Retail Insider is streamlining its Canadian retail news from around the web to include a handful of top news stories that can be viewed quickly during the day. Here are the top stories from the past 24 hours.
Canadian grocery retailer Loblaw reported that a recent consumer boycott had only a minor impact on its sales, with a significant decline in profits attributed mainly to a lawsuit settlement.
The boycott, which emerged due to alleged price gouging during the pandemic, aimed to pressure the retailer into fairer pricing practices. Despite the effort, Loblaw’s latest financial results indicate that the boycott did not substantially affect overall sales figures.
The primary financial setback for Loblaw this quarter was a substantial settlement related to a longstanding bread price-fixing lawsuit. This legal issue, dating back several years, culminated in a financial agreement that significantly impacted the company’s profitability. The settlement highlights the ongoing challenges Loblaw faces in overcoming past controversies and restoring its reputation among Canadian consumers.
Despite the profit decline, Loblaw’s grocery and pharmacy divisions, including Shoppers Drug Mart, showed resilient sales. These sectors have provided stability amidst the company’s legal and public relations challenges, reflecting strong consumer demand and effective business strategies. The steady performance of these divisions underscores Loblaw’s ability to maintain its market position even under adverse conditions.
The minor impact of the boycott suggests that while Canadian consumers are vocal about pricing concerns, sustained boycotts may be less common. This insight is valuable for retailers aiming to understand consumer behaviour and adjust their pricing strategies accordingly. For Loblaw, this period represents an opportunity to rebuild trust through transparent practices and responsive customer service.
Loblaw’s future strategies are likely to focus on reinforcing its competitive edge while addressing consumer dissatisfaction and legal vulnerabilities. Investments in fair pricing, customer loyalty programs, and enhanced service offerings will be crucial for long-term stability and growth. As the company works to recover from its recent setbacks, its actions will be closely monitored by industry analysts and competitors.
Loblaw Companies Ltd. and its parent company, George Weston Ltd. have agreed to a $500 million settlement to resolve a class-action lawsuit accusing them of participating in a 14-year bread price-fixing scheme. This case, which implicates other major retailers like Metro, Walmart Canada, Giant Tiger, and Sobeys, represents the largest antitrust settlement in Canadian history. The lawsuit alleges that these companies conspired to artificially inflate bread prices from 2001 to 2015, significantly impacting Canadian consumers.
George Weston will contribute $247.5 million in cash, while Loblaw will pay $252.5 million, which includes $156.5 million in cash and $96 million in credits previously issued to customers through the Loblaw Card program. Galen Weston, CEO of both companies, publicly apologized, emphasizing the need for ethical business practices and the importance of maintaining consumer trust.
The settlement follows extensive investigations by the Competition Bureau, which began probing the alleged price-fixing activities in 2016. Weston Foods and Loblaw previously admitted to their involvement and received immunity in exchange for their cooperation. The Competition Bureau claimed that the conspiracy added at least $1.50 to the price of a loaf of bread, impacting Canadian households over the years.
This historic settlement underscores the critical need for transparency and ethical practices within the Canadian retail industry. It sets a precedent for how anti-competitive behavior will be handled, potentially leading to stricter regulatory oversight and more rigorous compliance standards across the sector. For Canadian retailers, the case serves as a stark reminder of the importance of adhering to ethical standards and maintaining the trust of their customers.
The broader impact on the industry could be profound, prompting retailers to re-evaluate their business practices and foster a more competitive environment. This settlement might also influence consumer perception, leading to heightened demand for fair pricing and corporate accountability. Moreover, as Loblaw and George Weston work to rebuild their reputations, they may introduce new measures to ensure compliance and ethical conduct. This could include enhanced training programs, stricter internal audits, and greater transparency in pricing policies. The ultimate goal will be to restore consumer confidence and demonstrate a commitment to ethical business operations moving forward.
Walmart Canada announced a $53 million investment to increase wages for approximately 40,000 hourly store associates while also making investments in technology. This initiative aims to boost employee compensation, attract talent in competitive markets, and acknowledge the hard work of its associates.
AnnMarie Mercer, Walmart Canada’s Chief People Officer, highlighted the company’s dedication to its employees, stating, “We are committed to investing in our people and making Walmart Canada a great place to work.” This pay raise represents Walmart’s effort to recognize the critical role of store associates in the company’s success and ongoing growth.
In addition to wage increases, Walmart Canada is investing in advanced technology to further modernize its operations. The introduction of new digital handheld devices for employees is expected to improve customer service and operational efficiency. Joe Schrauder, Chief Operating Officer at Walmart Canada, emphasized the importance of this technological upgrade, saying, “Providing our associates with the right tools is essential to meeting the evolving needs of our customers.”
