Craig and the Passen leadership team discuss their innovative digital measurement platform that is poised to revolutionize the fashion industry. Passen’s digital solution is designed to help consumers find clothing that fits both online and in-store, addressing a long-standing challenge in the retail world. Their commitment to improving shopper satisfaction, boosting online sales, and reducing the environmental impact of fashion consumption sets Passen apart as a trailblazer in this field.
The platform has undergone a remarkable transformation, evolving from the initial concept of a virtual change room in malls to a more accessible and convenient handheld mobile device. This shift allows users to scan their bodies from the comfort of their homes, providing accurate measurements that can be directly compared to specific garments. The company’s three-phase approach includes capturing measurements, comparing them to the chosen clothing items, and offering a seamless and user-friendly customer experience. With plans to integrate their technology into Shopify and collaborate with iconic retailers, Passen aims to decrease the number of returns and ultimately contribute to reducing waste and carbon footprints in the industry.
As a Canadian company, Passen takes pride in its Canadian heritage and its ability to collaborate with well-known retailers, like Harry Rosen. The calibration process with retailers is in full swing, and Passen plans to implement its technology on various Shopify sites in the near future. Their vision extends beyond simple growth; they aim to transform the fashion industry, reduce the stress and waste associated with clothing returns, and offer a personalized shopping experience that caters to individual preferences. With an experienced team and unwavering commitment, Passen is ready to make its mark and redefine the way consumers shop for clothing.
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Seasonal Halloween Candy Display at Walmart Gerard Square in Toronto (Image: Dustin Fuhs)
Halloween has been at the forefront of children’s thoughts for weeks now, but for most parents, the preparations for the big night and the purchase of candies for eager trick-or-treaters are just commencing. The average household is poised to allocate anywhere from $25 to $40 for Halloween candies. However, with the escalating cost of living and the holiday landing on a Tuesday this year, the total expenditure remains uncertain. Regardless of the final tally, it’s clear that this money won’t stretch as far as it once did.
Enter “shrinkflation,” a silent and subtle disruptor that has infiltrated the Halloween candy aisle this year, affecting the purchasing power of Halloween enthusiasts. This phenomenon often escapes notice until you unwrap the package. For instance, Reese’s, a perennial favourite, now comes in bite-sized portions that might appease toddlers but leave the rest yearning for more. The ever-popular “Rockets” have been reduced to incredibly diminutive sizes, and some Halloween M&M packages contain just two pieces. Given that Halloween is a once-a-year celebration and candies grace the shelves for only a brief period, these shrinkflation strategies are more conspicuous and startling to consumers this year.
Halloween Candy at No Frills (Image: Dustin Fuhs)
It’s customary to disregard minor reductions in product sizes as they happen gradually over time. Manufacturers frequently diminish quantities while maintaining steady prices, driven by the mounting cost of production. For instance, cocoa futures have reached a 44-year high, primarily due to production issues in Western Africa and other global regions. Consequently, major buyers have had to renegotiate contracts and pay more, impacting the cost of Halloween chocolate. It is anticipated that cocoa futures will continue to influence chocolate prices in the months ahead, solidifying shrinkflation as an ongoing concern.
Another hurdle facing Halloween candy is the surge in sugar prices, reaching their highest levels since 2011. Additionally, a labour dispute has disrupted a Vancouver-based plant owned by Lantic-Robers since September 28. Reports of shortages are already surfacing, and commercial bakers are being encouraged to curtail their purchases. If this labour dispute persists, consumers may soon find themselves asked to limit their purchases as well. Such a situation should discourage stockpiling, especially during a period of significant food inflation.
Now, when it comes to chocolate and sugar, both are considered non-essential commodities. While the impact on Halloween candy is undeniable, there’s no need for alarm. Many food businesses, bakeries, and manufacturers regularly rely on these ingredients. Price adjustments are expected in the months ahead, affecting not only Halloween but also upcoming holidays such as Thanksgiving, St. Valentine’s Day, Easter, and more.
In a peculiar turn of events, even though the costs of Halloween candy are rising, a substantial portion of people’s budgets is expected to be directed toward costumes this year, more so than in previous years. In fact, experts predict that many Canadians will increase their overall Halloween spending, with Barbie-themed costumes gaining popularity. The Barbie craze has captivated both children and adults, inspiring extravagant costumes that contribute to the uptick in Halloween expenses.
