CF Polo Park in Winnipeg (Image: Cadillac Fairview)
Big things are happening these days at Winnipeg’s CF Polo Park – Manitoba’s premier shopping destination.
Recently the 1.2 million-square-foot mall, on two levels, welcomed first-to-market retailer, Zara, marking the retailer’s first foray into Manitoba. Located on Level 1 of the shopping centre, Zara occupies over 30,000 square feet of retail space, offering fashion for men, women and children. The centre has also opened a pop-up Knix, which will open its first permanent retail location in Winnipeg in Spring 2024.
“We are constantly evolving our retail mix and creating compelling experiences to serve and delight our customers,” said Peter Havens, General Manager, CF Polo Park. “We’re proud of our rich history in Winnipeg and supporting the city’s unique and dynamic market for retailers to launch their brands and the opening of these best in class retailers is a reflection of our commitment.
CF Polo Park (Image: Cadillac Fairview)
“Our big news is that Zara opened just prior to Black Friday and they’re certainly a first-to-market in Manitoba. They’ve been doing phenomenally well so far.”
Havens said Knix took over an existing store at the end of October with a full renovation to be done by the spring. But the brand wanted to be open in time for the busy shopping season. The permanent location will be about 2,300 square feet.
The shopping centre has about 205 tenants with an occupancy currently at about 94 per cent. CF Polo Park is considered a regional mall attracting consumers from across Manitoba as well as from Northern Ontario like Kenora and Thunder Bay and Saskatchewan too.
The past year or so has been a busy time for CF Polo Park. It started just over a year ago when Aritzia doubled its square footage into a new location while also opening an Aritzia Cafe. That kicked off other changes.
A new lululemon opened on the main level of the shopping centre. A Moose Knuckles also opened as well as Oak and Fort. About a year ago JD Sports was also added to the tenant mix.
“We’ve had a good run of some interesting tenants,” said Havens.
“There’s lots of stuff (still) happening but I can’t speak too much about it because we’re still confirming leases. Some of it is under contract but under confidentiality at this point.
“Cadillac Fairview has done a great job at Polo Park. We always evolve it to make sense in the market and bring those new and notables to the centre.”
CF Polo Park (Image: Cadillac Fairview) CF Polo Park (Image: Cadillac Fairview)
CF Polo Park is Winnipeg’s largest and busiest shopping centre, positioned in the top 20 highest performing shopping centres in Canada according to the International Council of Shopping Centre’s latest rankings.
“We’ve been working with the municipality to densify our site. We’re really fortunate. We have over 50 acres that can be used. It’s a pretty large unencumbered site,” said Havens. “So we’re working with the city right now and city planning to finalize those plans.
“The long-term plan would be to have upwards of 3,500 residences or various units throughout the property. The majority will be rental and obviously it’s quite far enough down the road that there might be a condo component as well. Every day in the news we hear about there’s a shortage of affordable housing and housing in general. It’s exciting to be part of the solution and when you look around the vast parking and the space around it, it will be really exciting to have that many more residential units around us and part of our mix.”
Cadillac Fairview and Shindico Unveil New Master Plan Vision for CF Polo Park (CNW Group/Cadillac Fairview Corporation Limited)
Cadillac Fairview is one of the largest owners, operators, investors and developers of best-in-class office, retail, multi-family residential, industrial and mixed-use properties in North America. Wholly owned by the Ontario Teachers’ Pension Plan, with assets under management of more than $30 billion, CF manages over 35 million square feet of leasable space at 68 landmark properties across Canada, including Toronto-Dominion Centre, CF Toronto Eaton Centre, Tour Deloitte, CF Carrefour Laval, CF Chinook Centre and CF Pacific Centre.
Havens said there’s been lots of opportunity coming out of the pandemic. The pandemic was like a wildfire for retail. Tenants were struggling. Some didn’t make it through the tough challenge.
“But those that were strong and were able to capitalize and saw the business of retail have done well. That’s why I think in the past 12 to 15 months we’ve seen a number of tenants expand, renovate. The example of Zara spending the dollars to come to Winnipeg and making another store in their portfolio. They see the opportunity to grow and to solidify their future. I think that’s been really good, especially for a city like Winnipeg. We certainly not very often get a first to Canada retailer. It’s just the nature of our market but when brands come here they typically do really well,” said Havens.
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.
Mary Brown’s Chicken, a Canadian based fast-food chain, is celebrating its 250th store opening, looking to expand to have 500 locations in Canada and 150 international locations within five years. The expansion plans include two new locations at the Toronto Pearson International Airport for early 2024.
