experiential” is not just a marketing theme. In some cases, it is a practical bridge between a brand’s value proposition and the consumer’s understanding of what they are paying for.
Partnerships and the next stage of growth
Although Into the Kitchen is currently Toronto-centric, Borins says interest from outside the city is real. Vancouver and Calgary have come up in her planning, and she describes expansion as part of a longer-term vision. Still, she is candid about the constraint: her presence is a big part of the product.
“To be quite transparent, I am the ‘into the kitchen’ lady,” she said. “I am the one that meets the clients firsthand. So I cannot replicate myself in that way.”
Instead, she is widening distribution through partnerships that put the experience in front of travelers and high-intent consumers. Into the Kitchen is listed by Destination Toronto as a three-hour immersive experience inside the kitchen of a leading Toronto restaurant.
Borins also pointed to collaborations with premium travel and hospitality players, including a partnership with the St. Regis Toronto that appears on the hotel’s experience offerings, as well as work with luxury travel company Abercrombie & Kent.
From a brand strategy perspective, those channels match the target customer, and they do it without turning the business into a mass-market product. They also reinforce Borins’ preference for controlled growth, strong partners, and reputational credibility.
Why this concept fits Toronto right now
Borins argues that Toronto’s restaurant scene is part of why the model works. “It’s outstanding,” she said, describing the city’s food as seasonal, current, and service-driven. She also believes the professionalism in kitchens, and the culture among crews, creates an environment where guests can step in without the experience feeling chaotic.
In the background, the rise of international validation, including Michelin’s presence in the region, has added to the city’s confidence. Still, Borins frames excellence as the point, not the trophy. “They want to be excellent and more so, they want to have the customer come back again,” she said.
For retail watchers, the takeaway is that hospitality is increasingly behaving like premium retail. The product is not only the meal. It is access, belonging, story, and memory. Into the Kitchen Toronto culinary experience is designed to sell all of those at once, while also feeding demand back into the restaurant brands that make it possible.
Borins summed up her approach in simple terms, rooted in long-term relationships. “When I say partnerships, it’s truly like a friendship,” she said. In a city where consumers collect experiences as readily as they once collected things, that may be the most durable value proposition of all.
“We closed out 2025 with solid operational execution in Q4 amid heightened value-seeking and competitive activity,” said Greg Ramier, Chief Executive Officer of Pet Valu. “Through our decisive actions in 2025, we continued to gain market share, drove growth led by our proprietary brands, and increased units per transaction, all while supporting our franchisees’ success.
“As we celebrate our 50th anniversary in 2026, we plan to strengthen our legacy and leadership in the Canadian pet industry through a continued focus on convenience, quality, value and expertise, while delivering benefits from recent investments,” continued Mr. Ramier. “Together, we expect these actions to support solid revenue and profit growth, enabling compelling returns to shareholders in the near and long term.”
Fourth Quarter Highlights
System-wide sales were $423.7 million, an increase of 9.2% versus Q4 2024. Same-store sales growth was 0.3%.
Revenue was $326.4 million, up 10.6% versus Q4 2024.
Adjusted EBITDA was $74.6 million, up 9.4% versus Q4 2024, representing 22.9% of revenue. Operating income was $48.1 million, up 0.5% versus Q4 2024.
Adjusted Net Income was $34.0 million or $0.49 per diluted share, compared to $32.2 million or $0.45 per diluted share, respectively, in Q4 2024. Net income was $29.4 million, up 1.6% versus Q4 2024.
Opened 14 new stores and ended the quarter with 863 stores across the network.
Free cash flow was $37.0 million, compared to $41.0 million in Q4 2024.
Subsequent to Q4 2025, the Board of Directors of the Company declared a dividend of $0.13 per common share.
Fiscal Year Highlights
System-wide sales were $1,533.5 million, an increase of 5.6% versus the prior year. Same-store sales growth was 1.6%.
Revenue was $1,175.6 million, up 7.1% versus the prior year.
Adjusted EBITDA was $257.1 million, up 4.1% versus the prior year, representing 21.9% of revenue. Operating income was $164.2 million, up 5.7% versus the prior year.
Adjusted Net Income was $113.2 million or $1.61 per diluted share, compared to $113.3 million or $1.57 per diluted share, respectively, in the prior year. Net income was $97.8 million, up 11.9% versus the prior year.
The company is headquartered in Markham, Ontario and has distribution centres in Brampton, Ontario, Surrey, British Columbia and Calgary, Alberta.
Samsung Retail showroom in its Mississauga headquarters. Photo: Samsung Canada
Samsung is giving Canadian media and retailers a hands-on look at how physical stores are evolving. Inside its Mississauga showroom, the company has constructed a fully integrated “store of the future” that demonstrates how immersive retail technology is reshaping merchandising, engagement, and store economics.
Rather than presenting standalone screens or hardware, Samsung has recreated multiple live retail environments within its space. Visitors can walk through scenarios inspired by grocery, big box, boutique, and quick-service formats, each powered by connected displays, interactive touchpoints, and data-driven tools.