Ultimately, Halloween is all about enjoyment and indulgence, and the smaller candies may just encourage children to knock on more doors this year in pursuit of their favourite treats. While it’s essential to remain mindful of shrinking portions and rising prices, the joy of Halloween remains undiminished. After all, when it comes to candy, a little extra effort to collect it may not be such a bad thing. So, let the spooky season commence, and savour the thrill of Halloween with a grin as big as any candy bar!
Holt Renfrew Men at 100 Bloor St. W. in Toronto. Photo: Craig Patterson
Luxury multi-brand retailer Holt Renfrew is expanding its menswear offerings as competition grows in the Canadian market. The company is seeing success with some newer and edgier brands as consumer tastes continue to shift to more casual comfort. The retailer is also heavily investing in its brick-and-mortar operations as competition grows in Canada.
In Vancouver, Holt Renfrew recently hosted its Men’s Edit Event which showcased a range of fashions, accessories, and grooming with personal appearances, exclusive previews, made-to-order and made-to-measure events. A new brand launch included AGOLDE’s men’s Fall ‘23 collection featuring graphics by renowned Los Angeles tattoo artist, Dr. Woo, who also made a personal appearance in the store.
Other brands were showcased during the event, ranging from the pricy Thom Browne to Rains, a much less costly Danish brand focused on waterproof items that will no doubt be useful for Vancouver’s damp weather.
Bringing experiential elements into the store are part of Holt Renfrew’s push in the menswear category according to Carolyn Wright, VP of Product and Planning at the retailer. A considerable amount of effort went into the menswear events held in Vancouver as Holt Renfrew aims to secure market share in the competitive Canadian market.
Holt Renfrew is something of an ‘ecosystem’ according to Wright, with Holts carrying a range of brands and price points. She said that men are mixing and matching some brands, while seeking looks that are balanced between being refined and feeling comfortable.
‘Stealth wealth’ is a trend seen with some Holt Renfrew customers, she said, as shoppers seek out quality goods that lack the logo-mania seen with some brands. Geographically, Wright said that there are some “slight nuances” to fashion geographically in Canadian cities, depending on financial centres, music scenes and sports teams. At the same time, Wright said that the “fundamentals are consistent” across the chain’s stores in BC, Alberta, Ontario and Quebec, with some brands doing gangbuster sales.
One of those brands is Los Angeles-based Amiri, which has become one of the top selling menswear brands at Holt Renfrew. The brand is known for its edgy streetwear styles and is flying off the racks at Holts – and a handful of other retailers carrying the brand. Sources have told Retail Insider that Amiri is looking to open a standalone store at Toronto’s Yorkdale Shopping Centre, being part of a trend where brands open their own stores.
Holt Renfrew, on its part, is investing in its brick-and-mortar retail business in a big way. Construction will soon start on a new men’s department that will be located on the third floor of Holt Renfrew’s flagship store at 50 Bloor Street West. The department is expected to open in the fourth quarter of 2024, according to Wright. Moving the men’s department back into the flagship makes sense, as some women also shop for the men in their life. Having things in the same building is just more convenient.
Holt Renfrew’s flagship store at 50 Bloor Street West in Toronto. Photo: Craig Patterson
The new men’s department will replace a standalone Holt Renfrew men’s store that opened in the fall of 2014 at 100 Bloor Street West (corner of Bellair Street). The two-level store has a leased area of about 16,500 square feet (rent said to be $4 million annually), and is the only standalone store of its kind in the chain. The relatively small men’s store lacks the boutique concessions found at Holts in Vancouver and Montreal.
Wright noted another recent major investment made by Holts in Montreal, with the building of the beautiful 250,000 square foot Holt Renfrew Ogilvy store that occupies six floors on Ste-Catherine Street West. The 40,000 square foot men’s floor on the fourth floor is by far the largest men’s department in the Holts chain in terms of size, and features an impressive roster of luxury brand concessions and boutique spaces.
Holt Renfrew relocated its Vancouver menswear space to a new concourse level space several years ago. Sales are robust at the store, which is said to be the top-selling location in the chain. That includes an impressive menswear selection that includes a mix of luxury brand concessions (such as Louis Vuitton, Celine, Burberry, Dior, and Louboutin) and other brand presentations. The men’s store can be accessed via its own entrance onto Howe Street, making it convenient.
