Vancouver-based Lululemon will open free-standing men’s stores by 2016. The Financial Post reports that Lululemon CEO Christine Day (who will be leaving the company) made the announcement at the William Blair & Co. Growth Stock Conference in Chicago.
For those unfamiliar, Lululemon is a yoga-inspired athletic apparel company founded in 1998. It has over 200 stores in Canada, the US, Australia and New Zealand.
(The above image was a 2008 April Fools joke from Lululemon)
First quarter earnings results have been released for Canada’s Hudson’s Bay Company, and they appear positive. In the first quarter, Canadian operations saw a sales increase of 7.6% over last year.
Specific earnings numbers are provided in this Financial Post article. Instead of going into detailed numbers, we’ll start delving into Hudson’s Bay‘s strategy and some potential shortcomings.
Hudson’s Bay’s modernization strategy has included selected store renovations and the introduction of TopShop/TopMan concessions at several of its stores. Top Shop’s moderate prices and youthful designs have seen Canadian earnings in excess of $500 per square foot according to a source at Hudson’s Bay. Other new designer brands and the introduction of the ‘White Space’ contemporary/bridge women’s departments in selected Bay stores have also increased per-square-foot store revenues. As increased concentration on women’s shoes has seen some new moderate-to-upscale brands added, including Friday’s opening of a 50,000 square foot women’s shoe hall at the chain’s Toronto flagship store.
Despite the apparent success of its modernization strategy, Hudson’s Bay has continued to fall short in one of retail’s greatest sales drivers – women’s handbags. Despite having relatively large handbag departments at its flagship stores, Hudson’s Bay lacks many of the upscale handbag labels and concessions found internationally at similar successful department stores. Hudson’s Bay has introduced Coach shops at selected locations and a Burberry shop at its Toronto flagship. As a whole, though, Hudson’s Bay lacks exciting handbag concessions like those found at House of Fraser in Britain, Karstadt‘s flagships in Germany and El Corte Inglés in Spain, for example.
Next week we’ll have a look at how handbags create excitement at these and other European department stores, and how Hudson’s Bay could benefit. We’ll also look at how Bloomingdale’s has built substantial sales in their handbag departments through various designer shops-in-store at selected locations. Despite Hudson’s Bay’s rosy revenue report, it could make substantially more money by selling more upscale and unique handbags, while elevating the image of its stores as well.
Lastly, we’ll examine the touchy subject of Hudson’s Bay’s customer service. We’ve questioned readers and the public in several Canadian communities, asking for their perceptions on Hudson’s Bay’s customer service. Given the feedback that we received, Nordstrom’s Canadian arrival should be of considerable concern to Hudson’s Bay.
Be sure to check back to read our analysis of how handbags could save Hudson’s Bay.
Grocer Canada Safeway has been bought by Sobeys in a cash deal worth $5.8 billion. Savings of about $200 million yearly are expected with the combined store sales forecasted to be $24 billion annually.
Sobeys has about 1,300 owned and franchised Canadian locations under banners including Foodland, FreshCo, IGA and Sobeys.
Canada Safeway assets include:
Competition for food store retail in Canada has grown with the arrival of Target and Walmart‘s increased concentration on grocery products. Whole Foods will also be expanding its Canadian operations while competitor Loblaws, with over $30 billion in sales, is still the market leader.
North America’s first Christian Louboutin ‘apartment’ will open at Holt Renfrew, Yorkdale Shopping Centre this fall. It will open within Holts’ new 10,000 square foot women’s shoe floor.
The Louboutin ‘apartment’ will be modelled on Louboutin’s actual Paris residence. Selfridge’s in London also has a Louboutin ‘apartment’ modelled in the same way. The 600 square foot London shop has an eclectic design that includes family portraits of Louboutin as well as artifacts collected from his extensive travels, from Mexican dolls to stone doorways to an antique door made of mussels and sea shells. The carpet, as can be expected, will be red.
For those unfamiliar, Holt Renfrew is owned by Selfridge’s Group.