For James Arndt, Head of the Enterprise Business Division at Samsung Canada, the decision to build a fully integrated space was intentional.
James Arndt
“Until people can actually envision our product in their environment, it’s difficult,” he said. “We’ve got product in our showroom all the time. We can show what a screen looks like. But when you integrate it into a retail setting, even if it’s not perfect, it gives people context. It lets them see what’s possible.”
From Transactional Space to Strategic Environment
Arndt said retailers are rethinking the role of physical space. Stores are no longer viewed solely as transactional environments. Instead, they are becoming strategic platforms for engagement, storytelling, and monetization.
“Retailers are looking at space differently,” he explained. “It’s not just about putting product there. They need to be strategic. How are they drawing people in? How are they guiding them through the environment?”
Screens, he noted, are increasingly viewed as revenue-generating assets rather than static fixtures. In grocery, for example, a digital display placed near a produce section could feature recipe ideas, sourcing information, or vendor-funded content tied to specific products.
“That allows the retailer to monetize the screen,” Arndt said. “It helps pay for the investment, because it is significant. At the same time, it gives customers more information and engagement.”
The emphasis on measurable return is central to the adoption of immersive retail technology. Retailers are tracking dwell time, engagement, and sales lift to determine impact.
“They absolutely measure it,” Arndt said. “They can look at how long someone stands in front of a display. They can look at lift on a product being advertised. We encourage that, because they need to see the ROI. If they get good ROI, they’ll invest more.”
Samsung Retail showroom in its Mississauga headquarters. Photo: Samsung Canada
Samsung Spatial Brings Glasses-Free 3D to the Floor
One of the most talked-about features in the Mississauga showroom is Samsung Spatial, an 85-inch glasses-free 3D display designed to create depth and motion without requiring wearable technology.
“It’s absolutely next level,” Arndt said. “When you add that third dimension, your content becomes more immersive and eye-catching. People stop and look because it’s cool.”
In the retail setting, a digital mannequin can rotate, model apparel, or demonstrate product features in a way that extends beyond traditional flat signage. The technology aims to capture attention in high-traffic environments where shoppers are often overwhelmed by visual noise.
“You can see a picture of it,” Arndt said. “But it’s nothing until you stand in front of it and go wow. That’s what we’re trying to create.”
The showroom’s popularity has exceeded expectations. What was initially planned as a two-day event has been extended by several days due to retailer interest.
“People are saying their company needs to come and see this,” Arndt noted. “We’re not tearing it down as quickly as we thought we would.”
Samsung Retail showroom in its Mississauga headquarters. Photo: Samsung Canada
E-Paper and Operational Efficiency
While Spatial focuses on visual impact, Samsung’s Colour E-Paper addresses operational efficiency. Available in 13-inch and 32-inch formats, the ultra-low-power displays operate without backlighting and can run on battery power for extended periods.
“Think of it like e-ink,” Arndt explained. “It uses tiny ink bubbles and electrodes to create images. It takes on the ambient lighting in the store.”
Because it does not require constant power, E-Paper can be installed in areas where wiring is impractical. A display suspended above a promotional table, for example, could operate for up to 200 days on a single charge if content is updated only a few times daily.
“It opens up new use cases,” Arndt said. “You can put it at the front cash with a barcode for loyalty sign-up. You can use it for end-cap promotions. It’s flexible.”
Arndt does not expect digital displays to eliminate print entirely. However, he believes the balance will shift over time.
“There’s always a place for print,” he said. “But I do think you’ll see more e-paper and digital signage replacing some of it.”
Samsung Retail showroom in its Mississauga headquarters. Photo: Samsung Canada
Endless Aisle and Inventory Expansion Without Square Footage
Interactive touchscreens are another feature of the showroom, demonstrating the increasingly mainstream concept of the “endless aisle.” These kiosks allow customers to browse and order products not physically stocked in-store.
“As retailers look at space constraints, they may not be able to carry full inventory,” Arndt said. “With endless aisle, customers can order what they want and have it shipped home, or order a size that isn’t available.”
He recently observed the model in action at a small specialty baby store equipped with multiple touchscreen kiosks.
“They might only have one of everything in the store,” he said. “But the kiosks expand the assortment without expanding the square footage.”
For retailers facing rising occupancy costs, immersive retail technology provides a way to extend assortment and increase basket size without enlarging their footprint.
Samsung Retail showroom in its Mississauga headquarters. Photo: Samsung Canada
Canadian Retailers Keeping Pace
Arndt believes Canadian retailers are keeping pace with global counterparts in adopting digital and immersive solutions.
“We’re seeing very strong adoption in grocery and QSR,” he said. “Drive-through technology, loyalty integration, digital menu boards. When I talk to colleagues in the U.S., I don’t see them doing anything better than us here.”
That competitive parity is significant, particularly as global brands continue to invest in flagship environments in Canada’s largest markets.
Samsung’s ecosystem extends beyond display hardware. Through platforms such as Samsung VXT for content management and Samsung Knox for device security, the company supports large chains managing thousands of endpoints. Its mobile ecosystem also enables mPOS solutions and associate mobility through ruggedized Galaxy devices.