Holt Renfrew Ogilvy men’s floor in Montreal. Photo: Holt Renfrew
Calgary’s Holt Renfrew store includes a dramatic looking menswear floor featuring soaring ceilings and a range of upscale and luxury designers. Holt Renfrew recently renewed its lease for its downtown space that spans about 150,000 square feet over four levels. Three of those levels are retail space and it’s said that there’s room to expand retail space in the building if needed.
Mississauga has an architecturally unique Holt Renfrew store at Square One that opened in 2017. It includes a men’s store with its own entrance. The menswear selection is more casual at the Mississauga store, catering to demographics in the area.
The Yorkdale Holt Renfrew men’s offerings are spread across the store, including in concessions and a dedicated menswear area. Five of the concessions are ‘world of’ in terms of selection, thus carrying menswear along with other categories for women. A renovation to part of the store, expected to be completed in 2025, will see some changes to the Yorkdale Holt Renfrew that will include some of its menswear offerings.
Men’s store entrance at Holt Renfrew, Square One, Mississauga. Photo: Holt Renfrew
Holt Renfrew is uniquely positioned in the Canadian market. For years it has dominated luxury retailing in Canada, and it continues to do so with its mix of retail and concessions for the world’s top luxury brands. Despite competitors coming into the market, Holt Renfrew has maintained its dominance as a place for shoppers to obtain luxury brands.
Holt Renfrew has less competition in the menswear sector as of late, with Nordstrom exiting the country in the spring while shutting its six standalone stores here. Nordstrom’s fashion offerings for the most part were of a lower price-point compared to what’s at Holt Renfrew, although there was crossover in terms of brands and shoppers. Saks Fifth Avenue has also substantially reduced its designer men’s offerings in Canada, particularly in Calgary where the store’s men’s department has recently been downsized to the point of being almost non-existent. Saks also downsized its CF Sherway Gardens store in Toronto during the pandemic, relocating its lower-level men’s store to a smaller area upstairs with womenswear.
Brands opening their own stores, not to mention online sales, are all potential headwinds for retailers such as Holt Renfrew. International luxury brands are targeting Canada by opening stores like never before, and this will continue into the future as demand dictates and the market matures. When some brands enter a market by opening retail stores, they may pull the brand from multi-brand retailers — a trend reported on in Retail Insider more and more in recent years. Some brands operating concessions in larger retailers may also decide to eventually open standalone stores. And to add to the competition, luxury brands entering Canada also often open local e-commerce sites, if they don’t have one already.
Entrance to the men’s store at Holt Renfrew in downtown Calgary. Photo: Holt Renfrew
Online multi-brand retailers such as Montreal-based SSENSE, as well, are taking market share in the menswear space. SSENSE carries a wide range of luxury brands and manages to secure some exclusives through relationships with brands. SSENSE is marking 20 years in business and is marking it with a big celebration this month.
Some men are even turning to the resale market for some luxury goods, ranging from hoodies to sneakers to jewellery. That includes some popular e-commerce sites as well as a growing number of brick-and-mortar retailers. The younger generation, in particular, is becoming more focused on the circular economy and used goods are usually cheaper than new ones, which is a bonus (we won’t get into the world of sneakers, where prices are sometimes based more on demand).
Toronto-based menswear retailer Harry Rosen is looking to take some market share from Holt Renfrew with the recent introduction of some more casual brands at luxury price points. Newly introduced brands to Harry Rosen, carried at the Bloor, Yorkdale and Vancouver locations, include Balmain, Marni, Jil Sander, Kenzo and Maison Margiela. Retail Insider recently interviewed President Ian Rosen, who said that the retailer was buying all categories for these brands and that other Harry Rosen locations would stock some of these brands in future seasons. All five of the new brands mentioned above that are carried at Harry Rosen are also carried at Holt Renfrew, including on its website.
Produce at Eataly Bloor Street (Image: Dustin Fuhs)
Food inflation in Canada has dropped to 5.9 percent, a nearly 1 percent decline since August. On the surface, this may seem like a reason to celebrate, with grocery trips becoming somewhat less burdensome on our wallets. However, the pressing question remains: do Canadians genuinely believe the data released by Statistics Canada?