Yorkdale’s Holt Renfrew is being used as a prototype for future Holt Renfrew store renovations/expansions. Holts will substantially expand its women’s shoe offerings coast-to-coast. This week we will discuss Holt’s footwear strategy in light of the arrival of Nordstrom and the recently opened 50,000 square foot shoe hall at Toronto’s flagship Hudson’s Bay.
On Friday, June 21st from 4pm-6pm, Christian Louboutin will make a personal appearance at Holt Renfrew, 50 Bloor Street West in Toronto. Everyone is welcome.
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Whole Foods‘ American parent is testing lower-priced stores in an effort to expand its customer base. If successful, the concept could come to Canada as part of its intended 40-store Canadian rollout in the coming years. The new American stores will be located in lower-income neighbourhoods. The first test store opened Wednesday June 5th in Detroit and two more will open this year in New Orleans and on Chicago’s South Side.
The stores will differ from regular Whole Foods stores in the following ways:
The goal is to bring healthy food to lower-income shoppers who might not otherwise be able to shop in regular Whole Foods stores. Whole Foods has fought a reputation of being ‘too expensive’ and, to its chagrin, some have nicknamed it ‘Whole Paycheque’.
The retailer’s American stores earn a gross margin of between 34% and 36%, compared to Walmart and Target‘s 24%-29%. Lowering prices and quality could still positively affect Whole Foods’ bottom line.
Whole Foods may have to be concerned about their brand perception, however, if it chooses to roll-out its lower-cost stores globally. The store’s current high-quality, higher-priced status could be compromised if the concept isn’t handled properly by company management.
Whole Foods currently has 9 Canadian stores and expects to open 40 more locations in the coming years, according to the Financial Post. The company intends on eventually having Canadian sales of about $1 billion. It has about 350 American stores with about $12 billion in sales. It has said it wants as many as 1,000 locations eventually, according to its CEO John Mackey.
Hudson’s Bay has opened a 50,000 square foot women’s shoe department on the ground-floor of its flagship “Queen Street” store in Toronto. From our research, it appears to be the fourth largest shoe floor in the world. The vast space is located in the entire western-portion of the flagship’s ground floor which formerly housed men’s furnishings.
Today was the shoe floor’s ‘soft opening’. More is still to come for the shoe space, possibly including a rumoured Jimmy Choo boutique.
The new salon includes a luxury department called ‘The Room’ shoes, which carries such luxury brands as Christian Louboutin, Brian Atwood, Balmain, Nicholas Kirkwood, Azzedine Alaïa, Charlotte Olympia, Gianvito Rossi, Martin Margiela, Sonia Rykiel, Pierre Hardy and others. This shoe department was moved downstairs from its original location within the store’s luxury salon ‘The Room’ located on the third floor.
A considerable amount of shoe floor’s square footage is dedicated to storage and back-room activity. The space was designed by Toronto-based Yabu Pushelberg, which has been designing some of Hudson’s Bay’s interior renovations since 2009.
The world’s largest shoe store is in Dubai, with about 96,000 square feet. The largest department-store based shoe floor is supposedly at Macy’s in Manhattan at 63,000 square feet with 39,000 square feet of selling space and 24,000 square feet of back rooms/storage. Galeries Lafayette in Paris claims to have a 64,560 square foot shoe floor with 34,500 square feet of retail space. Selfridge’s in London claims to have 35,000 square feet of retail space and we haven’t located the size including storage. Regardless, Hudson’s Bay’s new Queen Street shoe floor is massive.
Thank you Samson Yuen for his photos posted in this article. If readers have photos of this or other Canadian retail openings, please email them to us and we’ll credit you: insider@retail-insider.com
We’re waiting to hear back from Hudson’s Bay for more updates. We’ll report as we get more details. Have an excellent weekend, and thank you for reading Retail Insider.