The broader objective is to connect digital and physical touchpoints into a cohesive store environment.
Samsung Retail showroom in its Mississauga headquarters. Photo: Samsung Canada
The Human Element Remains Central
Despite the emphasis on technology, Arndt does not foresee a future where staff are replaced by screens.
“I don’t think we’re going to get rid of people,” he said. “When you go to a store, you want that interaction with experts.”
Instead, technology will empower associates with more information at their fingertips. Tablets and mobile devices can provide real-time inventory visibility, product specifications, and payment capabilities without requiring staff to leave a customer’s side.
“It makes people smarter in the moment,” Arndt said. “They don’t have to go check in the back. They can serve the customer better.”
He emphasized that training and support are critical to successful deployment.
“We have to ensure we’re supporting the technology with the staff,” he said. “They need to understand it and know how to use it. That’s most important.”
A Connected Future for Physical Retail
Samsung’s Mississauga showcase offers a glimpse into how immersive retail technology may become embedded across Canadian store networks in the coming years. As displays grow more responsive and data-driven, environments are likely to become more personalized and dynamic.
“You’re going to see environments become more responsive,” Arndt said. “Technology will help everyone who works there become better at servicing customers.”
For Canadian retailers navigating rising costs and heightened competition, the integration of immersive retail technology presents both an opportunity and a strategic imperative. The Mississauga showroom demonstrates that the future of brick-and-mortar is not about replacing the store. It is about reimagining it as a connected, measurable, and experience-driven platform for growth.
Retail investment in Calgary recorded a slower year relative to other asset classes, with total sales reaching $531.5 million by year end in 2025, representing a 31% decline from the prior year, according to a report by Barclay Street Real Estate.
“Transaction volume remained consistent with historical levels, with 54 deals completed and activity evenly split between the first and second halves of the year. The decline in total dollar volume reflects smaller deals across the submarket rather than reduced investor participation. Activity shifted away from the lowest price points, with roughly half of transactions occurring below $5 million and the remainder ranging between $5 million and $54.5 million,” said the report.
“Investors showed greater selectivity, focusing on mid- to higher-quality assets where scale and income stability supported deal execution. Average pricing held steady year over year at approximately $419 per square foot. The largest transaction was the $54.5 million sale of the 201,000-square-foot shopping centre at 388 Country Hills Boulevard NE.”
Calgary’s investment market delivered a year of transition in 2025, characterized by shifting momentum across asset classes and a more selective capital environment, said the Barclay report.
“While overall activity moderated from recent years, investor engagement remained broad-based, supported by strong fundamentals in industrial and multiresidential assets and improving confidence in the office sector,” it said.
“Total investment volume reached approximately $3.26 billion, reflecting a modest pullback from 2024, while transaction activity remained active across all major property types. Industrial and office sectors emerged as key contributors to dollar volume growth, offsetting slower performance in land and retail.”
Overall, the market demonstrated resilience, with sustained deal flow underscoring Calgary’s continued appeal as a diversified and liquid investment destination. Total investment activity in 2025 reached approximately $3.26 billion across 615 transactions, compared to $3.36 billion and 680 deals recorded last year. While both dollar volume and transaction count declined modestly year over year, activity remained historically active, reflecting ongoing investor interest amid a more cautious capital environment, said Barclay Street.
David Wallach
“In a year of recalibration, investors continued to place their confidence in Calgary, supported by the strength of our current fundamentals and a steady flow of capital, speaking to the enduring strength of our market,” said David Wallach, Owner/Broker Barclay Street Real Estate.
Spot & Tango, a leading dog nutrition and wellness brand providing fresh, human-grade products for modern pet parents and sold direct-to-consumer exclusively, has launched in Canada with UnKibble, which it describes as “the first shelf-stable dog food that combines the convenience of kibble with the benefits of fresh food.”
“As a Canadian and lifelong dog lover, I understand how much pet parents care about their dogs’ wellbeing,” said Dylan Munro, co-founder and COO of Spot & Tango who is an Oakville, Ontario native.
Dylan Munro
“With nearly eight million dogs across the country, we’re thrilled to bring UnKibble, the only fresh-dry food for dogs, to families who want the very best for their furry loved ones.”
The brand was founded in 2018 and is based in New York. It has become a best-seller in the U.S. with more than 130 million meals served.
“What dogs eat every day plays a major role in their long-term health,” said Dr. Stephanie Liff, Spot & Tango’s Veterinary Advisor and a NYC-based veterinarian with extensive experience in the pet food and nutrition space.
Stephanie Liff
“UnKibble was thoughtfully formulated using real, human-grade ingredients and a gentle fresh-drying process to deliver complete, balanced nutrition — without the heavy processing typical of traditional kibble. Because it’s vet nutritionist-developed, personalized to each dog, and delivered to the doorstep, UnKibble makes it easier to feed dogs well, every single day.
“I see the impact of high-quality nutrition not only in my patients, but in my own dog, Kyrie, who just turned 10 last week and still acts like a puppy. Her excellent health and energy are a testament to the power of a superior, balanced diet.”