A quick glance at social media commentary reveals the skepticism that Canadians harbour toward the numbers churned out by Ottawa. Trust seems to be at an all-time low, and many rely on their gut feelings rather than official statistics. Even though the data indicates that food inflation is at its lowest since January 2022, the gap between general inflation and food inflation has shrunk to 2.1 percent, and several food items have become more affordable, Canadians remain unconvinced.
Interestingly, Canada boasts the second-lowest food inflation rate among G7 countries, trailing only the United States at 3.7 percent. But it appears that no matter how reassuring these statistics might be, Canadians want none of it.
Skepticism and cynicism now dominate public sentiment toward the food industry, and it’s not hard to see why. Recent events, such as the legal disputes between major grocery chains, Metro, Loblaw, and Weston, only serve to exacerbate the public’s distrust. Metro has taken legal action against Loblaw and Weston, claiming they “falsely implicated” it in a price-fixing conspiracy regarding bread. This scandal, infamously known as the “bread cartel,” allegedly persisted for 14 years between 2011 and 2015, yet the Competition Bureau’s investigation, which began in 2015, is still ongoing. While one company, Canada Bread, admitted guilt and paid a substantial fine this summer, the infighting between grocers continues. This ongoing turmoil harms the industry’s image and further erodes consumer trust.
Against this backdrop, the Canadian Centre for Food Integrity released its annual public trust report, a survey designed to gauge Canadians’ trust in the Canadian food industry. While the report addresses critical issues like inflation, food affordability, and sustainable industry practices, it overlooks pressing concerns affecting public trust today. Notably, it says nothing about perceived profiteering, persistent farm waste especially in dairy, trust in data provided by Statistics Canada, or potential collusion within the industry. This omission is unfortunate, as these issues are central to rebuilding public trust.
There is currently no concrete evidence of grocers, manufacturers, or other industry players profiteering. Nevertheless, 82 percent of Canadians believe that profiteering is somehow associated with rising food prices, according to a recent survey. This perception poses a significant challenge that the industry must address promptly.
The legal disputes between grocers, coupled with a public trust report largely funded by the industry, only add to Canadians’ skepticism about the food industry. Trust in the sector is fragile, and it is essential that every stakeholder, from government bodies to industry leaders, work diligently to rebuild it.
Ottawa’s efforts to stabilize food prices by encouraging grocers to lower prices are commendable, but the real issue at hand is trust. The food industry can no longer take Canadians’ trust for granted. Rebuilding trust will require transparent communication, greater accountability, and a commitment to addressing the public’s concerns, whether they relate to perceived profiteering, farm waste, trust in data sources, or potential industry collusion.
It’s time for the food industry to not only deliver quality products but also to prove that it deserves the trust of Canadian consumers. Food inflation might be on the decline, but restoring faith in the industry is the true measure of success.
A majority (78 per cent) of small retailers say they’re losing revenue and customers to big businesses, according to a new report by the Canadian Federation of Independent Business (CFIB), which reminds consumers to challenge the way they think about shopping local.
The report, created in partnership with Scotiabank, is entitled Small Business, Big Impact: Small Retailers’ Local Contributions and reveals that over nine in 10 Canadians (92 per cent) said they love having small businesses in their community, but only 13 per cent do most of their shopping at small businesses.
Emily Boston
Instead, most people (87 per cent) reported doing the bulk of their shopping at large multinational retailers, either in-store or online.
“Even a small change in spending habits will have a positive impact on local economies. Small businesses are the cornerstones of our communities. They hire and train the next generation of leaders, offer unique products and personalized services, and foster a strong sense of community,” said Emily Boston, a Policy Analyst at CFIB and the co-author of the report. “We encourage everyone to prioritize shopping local not just during Small Business Week, but throughout the whole year as well.”
“Despite the many contributions that small businesses make to their communities, most consumers don’t support them on a daily basis even though they recognize the importance of shopping local. There are many misconceptions among consumers, including that small retailers and multinational businesses contribute to local economies equally. In fact, when you shop at a small, independent retailer, six times more of that money stays in your local economy than when you shop at a large multinational retailer,” said Taylor Matchett, CFIB’s senior research analyst and co-author of the report. “Small businesses are also more price competitive than you think. Changing your current habits does not have to come with a higher price tag or less convenience.”