These digital devices will enable employees to access real-time information, manage inventory more effectively, and streamline various in-store processes. By enhancing the technological infrastructure, Walmart Canada aims to create a more seamless and efficient shopping experience for its customers.
Walmart Canada’s comprehensive strategy includes not only competitive wages but also a range of benefits and development opportunities for its employees. The company offers incentive bonuses, health benefits, and career advancement programs, including full tuition coverage through its Live Better U program. These initiatives are designed to support the professional and personal growth of Walmart associates.
Mercer reiterated the company’s focus on employee development, adding, “Our associates are the heart of our business, and we are dedicated to providing them with opportunities to grow and succeed.” This holistic approach to employee welfare underscores Walmart Canada’s commitment to being a top employer in the retail sector.
With over 400 stores nationwide and a robust online presence, Walmart Canada continues to be a dominant player in the Canadian retail market. The company’s efforts to invest in its workforce and embrace new technologies reflect a broader strategy to maintain its leadership position in the industry. The company has announced in recent years billions of dollars of investments in the Canadian market, including updating and expanding physical stores, its online business, as well as its expansive logistical operations.
Anatomy of a Leader: Wendy Derzal Minnett, VP of TacoTime Canada and Extreme Pita Canada
A passion for the hospitality industry has always been an important part of Wendy Derzai Minnett’s life.
The VP of TacoTime Canada and Extreme Pita Canada with the MTY Food Group can trace her career in the hospitality industry back several years ago when she had a burning desire to see Bruce Springsteen in concert in Toronto.
Wendy was born in Montreal but her formative years were spent in Geneva, Switzerland as her father had diplomatic status working with the International Telecommunications Union. The family lived there for most of her younger years.
The family came back to Canada by the time she was in Grade 8 to Manotick, Ontario, just outside of Ottawa.
“I had to learn to read and write in English,” says Wendy.
Earlier years in hospitality – photo supplied
She initially took Arts at Carleton University and then went to the University of Toronto to do a degree in environmental science.
“That’s sort of where my career started. I worked at Skydome actually when I got hired by Manpower when they were just building because I really wanted to see Bruce Springsteen and obviously had no money to do that,” says Wendy.
“A friend of mine was getting a job as an usher and I thought ‘Oh my God that’s a great idea, I’m going to do that too’. So I got a job as an usher and of course I never got to see the show because I was too busy working. So that really didn’t work out very well but it started a great path for me.
“I was an usher. I was there eight years and I got promoted all the way through. I was in guest services, I got promoted to the head of guest services, I was the EA for one of the VP’s at Skydome and then ended up running the corporate suites. And in doing that, I met all the predominant Torontonians who worked in financial and big companies which led me to start my own event marketing company. And it was easy. I was lucky because I made so many great contacts.”
Prior to joining MTY, Wendy was with Gateway Casinos and Entertainment Limited as Director of Brand Marketing and Director of Food and Beverage Marketing.
Her professional career also included positions as Director of Marketing, Sales and Business Development with the Donnelly Group and Director of Marketing and Sales with Points West Hospitality Group.
Wendy also has a Diplome de cuisine from Le Cordon Bleu in Paris, France.
Taco Time trade show event, photo supplied
She spent five years in the casino industry prior to joining MTY.
“It was an exciting five-year venture in the casino business. I was able to build and develop four unique casino brands and four unique food and beverage brands that we sort of replicated in each of the casinos. It was really fun because it was a highly competitive and dynamic environment. It demanded a lot of creativity and innovation and each brand needs to stand alone in a market saturated with entertainment options,” explains Wendy.
“It really actually helped me hone in on my marketing skills, customer service, customer experience, attracting patrons. It really enforced the need for loyalty and that’s a huge thing in casinos but it really translated well into what I do now because it’s all about loyalty. Back then you didn’t have loyalty programs, it was really important to define that brand differentiation, customer loyalty program, high stakes project management. They were all crucial and critical things to learn before I got into QSR (quick service restaurant).”
When she first went to university, Wendy says she wanted to be an environmental lawyer.
“But that didn’t work out very well because the only problem with that is . . . at that time, it was 1992, certainly environmental science and the love of the environment is not where it is today, so back then I would have to be on the side of government and if I was going to be on the side of government versus the people that are polluting I wouldn’t have made any money and I would have starved to death, so that wasn’t going to be a good plan for me,” she laughs.
Working at Skydome led her into another field.