The company said the expansion into Canada comes at a pivotal time as the pet food market is booming in the country and valued at more than $5 billion in 2025 while growing at a rate of 4.46% annually. Dog ownership rates are also at record highs with nearly four in 10 households owning a dog.
Spot & Tango photo
Created for today’s busy dog parents, UnKibble delivers the convenience of shelf-stable food with the quality of fresh, human-grade ingredients (sourced only from trusted suppliers), said the company. Spot & Tango added that it uses a proprietary algorithm to recommend personalized plans, ensuring every dog gets exactly what they need for their size, age, breed, and activity level. Every plan comes with a custom scoop, tailor-made for your dog, to help them maintain a healthy weight while keeping mealtime simple for pet parents.
UnKibble is now available to Canadian customers exclusively through spotandtango.ca.
Russell Breuer
Together with co-founder and CEO Russell Breuer, Munro built Spot & Tango from a personal mission into a US$100 million business. Both were disheartened by store shelves stacked with extruded pellets, mystery meats and lengthy ingredient labels. Their answer was UnKibble, a game-changing approach to canine nutrition that provides dogs with the best of fresh food, without the fridge.
Prior to co-founding Spot & Tango, Dylan was a consultant at McKinsey & Company, where he advised Fortune 500 companies on operations and growth strategy, and led diligences for top-tier private equity and growth equity firms, primarily in the consumer space. He holds a BA in Applied Mathematics with a secondary in Astrophysics from Harvard University.
“2025 marked an important transition year for Plaza with a strong focus on our optimization and intensification strategies, coupled with steady operating fundamentals and a portfolio positioned around non-discretionary retail,” said Jason Parravano, President and Chief Executive Officer in a news release. “Total FFO increased to $44.0 million or $0.395 per unit compared to $40.5 million or $0.363 per unit in 2024, an 8.8% year-over-year improvement, reflecting contributions from same-asset performance, acquisitions completed over the past year, lower administrative expenses due to $2.7 million in reorganization costs in 2024, and the continued execution of our value-creation pipeline, which included various optimization and intensification initiatives. Excluding $123 thousand of reorganization costs, $425 thousand related to a change in bonus accrual timing and $544 thousand of bad debt related to the insolvency of Toys R Us, and excluding 2024 reorganization costs of $2.7 million, 2025 FFO would have been up 4.5% over 2024.”
Jason Parravano
“From an operations standpoint, the portfolio continued to demonstrate resilience. Demand for our space remained healthy, with committed occupancy of 97.6% and leasing spreads at 13.4% based on the average rate over the term. Same-asset NOI grew by 1.7% for the year despite a handful of tenant disruptions that resulted in bad debt adjustments, most notably from the insolvency of Toys R Us. Our exposure is limited to one location, and we are actively working on a plan to reposition the asset. Excluding the bad debt related to Toys R Us, same asset NOI would have increased by 2.5%. This outcome speaks to both the quality of our locations and the strength of our leasing execution.
“In addition to our strong operating fundamentals, over the course of 2025, our intensification, development, and consolidation initiatives added approximately $3.0 million of incremental NOI, reinforcing our strategy of extracting embedded value from the existing portfolio while maintaining financial discipline. Total NOI for the year was $77.0 million, representing growth of 2.7% compared to 2024.”
“We also made meaningful progress advancing projects that will increasingly benefit results in 2026 and beyond. During the year, we handed over multiple spaces to Loblaws and other key tenants for fit-ups and construction across select properties. As these openings stabilize and additional initiatives progress, we expect the impact to become more visible through 2026. At the same time, our optimization work continues to support FFO growth and long-term value creation, even if it can create timing-related noise in AFFO comparisons.”
Plaza is an open-ended real estate investment trust and is a leading retail property owner and developer, focused on Ontario, Quebec and Atlantic Canada. Plaza’s portfolio at December 31, 2025, includes interests in 191 properties totaling approximately 8.8 million square feet across Canada and additional lands held for development. Plaza’s portfolio largely consists of open-air centres and stand-alone small box retail outlets and is predominantly occupied by national tenants with a focus on the essential needs, value and convenience market segments.
Michael Hill flagship at Yorkdale in Toronto. Photo: Oberfeld Snowcap
Michael Hill International has delivered a significant earnings recovery in the first half of FY2026, marking a decisive shift after a challenging period for the Australian-based jeweler. The Michael Hill profit turnaround was driven largely by strong performance in Canada, where record sales and expanding margins helped offset softer results in other markets.
The results, covering the 26 weeks ended December 28, 2025, reflect a leaner cost structure and improved retail execution under new Chief Executive Officer Jonathan Waecker, who assumed the role in August 2025. The period follows a transitional year that included the passing of founder Sir Michael Hill and former CEO Daniel Bracken.
While all regions showed signs of stabilization, Canada emerged as the clear growth engine, delivering high-margin gains in a competitive North American retail environment.