Taylor Matchett
The report found that nearly all small retailers (97 per cent) said they contribute to their community or province in at least one way— the top ways they do so include donating to charities and causes (74 per cent), sponsoring local events and teams (56 per cent) and providing job opportunities for youth (55 per cent).
In this video interview, Boston discusses the report and its impact on the small business community in Canada.
https://www.youtube.com/watch?v=ehVxoJdwizQ
The Video Interview Series by Retail Insider is available on YouTube.
Connect with Mario Toneguzzi, a veteran of the media industry for more than 40 years and named in 2021 a Top Ten Business Journalist in the world and the only Canadian – to learn how you can tell your story, share your message and amplify it to a wide audience. He is Senior News Editor with Retail Insider and owner of Mario Toneguzzi Communications Inc. and can be reached at mdtoneguzzi@gmail.com.
Also check out the other series offered by Retail Insider, including The Weekly podcast and The Interview Series, which are both available on Apple Podcasts, Stitcher, TuneIn, Google Podcasts, or through our dedicated RSS feed for Simplecast and other podcast players.
Technology is enabling more Generation Z Canadians to become successful entrepreneurs in the country.
A new report by technology company Square, Gen Z: A New Age in Canadian Entrepreneurship, found that Gen Z entrepreneurs in Canada believe they have better opportunities than previous generations.
Key findings from the report include:
The top-three reasons they are more entrepreneurial are due to social media (40 per cent), young and successful influencers (40 per cent) and greater access to technology (36 per cent);
Three in four believe Gen Z is more open to alternative paths to success instead of a corporate 9–5 job; and
Being one’s boss is a top motivator for 40 per cent of Gen Zers wanting to start a business.
Despite facing greater barriers to entry into the economy, Generation Z is embracing entrepreneurship in Canada with an optimistic outlook. The report is based on the findings of a survey conducted with 400 Canadians aged 18–27 who own a business or are in the process of starting one, conducted in collaboration with Leger.
Image: Square
The report found that technology is a big factor in growing these businesses from part to full time, with 79 per cent of respondents saying they consider technology tools, such as payment processing, essential to starting a business.
More than a third (36 per cent) attribute Gen Z’s entrepreneurial nature to greater access to technology and related tools. But they still lack comfort with some of the financial tasks required to run a business: 86 per cent of respondents have at least one finance-related task they feel ill-equipped to handle, with more than one-fifth (22 per cent) struggling with knowing how to secure funding. Some (21 per cent) also admit to difficulties with budgeting and cash flow management, and another 19 per cent find it difficult to manage invoices.
Image: Square
Roshan Jhunja
“There can be many unknowns when starting a new business, but the right tools and financial services can help,” said Roshan Jhunja, head of retail at Square. “Generation Z is one of the most innovative and entrepreneurial demographics to date and Square is committed to empowering them by offering a comprehensive suite of hardware, software and financial services to help them start, run and grow their businesses.”
Some other key findings from the report include:
56 per cent of respondents believe they have better economic opportunities than the previous generation. A far larger percentage of men (60 per cent) than women (49 per cent) shared this optimistic outlook;
When it comes to entrepreneurial role models there is a significant gender divide, with 34 per cent of male respondents indicating they looked up to Elon Musk the most. Women had far less interest in Musk (14 per cent), favouring entertainers-turned-moguls Selena Gomez (25 per cent), Ryan Reynolds (18 per cent) and Rihanna (18 per cent);
51 per cent of women indicated that growing a customer base was the number-one success factor, compared to only 38 per cent of men. Women were also far more concerned with customer satisfaction (39 per cent) than men (29 per cent).
77 per cent believe Gen Z is more open to alternative paths to success instead of a corporate 9–5 job than previous generations.
Jasmine Linton on The Great Canadian Baking Show (Image: CBC)
“We’re not only more open to alternative paths, but in many cases, I think we actually prefer it,” said Linton. “Being able to do my own thing on my own time, rather than being confined to 9–5, is part of what led me to start my own business.”
Linton is, however, in the minority: 25 per cent of Gen Z entrepreneurs consider their business a full-time endeavour while 53 per cent see their businesses as side hustles.