“My mom always said that you’ll fall into something that you love and it just became something that I loved. I loved hospitality. I loved cooking. I have the personality I guess as I’m always good with sales, so sales and marketing kind of came together and the great part of this part of my life is once I left Gateway and Mr. Dave Minnett (CEO of Edo Japan and now her spouse) sort of determined that it was a good idea for me to come to Calgary, doing that here brought the culmination of all that QSR experience,” says Wendy.
“I really love the whole idea of building a brand identity. Customer experience is paramount for me for anything that I’ve ever done. This has all kind of enabled me to innovate continuously, ensuring our QSR brands are not just met but exceeded by customer expectations in today’s competitive market.
“What I love about this job is that it’s sort of a culmination of everything that I’ve ever done and it’s brought into one place. And I feel all the experience I’ve had led me to where I am today. It’s been a 30-year journey.”
Image: Wendy Derzal Minnett
Wendy says she’s worked with great people and some not-so great people in her career.
“I sort of promised myself if I was ever put in a position of having people, leading a team, I would make it inclusive, non-dictatorial. I always say to my team this is not a dictatorship. Your opinion matters. We have to make these decisions together,” she says.
“I’m a very empathetic person. I like people to enjoy what they do. It’s a hard job. We have to do it every day. I want them to come and have a good time, enjoy themselves, and still enjoy their job with support. I believe every person has great abilities to do their job but I think you can do your job a lot better when you’re actually given a pat on the back and told what a great job you’re doing. I really wanted to build loyalty in my team.
“We are a team. I’ve always said the only time that I am the boss is when stuff’s rolling down the hill and then I’m there to protect you from it. That’s my role. Otherwise we do everything together. We collaborate. We do it together. I learned all the things not to do from previous people . . . I really wanted to be a mentor and I’ve had some great people in my career who have actually helped me get to that next level. So I wanted to do that for every member of my team.”
Wendy enjoys golfing in her spare time as well as traveling and culinary experiences.
“Calgary has just been a joy I have to tell you. Going from Vancouver to Calgary I was really concerned. I had a great space in Vancouver. 180 degree view with the mountains and the ocean. But honestly in Calgary the hospitality gene in this city is by far the best I’ve experienced in any city I’ve ever lived in,” she says.
“Our level of culinary expertise and cocktail culture here for a city of its size is staggering to me. There’s always something new and amazing to experience. It’s really been a joy.”
Craig and Dustin Fuhs, Editor-in-Chief at Retail Insider, discuss nearly four years of retail industry evolution during Fuhs’ tenure with the publication. They reflect on the significant impacts of the COVID-19 pandemic, which brought about numerous challenges such as lockdowns, bankruptcies, and rapid adaptations within the retail sector. Fuhs shares insights into how Retail Insider managed to navigate through these turbulent times by staying flexible and responsive to the changing needs of their readership.
Throughout the conversation, Fuhs highlights several memorable stories and milestones, including the closures of major retailers including the Disney Store, Nordstrom, and Target. He recounts the secretive and strategic nature of their work, from holding exclusive news about IKEA’s downtown Toronto store to the expansion of Indochino under Drew Green’s direction. The discussion also covers the rise of experiential retail, with examples like Tesla and Apple stores, and Fuhs’ passion for immersive retail experiences.
As Fuhs prepares to step down from his role, he reveals his future plans, including the launch of his new venture, The Immersive Lab, which focuses on creating unique retail and experiential environments. He expresses his gratitude for the relationships and experiences gained during his time at Retail Insider and looks forward to continuing to contribute to the industry in new ways. Patterson and Fuhs conclude by emphasizing their ongoing commitment to staying connected and discussing the ever-evolving landscape of retail.
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Retail Insider is streamlining its Canadian retail news from around the web to include a handful of top news stories that can be viewed quickly during the day. Here are the top stories from the past 24 hours.
Nordstrom Closing at CF Toronto Eaton Centre (June 2023) Image: Dustin Fuhs
A recent survey reveals that despite moderate brand familiarity, American retail giant Nordstrom struggled with low visit frequency in the Canadian market, ultimately leading to its exit due to insufficient consumer engagement.
“Following the closure, 67 per cent of former customers turned to other retailers like Hudson’s Bay and La Maison Simons (among others), while 53 per cent expressed disappointment as those consumers had valued the retailer’s selection of clothing, quality products, and overall shopping experience,” said Luc Dumont, Senior Vice-President with Leger.
“This significant emotional impact and the diverse preferences for replacement retailers highlight substantial opportunities for other brands to capture the displaced customer base.”
Vacated Nordstrom at CF Rideau Centre (Image: Dustin Fuhs)Closed Nordstrom Canada at CF Toronto Eaton Centre (Image: Dustin Fuhs)
Dumont said the survey didn’t reveal anything super surprising.