Financial Results Signal Disciplined Recovery
The first half of FY2026 highlights a materially stronger financial position for the group.
Statutory Net Profit After Tax rose 32 percent to AUD $22.3 million. Comparable EBIT increased 28.6 percent to AUD $31.0 million. Group revenue reached AUD $371 million, up 3 percent year over year, while same-store sales advanced 3.8 percent across the network.
Equally notable was the company’s strengthened balance sheet. Michael Hill reported a positive net cash position of AUD $20.7 million, representing a $30.5 million swing from the net debt position of AUD $9.8 million a year earlier. The improvement reflects tighter inventory control, disciplined capital allocation, and operational efficiencies.
Despite the stronger fundamentals, shares declined approximately 5.4 percent following the earnings release. The market reaction was attributed largely to management’s decision to withhold an interim dividend in favour of preserving balance sheet strength. Management indicated a potential return to dividends at the full-year stage.
Canada Emerges as Growth Catalyst
The Michael Hill profit turnaround was heavily supported by record-breaking results in Canada.
Canadian segment revenue increased 6.2 percent to CAD $96.3 million, equivalent to approximately AUD $105.8 million. Same-store sales rose 6.1 percent in the first half. Momentum accelerated further in early second-half trading, with Canadian same-store sales surging 13 percent in the first eight weeks of H2.
The performance stands out given ongoing margin pressure across the global jewelry industry, particularly from elevated gold and silver prices. In Canada, however, gross margin expanded by 70 basis points to 61.5 percent, underscoring disciplined pricing and product mix management.
Company leadership noted continued market share gains in Canada, supported by strong retail fundamentals and curated merchandising strategies. Holiday gift sets resonated with consumers, helping drive higher average transaction values during key trading periods.
For Canadian retail observers, the results reinforce how premium positioning and operational precision can deliver outsized performance even amid cost volatility.
Michael Hill flagship opening at Yorkdale in Toronto. Photo: Michael Hill
Mixed Performance Across Australia and New Zealand
Outside Canada, performance was more varied but generally stable.
Australia remains Michael Hill’s largest market, generating AUD $209.1 million in revenue, up 2.1 percent. Same-store sales increased 4.8 percent, and gross margin improved modestly by 20 basis points to 60.7 percent. The Australian business continues to serve as the group’s foundational earnings anchor.
New Zealand, the company’s founding market, returned to positive sales growth with revenue rising 2.4 percent to NZD $62 million. However, profitability remained under pressure. Gross margin declined 60 basis points to 58.3 percent, and the region recorded a net loss in store count, closing two locations during the period.
While the Oceanic markets provided steady contribution, they did not match the acceleration seen in Canada.
Operational Shifts Underpin Turnaround
The recovery reflects deliberate strategic adjustments implemented by management over the past year.
Inventory discipline was a central priority. The company reduced inventory holdings by AUD $11.3 million, focusing on clearing aged stock and improving stock efficiency. This approach created room for newer, higher-margin product introductions.
Operational efficiencies also improved. Michael Hill negotiated more favourable supplier terms and optimized supply chains, including the rollout of a new distribution centre in Auckland. Capital expenditures across technology and store development were tightly controlled.
In-store execution was refined through a tighter merchandising focus and better product curation. These measures enabled the company to mitigate raw material cost pressures while maintaining profitability.
The combined impact of these initiatives is reflected in both margin expansion and improved cash flow.
Canadian Footprint Anchors Growth Strategy
Canada has evolved from a strategic expansion market into Michael Hill’s most consistent growth engine.
As of early 2026, the retailer operates more than 80 stores across the country, with estimates ranging between 82 and 86 active locations. Ontario accounts for roughly 45 percent of the Canadian fleet, with approximately 37 stores concentrated in high-traffic shopping centres.
British Columbia and Alberta represent the next largest markets, with approximately 18 and 16 stores respectively. The brand also maintains a smaller presence in Manitoba and Saskatchewan.
Rather than pursuing aggressive new store openings, management has prioritized optimizing the existing network. Renovations of top-performing stores and selective closures of underperforming locations are aimed at maximizing capital efficiency and lifting average productivity per square foot.
Flagship Strategy Elevates Brand Positioning
A central driver of Canadian margin expansion is the rollout of new-concept flagship stores designed to elevate brand perception.
In late 2025, Michael Hill opened a new-concept flagship at Yorkdale Shopping Centre in Toronto. The opening coincided with the company’s 45th anniversary and serves as a blueprint for its premium repositioning strategy.
The store departs from traditional jewelry counter formats, embracing a more boutique-style aesthetic with refined finishes and curated displays. The location also introduces higher-margin product tiers not available in all stores, including the Stardust diamond collection and bespoke services such as the Tennis Concierge, which allows clients to custom-build tennis necklaces and bracelets.
Building on this momentum, the company is preparing to launch a second Canadian new-concept flagship at CF Pacific Centre in downtown Vancouver. The centre is widely regarded as one of Western Canada’s premier luxury retail destinations.
By establishing elevated flagships on both coasts, Michael Hill aims to increase average transaction values, attract higher-income clientele, and further enhance gross margins across the Canadian portfolio.