Future Dibs Scratch Bakery in Richmond Hill, Ontario (Image: Dibs Scratch Bakery)
To learn more about how Square enables commerce in person and online, supports new revenue streams, streamlines operations and helps business owners better manage their cash flow, visit Square.ca.
Methodology
Leger conducted an online survey of 400 Generation Z Canadians aged 18–27 who own a business or are in the process of starting a business soon. The survey was completed between March 30 and April 15, 2023, using Leger’s online panel. No margin of error can be associated with a non-probability sample (i.e., a web panel in this case). For comparative purposes, though, a probability sample of 400 respondents would have a margin of error of ±5% 19 times out of 20.
Square Partnered with Retail Insider for this article.
An upscale wellness and social club will be opening on the upper level of the former Nordstrom Rack space at the southeast corner of Bloor and Yonge Streets in downtown Toronto. The new initiative by Altea Active will be called AVANT, and it will serve an affluent demographic that lives in the area.
AVANT by Altea Active will occupy about 31,000 square feet in total, with most of that space being the upper level of the Nordstrom Rack store that shut in May of this year, along with all Nordstrom stores in Canada. AVANT will have a dedicated street-facing entrance on Bloor Street in a building owned and managed by First Capital REIT at 1 Bloor Street East.
The fitness concept, set to open in early 2025, will feature industry-leading studio fitness offerings, state-of-the-art strength and cardio equipment, private and small-group training options, and an array of high-end amenities. Catering to an upscale demographic, Altea Active said in a statement that AVANT will take a hospitality-forward approach in the new facility with “unrivalled amenities and premium offerings” in a space conceptualized by Chapi Chapo Design. Included will be the “comforts found in five-star hotels and urban oases around the world.”
1 Bloor East (Image: Dustin Fuhs)
Altea Active says that it is known for “customizing clubs to the demographic of its host neighbourhood,” and the luxury positioning of AVANT makes sense. The high density area nearby includes a considerable number of high-income households, and the population is growing rapidly as new apartment condominium towers are built.
AVANT will compete particularly with two other high-end fitness concepts in the neighbourhood, including an Equinox gym at Yorkville Village (formerly Hazelton Lanes) and boutique fitness concept Barry’s Bootcamp, located at the back-end of 100 Bloor Street West. The Bloor-Yorkville area is otherwise highly saturated with fitness facilities that include three GoodLife gyms (including a recently renovated Manulife Centre location) and boutique fitness concepts such as F45, Orangetheory and others.
Altea Active has signed a long-term lease with First Capital REIT for the new AVANT location at Yonge and Bloor. “With the signing of the long-term lease, the Altea team looks forward to serving the Yorkville neighborhood for decades to come,” said David Wu, Co-Founder and President of Altea Active in a statement.
Mackenzie Kohl of Avison Young worked with Altea Active in negotiating the lease deal with landlord First Capital Realty.
Michael Nolan, Co-Founder and COO of Altea Active said in a statement, “We couldn’t be more excited to introduce Yorkville to AVANT, and to deliver a brand-new, ultra premium experience to the community. This evolution is a major milestone as we continue to elevate our member experience and push the boundaries of what a fulsome wellness and social club should be with premium amenities and luxury hospitality infused at every touchpoint.”
“We are excited to join this project, fusing our global expertise in luxury hospitality design with the unique essence of the Yorkville community to craft something extraordinary,” states Boris Mathias, Partner & Co-Founder of Chapi Chapo Design, “drawing inspiration from the world’s most prestigious hotels and luxury experiences”.
Eric Sherman of First Capital REIT negotiated the lease deal on behalf of the landlord for AVANT prior to being promoted to a new role. “We are incredibly excited to be working with the Altea team to deliver a revolutionary concept in the luxury fitness and wellness space that we are confident will be embraced by the Bloor-Yorkville community,” said Sherman, who is now Head of National Operations at First Capital REIT. “We continue to enhance our neighbourhood portfolio with best-in-class brands and operators and Altea certainly aligns with this strategy.”
Altea Active opened its first location in November of 2019 in Winnipeg, spanning about 80,000 square feet. A second location, spanning about 89,000 square feet, opened in Toronto’s Liberty Village in March of 2022. A new 43,000 square foot location is scheduled to open next month in Vancouver’s Mount Pleasant area.