“We did see that Nordstrom was recognized by many Canadians. Kind of a moderate awareness level. But as we all saw from its performance, they kind of struggled to turn this recognition into actual floor visits,” he said.
“Even before their departure from the Canadian market we could see that. They were struggling to convert that awareness into shop visits and sales.”
Based on his assessment of the brand’s marketing efforts, or lack thereof, Dumont said he felt that Nordstrom never really knew how to connect with the Canadian consumer which is completely different than the American consumer.
“I don’t have any examples of what that means but I think a lot of people were aligned with that thinking when they were here,” he said.
“Canadian consumers are very unique. Following the closures most shoppers say they adapted by turning to or going back to other retailers like The Bay and Simons, which I feel offer similar experiences in terms of their brand mix and their overall in-store experience.
“But it’s also notable to see that quite a few did not have or say they did not find a suitable replacement. That might highlight a bit of an opportunity for other retailers to fill that gap.”
Shuttered Nordstrom at CF Pacific Centre (Image: Lee Rivett)Nordstrom Rack Closing at 1 Bloor (Image: Dustin Fuhs)
Key highlights from the survey report include:
Nordstrom’s aided awareness is at 56 per cent, placing it in the mid-tier among the listed retailers. This indicates that while over 1⁄2 of Canadians were aware of Nordstrom, there is a significant portion that were not. Nordstrom’s awareness is higher than Saks Fifth Avenue (49 per cent) and La Maison Simons (49 per cent), but lower than The Bay (85 per cent) and lululemon (76 per cent);
While Nordstrom had a presence in Canada, it was not as deeply entrenched in consumer consciousness as some other major retailers. Nordstrom has a net familiarity of 35 per cent, which is lower than top retailers like The Bay (79 per cent) and Nike (76 per cent) but higher than Decathlon (22 per cent) and Saks (27 per cent). 66 per cent of respondents either did not know Nordstrom or had only heard of it without knowing any details, indicating a general lack of brand engagement;
Despite being familiar to many Canadians, Nordstrom faced challenges in attracting regular visitors, with 44 per cent of familiar respondents never having visited the store and 38 per cent visiting only rarely. This lack of frequent foot traffic, particularly among older age groups and lower-income households, suggests a disconnect between Nordstrom’s offerings and the needs of these demographics. The limited engagement likely contributed to Nordstrom’s decision to exit the Canadian market, highlighting the importance of converting brand awareness into actual store visits;
Following Nordstrom’s exit from the Canadian market, 67 per cent of its former shoppers have replaced it with other retailers, with The Bay being the top choice at 20 per cent, followed by Simons (11 per cent) and Winners (seven per cent). However, 26 per cent of respondents did not find a replacement. The variety of replacement choices, including specialty and second-hand stores, underscores the diverse preferences of Nordstrom’s former clientele, highlighting both the adaptability of consumers and potential market opportunities for retailers to capture this displaced customer base;
Nordstrom’s departure from Canada deeply affected its customers, with 53 per cent expressing disappointment. Their sentiments were primarily driven by the store’s valued clothing and brand selection, their fondness for shopping there, and its reputation as an excellent department store. The high net disappointment rate underscores the brand’s meaningful presence and the gap it leaves in the Canadian retail landscape. Customers also cited good merchandise, a unique product line, and good prices as key reasons for their disappointment of Nordstrom closing. This indicates opportunities for other retailers to capture this displaced customer base by emulating Nordstrom’s valued attributes and addressing the broader economic and community concerns stemming from its closure.
Updated glass galleria at CF Toronto Eaton Centre. Photo: Dustin Fuhs
Canadians’ spending intentions are improving sequentially and showing signs of life, according to a new survey by Stifel, an investment banking company.
Recently, the company published its quarterly survey assessing spending intentions for Canadians over the coming 12 months.
“Surprisingly, spending intentions are up sequentially in most of the categories we track and near a one-year-high. Categories such as mattresses, powersports, dollar stores, the pet industry, apparel and toys are all at or near a one-year-high,” said the report.
“While our survey suggests improvement in Canadian consumer confidence, spending intentions are still in a pattern of contraction with 52 per cent of respondents being likely or very likely to reduce their discretionary spending over the next 12 months. Despite that, these results piqued our curiosity and suggest investors should start to think about how to position their portfolio under a scenario where Canadian consumer confidence returns to an expansionary mode. Our survey results are positive for Sleep Country, Dollarama, Aritzia, Gildan, Pet Valu, KITS, BRP, and Spin Master.
“In our view, the results paint an accurate picture of the state of the Canadian consumer and historically the results have been generally a good indication of upcoming financial performance of our companies under coverage.”