Strong Start to Second Half
Early trading in the second half of FY2026 suggests continued positive momentum.
Across the group, same-store sales were up 6 percent in the first eight weeks of H2. Performance benefited from solid Valentine’s Day trading and Lunar New Year activity, both important periods for jewelry sales.
Canada continues to lead this acceleration, reinforcing its role as the company’s primary earnings growth driver.
Toronto’s east end has welcomed a new entrant into its growing wellness landscape with the opening of VIMALIFE Leslieville, a membership-only fitness and wellness club located at 276 Carlaw Avenue, Unit 101. The 11,000 square foot facility officially opened its doors on December 1, 2025, and recently marked its grand opening with a community event on February 12, 2026.
Positioned as a design-forward club rather than a traditional big-box gym, VIMALIFE is targeting professionals and residents seeking a more curated, community-driven fitness experience. The club arrives as Leslieville continues to evolve, with increasing demand for premium amenities that reflect the neighbourhood’s walkable lifestyle and independent retail culture.
Unlike high-volume fitness operators that prioritize scale, VIMALIFE has intentionally adopted a membership-only model focused on consistency and service. According to the company, the objective is to create a space where members feel recognized and supported, rather than anonymous.
“Leslieville deserves something elevated but still grounded in the community. We wanted to build a club where training is intentional, where the atmosphere helps you stay consistent, and where you walk in and feel taken care of. This is not just a gym opening, it’s a new home base for wellness in the east end,” said Marie-Pier Lalancette, Partner at VIMALIFE.
The club describes its philosophy as blending belonging with excellence. Rather than promoting short-term fitness goals, it emphasizes long-term habit building through structured programming and attentive service.
VIMAFIT Leslieville in Toronto weights area. Photo: VIMAFIT
Bridging Strength Training and Studio Culture
A defining feature of VIMALIFE Leslieville is its integration of a premium strength and training environment with boutique-style studio classes under one roof. The open gym floor supports independent strength and cardio training, while two dedicated studios host more than 200 classes each month.
Programming includes strength and conditioning formats such as HIIT and circuit training, alongside yoga, Pilates, barre-style classes, and personal training. By combining these offerings within a single membership structure, the club is positioning itself between traditional full-service gyms and single-discipline boutique studios.
This hybrid format reflects broader industry trends, as consumers increasingly seek flexibility and variety without maintaining multiple memberships.
VIMAFIT Leslieville in Toronto. Photo: VIMAFIT
“Third Space” Strategy in a Growing Neighbourhood
VIMALIFE Leslieville is also leaning into what many operators describe as the “third space” concept. In this model, the fitness club functions as a space between home and work, offering both physical training and social connection.
Leslieville has long been characterized by independent retailers, hospitality venues, and a strong sense of local identity. As residential density increases across the east end, demand for lifestyle-driven amenities has grown accordingly. VIMALIFE’s launch strategy included partnerships with neighbourhood businesses such as Nut Bar, Greenhouse Juice, Juno Vet, and Moore Kombucha during its grand opening event, underscoring its hyper-local positioning.
By embedding itself within the existing retail and service ecosystem, the club aims to strengthen community ties while differentiating itself from national chains.
VIMAFIT Leslieville in Toronto reception area. Photo: VIMAFIT
Design and Scale: Boutique but Premium
The facility occupies space within a historic industrial building on Carlaw Avenue, an area known for its converted factory lofts and creative workspaces. The club leverages high ceilings and an industrial aesthetic while incorporating a curated, boutique design approach.
At 11,000 square feet, VIMALIFE is smaller than many commercial gyms that can exceed 30,000 square feet. However, the scale is deliberate. It is large enough to offer comprehensive amenities, including luxury changing rooms and towel service, yet small enough to maintain an exclusive atmosphere.
On-site parking validation for up to 1.5 hours addresses a common logistical challenge in the neighbourhood, particularly for members commuting from other parts of the east end.
Structured Entry Through VIMABASE
A notable operational element is the club’s VIMABASE system, a structured onboarding process designed to support member progression. Every new member undergoes an initial fitness assessment, including those enrolled in the gym-focused membership tier.
The club also incorporates accountability check-ins, signalling a concierge-style approach that extends beyond simple access to equipment. This framework aligns with a broader industry shift toward data-informed wellness and retention strategies.
By formalizing the entry process, VIMALIFE aims to reduce churn and reinforce consistency, a key factor in long-term member engagement.
VIMAFIT Leslieville in Toronto. Photo: VIMAFIT
Tiered Membership Strategy
VIMALIFE offers two primary membership tiers. The Foundation membership provides unlimited access to the strength and cardio floor, along with a fitness assessment and one personal training session. The Summit membership builds on this foundation by adding unlimited access to all studio classes, priority booking privileges, and guest passes.
The club has also introduced a limited Founder offering to recognize early members. As it enters its first full season of growth, a small number of Founder memberships remain available, designed to reward long-term commitment.