CF Toronto Eaton Centre on Saturday, November 26, 2022 (Image: Dustin Fuhs)
Canadians are projected to spend an unprecedented $898 this holiday season with 88 per cent of them seeking ways to make their budgets go further, according to the 6th annual RCC X Leger Holiday Shopping Survey from the Retail Council of Canada (RCC).
The survey was conducted by Leger.
Diane J. Brisebois
“Even with prevailing financial concerns on Canadians’ minds, the desire to connect with loved ones and shop and share gifts and experiences remains undeterred,” said Diane J. Brisebois, President and CEO, Retail Council of Canada. “Retailers across the nation recognize these needs and will be providing Canadians with unique holiday shopping experiences, bolstered by exceptional products and engaging, value-added promotions.”
Key findings from the report include:
Landsdowne Centre (Image: Colliers)
Canadians predict they will spend an average holiday expenditure of $898, a rise from last year’s $782. A substantial 80 per cent of this amount will be allocated for gifting others;
Economic apprehensions, including inflation and rising living costs, weigh on many. Accordingly, 88 per cent (vs 83 per cent in 2022) of Canadians are turning to proactive holiday shopping tactics, most notably hunting for sales (52 per cent), preparing in advance (41 per cent), and adhering to a precise budget (40 per cent);
To help shoppers decide which retailers to buy from this year, Canadians are prioritizing holiday sales/promotions (66 per cent) and free shipping (55 per cent). They are also looking for in-store exclusives (48 per cent) and distinct online promotions (60 per cent) to provide additional value;
In-store shopping will benefit from value bundles (26 per cent) and product sampling (25 per cent). Conversely, online shopping will be amplified by unique product offers and extended return policies, both at 33 per cent;
A growing number of Canadians are delaying significant buys, waiting for expected deals around the popular shopping holidays. The survey highlighted anticipated increases in shopping intentions for: Singles Day (10 per cent, up from five per cent in 2022), Black Friday (40 per cent, up from 28 per cent in 2022), Cyber Monday/Week (37 per cent, up from 21 per cent in 2022), and Boxing Day (32 per cent, up from 18 per cent in 2022);
Clothing emerges as 2023’s frontrunner, constituting 17 per cent of the holiday budget, followed closely by home entertainment and essentials like food and alcohol grabbing 16 per cent of the planned spend;
45 per cent of shoppers are leaning towards purchasing gift cards for others this season, with a notable 37 per cent of Canadians (up from 32 per cent last year) expressing a preference for receiving gift cards over traditional presents. Dining gift cards top the charts (42 per cent), while big-box retailers come in at 33 per cent and food outlets register at 27 per cent; and
Supporting local businesses this holiday has seen an increase in intent, with 82 per cent of Canadians accentuating its importance, a leap from 74 per cent last year.
Black Friday Sales at GameStop in the CF Toronto Eaton Centre (Image: Dustin Fuhs)
“Our findings for 2023 are both exciting and instructive. 90 per cent of Canadians plan to shop this holiday season. While they anticipate spending more than ever, 88 per cent are also looking proactively at various ways to get the most value. Even more than in previous years, many are holding off buying and planning to make their bigger purchases around hallmark shopping events like Black Friday and Cyber Monday/Week, in anticipation of grabbing the best deals,” said Brisebois in the report.
“However, as we see in a new section of this report based on Moneris’ historical payment data, planned and actual shopping don’t always align. If shoppers are not finding the deals they are expecting, they wait. This signals an unmatched opportunity for retailers: present the best offers at the right time and guide consumers to confidently make their purchasing decisions throughout the holiday season.
“The pandemic’s impact on reshaping shopping dynamics appears to have now stabilized, with 62 per cent of holiday budgets likely being spent in-store, and 38 per cent online. Today’s consumers are nevertheless seeking both unique experiences and offers to bring them into stores as well as distinct online offers to provide additional value. Tangible benefits, such as special savings, free shipping, hassle-free returns, and genuinely exclusive offers, will be the cornerstone traffic builders this year.”
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 2 days.
Buy now, pay later is a relatively new form of financial technology that allows consumers to purchase an item immediately and repay the balance at a later time in instalments.