Today (Friday, June 7th) Toronto’s Drake General Store will open a pop-up shop at Toronto’s flagship Hudson’s Bay Queen Street store. It will be located on the lower-level of the department store, accessible to Toronto’s underground PATH system.
Drake General store has three Toronto locations and is known for its unique products and novel interiors. The store’s website provides a more in-depth description of its concept and wares. According to their website, the store re-imagines the “traditional hotel gift shop” with a contemporary and urban context. It is varied, combining elements from the “classical general store, the museum shop and the flea market stand”. Both local and international products are available.
Store interiors include reclaimed wood cabinetry, recycled hanging fixtures and mid-century modernist wood furniture. The store uses a neon purple cross as its ‘beacon’, modeled after those used by European pharmacies.
The first Drake General Store opened in 2008 on Toronto’s Queen Street West. The Drake General Store has three permanent Toronto stores including 1144 Queen Street West (neighboring the Drake Hotel), 2607 Yonge Street (between Eglinton and Lawrence Avenues) and 82A Bathurst Street (Bathurst and King Street).
Pop-up shops are a potentially beneficial way for retailers to enrich the in-store experience. In an age where online shopping has become common, building a unique in-store experience will be vital. We commend Hudson’s Bay’s inclusion of a pop-up shop and we encourage the company to consider other similar innovations to attract customers.
Source: Skeezix of Urban Toronto, who directed us to this blog post describing the new store.
North America’s first Hermès fragrance shop has opened at Holt Renfrew, Yorkdale Shopping Centre in Toronto. The shop carries the entire collection of Hermès fragrances for both men and women. It is located within the new 10,000 square foot beauty hall at Holts Yorkdale, which held its grand opening yesterday (Thursday, June 6th).
The Yorkdale Holt Renfrew beauty hall includes four treatment rooms and a host of other ‘shops’ for brands Aesop, Bobbi Brown, Chanel, Jo Malone, Kiehl’s, La Mer and La Prairie. Also included is the new ‘Primp and Polish Bar’ where shoppers can get their eyebrows, nails and lashes done, as well as hair blowouts.
According to an insider at Holt Renfrew, the new cosmetics floor concept will also be rolled out in other Holt Renfrew stores over the next two years, modelled on the Yorkdale store. Holt Renfrew is in the process of a series of massive store overhauls that will see expanded and renovated stores as well as a new focus on menswear via their own ‘men’s stores’.Â
Holt Renfrew’s Yorkdale store has been undergoing a transformation and massive expansion that will see it include the chain’s largest shoe floor (at 10,000 square feet) as well as several new men’s shops (including Paul Smith and Dolce & Gabbana) and women’s shops that will include Chanel, among others. Our most recent update of Holt Renfrew’s Yorkdale expansion can be found here.
Holt Renfrew is using its Yorkdale store as a prototype of sorts, testing a more expansive shop-in-store configuration not found in many Holt Renfrew stores. We’ve been told that, so far, positive customer feedback resulting from its hardshop vendors will result in a rollout of similar shops and concepts at Holt Renfrew stores nationwide.
We’ll keep you updated on further openings within Holt Renfrew’s Yorkdale store, as there will be several more this summer and into the fall.
Supermodel Bar Refaeli will be the new face of Sears Canada‘s label, Nevada. She will also be featured on the cover of Sears’ fall 2013 publication called ‘LOOK!‘
Sears Canada’s CEO, Calvin McDonald says: “With the launch of our new Nevada brand denim designed by the Buffalo Group, we wanted someone that matched what the brand represents for women: fashionability, quality, and confidence. We believe this relationship will demonstrate to Canadians that Sears is a destination for great fitting, affordable and fashionable apparel, especially in the 25 to 40 age demographic.”
Refaeli recently completed the photo shoot for the Fall LOOK! report where she will appear on the cover. She will also be involved in a number of marketing and public relations activities as the face of Nevada. In-store appearances in conjunction with the launch of the Fall LOOK! report are being planned, as is the release of a behind-the-scenes video featuring clips from the photo shoot for the LOOK!
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