Operating hours extend from early morning to evening throughout the week, with weekday hours from 5:30 a.m. to 9:00 p.m. Monday through Thursday, 5:30 a.m. to 8:00 p.m. on Friday, and 8:00 a.m. to 6:00 p.m. on weekends.
Reflecting Broader Fitness Industry Trends
The launch of VIMALIFE Leslieville comes amid continued evolution within Canada’s fitness sector. While budget chains maintain scale-driven models, a parallel segment of premium clubs is focusing on curated environments, community integration, and hospitality-driven service.
In urban neighbourhoods such as Leslieville, where retail and residential density intersect, this model can resonate strongly. Consumers are increasingly willing to invest in spaces that deliver both performance and belonging, particularly when those spaces reflect local identity.
By positioning itself as a membership-based club rooted in design, accountability, and neighbourhood connection, VIMALIFE is seeking to capture that demand.
New luxury wing at Toronto's Yorkdale Shopping Centre. Photo: Craig Patterson
By Antony Karabus
The retail and fashion apparel landscape has undergone significant changes in the past decade, with the traditional department store retailers seeing their dominance erode, losing market share rapidly to the fast fashion, off-price, and mass value sectors. Within the fashion apparel and luxury goods segment, mono-branded stores are stealing significant market share from department stores.
At the same time, changing consumer preferences have reshaped the entire market as a bifurcation of spending segments has created a concentration of expenditures within a smaller portion of the population. Twenty years ago, the top 20 percent of Canadians earned approximately 56% of all the income from wealth ( dividends, capital gains and interest). Now the top 20 percent of Canadians earned more than 67% of all income from wealth, showing that the income gap has become more pronounced over time ( the rich are clearly getting richer while the poor are struggling to make ends meet and are spending on basic needs for the most part).
According to a recent report from Statistics Canada from 2024, the top 20% of earners in Canada (those earning more than $ 250,000) are responsible for approximately 50% of all consumer spending. Some analysts believe that percentage to be even higher. That massive change in apparent spending, of course, leads to corresponding changes in how and where those consumers shop.
This seismic shift marks a historic high in consumption concentration. The top-tier spending group drives major economic activity, including other sectors such as leisure travel and hospitality. Their spending has rapidly increased, while lower-income households face debt pressures, indexing their spending more towards essential items. They are also directing a significant percentage of their discretionary spending towards where they see extreme value. The top 20% of Canada’s household comprise 67% of Canada’s net worth ( average net worth of $ 3.4 million), while the bottom 40% comprise only 2.8% of Canada’s net worth ( average net worth of $ 70,000).
In this report, we will examine the changes in the department store segment, the growth of fashion apparel, and the trends impacting luxury retail.
Dollarama at Adelaide and Peter Street in Downtown Toronto (Image: Dustin Fuhs)
Where are the Department Stores?
A lot has changed in the retail landscape over the past decade. In 2015, traditional department stores such as Sears Canada and Hudson’s Bay were still top-tier players, whereas by 2024, the department store category had largely been redefined by mass and junior department store discount giants (Walmart, Costco and Giant Tiger) and high-end players such as Holt Renfrew, Harry Rosen and the mono-brand luxury retailers.
The Power of Convenience and Experience
Walmart and Costco’s massive revenue gap over traditional stores highlights how “one-stop-shop” mass value retailers have effectively replaced the traditional mall department store for most households. In addition, department stores have lost their “merchandising magic.”
Discerning shoppers who are loyal to luxury brand Brunello Cucinelli, for example, are much more likely to forgo wading through a traditional department store in favour of experiencing the mono-brand designer’s own stores. When a discerning luxury shopper visits a luxury mono-brand’s own store, they also experience shopping at a dedicated luxury brand store (boutique) as it offers a superior, immersive experience, providing exclusive access to the full collection, highly trained staff, and intimate brand storytelling.
Customers also benefit from personalized one-to-one service, superior after-sales care, and a controlled, luxurious environment that creates a stronger emotional connection and prestige compared to the broader, often less specialized, selection at a department store.
Global Shifts in Fashion Apparel
The global apparel landscape has also undergone a seismic shift over the last decade. While the 2015 market was dominated by traditional athletic and casual brands, the 2025 market is defined by a massive surge in luxury mono-brand stores and the dominance of discount/value and fast fashion segments.
The total global apparel market has also seen significant growth despite the 2020 pandemic disruption. In 2015, analysts estimated total apparel sales were $1.3 trillion, which jumped to $1.84 trillion in 2025 — a stunning 41.5% increase. Driving those sales is the luxury apparel segment, along with the global growth of fast fashion brands such as H&M and Inditex.
Dior Yorkdale, September 2025. Photo: JM
Comparative Analysis: What is Driving Change?
The Rise of Uber-Luxury: In 2015, luxury was a niche segment. By 2025, LVMH and Dior reached the top of the revenue charts via double-digit growth rates even as they experienced slumps during the pandemic. Between 2015 and 2025, LVMH doubled its annual revenue. Richemont and Kering also saw similar growth. This is primarily driven by “premiumization,” where wealthy consumers spend more on status symbols, with the middle class occasionally trading up for accessories.