However, the newness of buy now, pay later programs means existing consumer credit laws don’t cover it. This lack of regulation puts shoppers at financial risk of accumulating higher levels of debt.
Credit cards versus buy now, pay later
There are three key differences between credit cards and buy now, pay later loans. First, while buy now, pay later loans are a line of credit like credit cards are, they don’t impact credit reports. Because of this, shoppers might be less cautious when using buy now, pay later services.
Shoppers are at risk of overusing buy now, pay later programs and accumulating more debt than they can manage. In addition, formal lenders, such as banks, currently have no way of knowing what buy now, pay later debt a person is carrying. The lender, therefore, likely incurs more risk than they are aware of.
Third, people typically have just a few credit cards, making it easier to keep track of payments. Buy now, pay later users, on the other hand, usually engage with multiple buy now, pay later lenders through retailers. As a result, it’s difficult for them to keep track of all the buy now, pay later lenders and retailers they made purchases from.
What are the Canadian governments doing?
Canada classifies buy now, pay later as an unsecured instalment loan, which means lenders are subject to laws at the federal and provincial levels.
Under federal law, there is an annual interest rate cap of 60 per cent. Provincial laws require buy now, pay later lenders to disclose the cost of credit and extend consumer protection rights to buy now, pay later shoppers.
At the provincial level, specific laws come into play. Manitoba, Alberta, Québec, and Ontario have passed laws that require lenders to be licensed before they offer these products and be subject to regulatory oversight.
These laws regulate high-cost credit products that have annual rates of 32 per cent or higher. This means buy now, pay later services should fall under this category. However, I found no evidence of buy now, pay later lenders being licensed in Canada. This means either lenders are not aware they fall under these laws, or no one is enforcing them.
This ambiguity over whether or not buy now, pay later lenders are subject to regulatory oversight could be a hindrance for banks like the Bank of Nova Scotia and the Canadian Imperial Bank of Commerce, as it deters them from entering the buy now, pay later market despite its profitability.
Questions to ask before using buy now, pay later
Before signing up for a buy now, pay later loan, shoppers should consider the following six questions.
1. Payment structure. How much of the invoice amount needs to be paid upfront? The norm is typically 25 per cent. What is the number of remaining instalments? The answer to this is usually four. Lastly, what is the frequency of instalments? The norm is biweekly.
2. Sensitive information. Does the lender require you to provide information about your chequing account? This is sensitive information to give away and puts you at risk of data breaches. Most buy now, pay later lenders withdraw instalment amounts from chequing accounts or debit cards, potentially exposing shoppers to greater risks than credit cards.
Shoppers are at risk of overusing buy now, pay later programs and accumulating more debt than they can manage. THE CANADIAN PRESS/Cole Burston
3. Interest charges Does the buy now, pay later lender charge interest on instalment payments? The norm is no.
4. Late fees How much is the late fee, when does it apply and what is the maximum amount of the late fee? Typically, late fees don’t exceed $8 or one-quarter of the invoice amount. Late fees usually kick in if your scheduled payment remains unpaid after 10 days.
5. Data responsibility. Who is responsible for your data? Whether it’s the retailer, the buy now, pay later lender or a company whose cloud storage the provider may be using, you should know. In general, the buy now, pay later lender holds this responsibility.
6. Licensing. Is the buy now, pay later lender licensed to sell the loan? Usually, the answer to this question is no.
Buy now, pay later regulation
Two sets of laws and regulations should be implemented to address some of these issues. The first set of regulations focuses on how buy now, pay later lenders interact with consumers. These lenders should clearly communicate all terms and conditions of their loans, including late charges, interest charges and payment schedules, on their platforms to ensure shoppers are fully informed of their financial obligations.
The Financial Conduct Authority in the United Kingdom recently issued guidelines allowing buy now, pay later lenders to terminate, suspend or restrict access to shopper accounts for any reason without notice. Effective September 2024, New Zealand will require buy now, pay later lenders to check a shopper’s credit before providing them a buy now, pay later loan.
The hope is that these laws and regulations will facilitate microlending and not impede the existence of buy now, pay later services, but rather make it safer and more secure for both lenders and users.
By Vivek Astvansh, Associate Professor of Quantitative Marketing and Analytics, McGill University and Chandan Kumar Behera, PhD Student in Marketing, Indian Institute of Management Lucknow.