Martin Landry, Managing Director, Equity Research for Stifel Canada, said the company was surprised by the increase in spending intentions that the survey suggests.
Martin Landry
“We’ve been carrying this survey for three years now. We’re doing it on a quarterly basis . . . Historically it’s been somewhat a good predictor of operational performance of our companies. So the recent results were quite upbeat,” he said.
“We saw a nice increase in spending intentions on discretionary items.”
Here’s Stifel’s take on the report:
Discretionary spending intentions rebound in July. After nine months of depressed spending intentions, the outlook appears to improve. According to our survey results, 48 per cent of respondents expect their spending on discretionary items to increase in the coming 12 months, up 400bps sequentially from April 2024. Interestingly, 14 per cent of respondents indicated they were “very likely” to increase their discretionary spending over the next 12 months, the highest proportion of the last five surveys we conducted. However, our survey would suggest we are still in a pattern of contraction as 52 per cent of respondents are likely to reduce their spending on discretionary items;
Stronger spending intentions for clothing and apparel vs. July 2023. 54 per cent of respondents to our survey expect to increase their spending on clothing and apparel in the next 12 months. While spending intentions for clothing and apparel appear stable sequentially, when compared to our July 2023 survey results, they came-in 400bps higher, which is surprising given the current economic slowdown. After nine months of spending intentions below 50 per cent, this is the second survey suggesting we are in an expansionary period for clothing and apparel. We view these demand trends as positive for Aritzia and Gildan;
Signs of demand recovery within the mattress industry continues. The demand environment for mattresses in Canada has been challenging for the past two-plus years. However, our survey results suggest that the outlook is improving with spending intentions up for two consecutive quarters, and with July 2024 showing the strongest spending intentions since March 2022. Hence, we could see a scenario for a rapid pickup in demand as the economic environment improves;
Demand trends for powersports vehicles appear resilient in Canada. Our survey results show that spending intentions for powersports vehicles appear to have rebounded sequentially and have reached their highest level since July 2022. These results align with BRP’s comments that demand weakness has been more pronounced in Asia Pacific, Europe and to some extent in the U.S., while Canada has been a bright spot. However, Canada represents roughly 15 per cent of BRP’s revenues. Hence, the impact on BRP’s overall results remains limited vs. the U.S. where BRP generates ~60 per cent of its revenues. We have seen no change in the demand environment in the U.S. as suggested by CDK Global data, which shows that recent demand trends at U.S. dealerships remain soft;
Demand intentions for the pet industry reach the highest level in a year. Following an unexpected drop in demand intentions within the pet industry in April 2024, demand trends appear to have improved sequentially with July 2024 spending intentions coming in at the highest level of the last 12 months. Compared to July 2023, demand intentions are flat, which we view as positive for Pet Valu. These trends paint a more bullish outlook for the pet industry than expected and may indicate that demand trends are better than feared;
Demand for “value” alternatives within eyewear products appear strong. On June 19th, KITS announced the official launch of its private label daily silicone hydrogel contact lenses. According to our analysis, KITS contact lenses are priced at a discount of roughly 40 per cent to national brands. According to our survey results, this should appeal to consumers as 74 per cent of respondents who buy contact lenses would consider switching to a private label brand if the price was at least 30% cheaper. While KITS’ private label contact lens business is small, we see a potential for the company to grow this segment, which should boost profitability given margins on KITS’ private label products tend to be much higher vs. margins on national brands products;
Spending intentions for the toy industry remain in positive territory. 54 per cent of respondents to our survey expect their spending on toys to increase in the next 12 months. This is a decline of 200bps sequentially from our April 2024 survey. However, 15 per cent of respondents said they are “very likely” to increase their spending on toys in the coming 12 months, the highest level in the last year. Overall, spending intentions within the toy industry have shown limited volatility over the past four surveys and have remained positive (i.e. a majority of respondents expect their spending to increase), which is a positive for Spin Master.
Landry said the results could be the start of the return of consumer confidence of Canadians which may seem a little bit counter intuitive to what we’ve been hearing lately.
“I could explain this by two things,” he added. “There’s been some healthy salary and wage increases over the last two years. Sometimes even higher than inflation and we’ve also got our first interest rate cut by the Bank of Canada. Although that’s not going to have a meaningful impact on mortgage payments yet, it’s the start of a trend towards interest rate reduction and maybe that plays out in consumer confidence and maybe that’s why we’re seeing that reflected in our survey.”
Retail Insider is streamlining its Canadian retail news from around the web to include a handful of top news stories that can be viewed quickly during the day. Here are the top stories from the past 24 hours.