The Death of the Malls: In 2015 enclosed mall staples, such as Gap and Victoria’s Secret, dominated sales. By 2025, this dominance was largely replaced by the discounters and the mono-brand luxury brands.
Consumers are increasingly lured to off-price retailers because they are more value-conscious today and seek bargain prices on well-known fashion brands. This move from full-price department stores toward “treasure hunt” discount models has transformed the retail landscape — and continues to do so. Just look at the ongoing success and popularity of Wal-Mart, Costco and the discounters such as the TJX companies.
Sportswear Maturity: Nike and Adidas remain powerhouses, but their growth has slowed compared to the explosive luxury sector. Nike’s revenue nearly doubled in the decade, but it dropped from the top as luxury conglomerates consolidated their power.
Digital Native Disruption: A decade ago, the “Fast Fashion” crown belonged solely to Zara and H&M, who relied on physical stores. Today, Shein’s ultra-fast, data-driven, online-only model has allowed it to rival traditional giants in just a few years. Shein’s annual sales are about $38 billion. And then there’s the elephant in the room: Amazon.
The Online Apparel Giant
In 2015, Amazon was just beginning its aggressive push into the fashion apparel world. Today, it has transformed from a “basics” destination into the largest apparel retailer in the U.S., surpassing the legacy giants. Apparel sales have grown from $16.3 billion in 2015 to about $67 billion today — making it the number one apparel retailer in the U.S. with an estimated 13 percent market share.** It is estimated that Walmart’s apparel sales are about $30 billion.
The shift from 2015 to today represents more than just a numbers jump; it also reflects a total change in strategy from basics to brands. Ten years ago, consumers primarily used Amazon for socks, t-shirts, and commodity clothing. Today, Amazon hosts “Luxury Stores” with high-end designers and major brands such as Adidas, Levi’s, and Coach.
In 2016, Amazon launched dozens of its own brands (like Amazon Essentials and The Drop), which now consistently rank among the platform’s top sellers. There’s also the appealing “Try Before You Buy” factor. The introduction of this new Prime service (formerly Prime Wardrobe) essentially mitigated the “fit issue” that historically held back online clothing sales.
[Go deeper, check out Amazon’s luxury offering HERE.]
Global Luxury Market Value
In 2025, the luxury apparel market reached a pivotal state of “post-pandemic normalization.” While total revenue continues to climb, the industry is shifting from the explosive growth of the early 2020s toward a more fragmented landscape defined by “quiet luxury,” archival storytelling, and a stark divide between top-tier conglomerates and mid-market players.
The luxury clothing and apparel market is valued at approximately $275 billion in 2025, contributing to a broader personal luxury goods market (including accessories and watches) of over $464 billion.
Within luxury apparel, the women’s segment is identified as the leading consumer of luxury fashion due to higher spending on clothing, accessories, and cosmetics. Women’s luxury clothing represents roughly 60% to 65% of the apparel-specific market, driven by diverse product offerings. When considering all luxury goods (including bags, shoes, accessories, etc.), women’s products generally command over 50% of the market share.
Other changes impacting the luxury segment include the rise of the Generation Z shopper. In the U.S., this demographic cohort holds about $360 billion in disposable income. Gen Z accounts for about 20% of global personal luxury goods spending, and the generation is projected to drive 40% of all fashion spending by 2030 to 2035. Then there’s the resale boom. The second-hand luxury market is valued at $41.6 billion in 2025. Nearly 60% of U.S. and European consumers now use resale platforms such as Vestiaire Collective or The RealReal to source archival or “investment” pieces.
The Road Ahead
So, where does the retail market go from here? I expect the bifurcation only to grow wider due to several factors, but particularly as jobs are starting to disappear. In 2025, the Canadian unemployment rate increased to 6.6% from 6.3% in 2024. I expect that this rate will continue to increase due to a combination of AI implementations and company layoffs due to the continued uncertainty caused by the tariff wars with the US.
And it is having an impact. LVMH Moët Hennessy Louis Vuitton reported full-year 2025 results on Jan. 27, showing a slight decline in annual revenue as the luxury giant navigated a volatile economic environment. However, it saw a minor recovery in the second half of the year.
Despite these small hiccups, long-term, the luxury market is poised to continue on a strong growth trajectory. Analysts at Fortune Business Insights see the luxury sector experiencing a robust CAGR of 5.74% through 2032, with fashion apparel leading the way. The golden age of luxury apparel continues.
***
Sources: Statistics Canada,Statista Global Consumer Market Outlook, FashionUnited Top 200, Brand Finance Apparel 50 (2025), Statista Global Consumer Market Outlook (Apparel), the FashionUnited Top 200 Index, Fortune Business Insights, UniformMarket Industry Statistics (2025), Company Annual Reports (Form 10-K).
**Note: Amazon does not officially break out apparel as a specific line item in its quarterly earnings reports. These figures are based on consistent annual analysis and Gross Merchandise Volume (GMV) estimates from firms like Wells Fargo and Cowen & Co.