Hadi Chahin
“Two years ago, we hit our 200th store and in early November of this year – we hit 250 stores, obviously a great milestone for the company. It shows our commitment to growth, our success we have been experiencing in the last few years in Canada, and it just got us really excited,” says Hadi Chahin, the CEO of MBI Brands Inc.
Celebrating its 250th milestone was supposed to be earlier, but after experiencing setbacks due to the pandemic, high interest rates, and delays with construction: “We are really excited about the next few years, because we have more lined up to open and every year we will be moving forward.”
Upcoming Expansions
Mary Brown’s Chicken at Edson, Alberta (Image: Mary Brown’s Chicken)
Mary Brown’s Chicken is expecting to open five new locations by the end of January, including one location in Calgary in Creekside and four locations in Ontario: Milton, Kitchener, Richmond, and Windsor. There will also be new openings at the Toronto airport.
“The big exciting one for us coming in 2024, will be opening two locations at the Toronto International Airport. There will be one in Terminal One and one at Terminal Three. It is exciting, and it will require a different approach to what we do with our Express – it is all about speed so you can get your sandwich within a few minutes and you are not waiting.”
The airport locations will open for March 2024.
What is next?
Chahin says the idea is to open around 45 new locations in 2024 with the goal to reach 500 stores in Canada within the next five years. This will include entering into the Quebec market within the next two years with the potential of having between 80 to 100 overall. The first locations will most likely be in and around Montreal.
“We do not have any stores in Quebec today and we are working on an expansion plan because we do see opportunity there, but due to our international plans ramping up quickly we have decided to delay the expansion by a year or two.”
Image: Mary Brown’s Chicken
In 2024, the company will be expanding internationally and will be opening locations throughout the UK, Pakistan, and Mexico. To start, Chahin says there will be between six to ten locations next year. The goal would be to have over 150 international store openings within the next five years.
International locations opening soon will be in Lisburn Northern Ireland, Leicester England, and Mexico – opening within the first two months of 2024.
“The key reason why we continued to be successful and we continue to grow fast is our focus on being the best chicken restaurant and we have been awarded, such as the best chicken sandwich or best chicken restaurant, and we really play in that field and we want to stay focused. We do everything from scratch and we are a full service restaurant focusing on chicken only.”
New Concept and Menu Innovation
Chahin says the company is building a new prototype which will have a new look and feel of “what the future stores are looking like.” The new concept is already ready and will be releasing a few of those now. Chahin says the new concept will have bigger spaces, improved drive-through, better guest experience, and everything will be digital such as menu boards and displays: “It will give you a look of the future version and it will be exciting.”
Mary Brown’s Chicken will also continue to expand its menu to include new items and flavours.
“The one thing we do well with and we want to continue to expand on is how we can introduce new flavours. In the past, we have introduced a grilled chicken sandwich and we are reintroducing the sandwich in January, but with a new flavour and a new bun – it is really a great product.Then we will be introducing a Korean chicken sandwich flavour come March next year. So the focus is not on changing what we do, but expanding our taste profiles with new and trendy flavours.”
Supporting Franchises – “We want them to grow with us”
Mary Brown’s Chicken at Avalon Mall (Image: Maurice Fitzgerald)
Chahin says the core of the business is supporting its franchises: “We want franchises to be successful – we want them to grow with us. Showing support to our franchises and making sure they are successful in their business has been one of the biggest factors of our exponential growth.”
Mary Brown’s Chicken has won the Franchise Choice Award 13 years in a row. To keep up to date, during the past year it has run engagement surveys to see how well locations are doing across different venues and stores.
“The surveys are a key factor we believe is going to drive us and make us different from anybody out there, and how we can make sure employee engagement and support is at the forefront in everything we do. When we take care of our people and grow with our people – they will support us back and take care of the guests; therefore, continue to drive the business forward.”
It was full circle recently in a way for two former Holt Renfrew executives who founded the T.LINE Toronto-based shirting brand.
The two returned to their roots at Holt Renfrew recently with a holiday pop-up in Calgary as the brand continues to grow its retail footprint in Canada.
Founded in 2022 by Britt Barkwell, a creative and marketing lead who launched editorial platforms at notable brands like Club Monaco and Canadian retailer Holt Renfrew, and Alia Bissett, the former Director of Strategy at Holt Renfrew, T. LINE is a contemporary womenswear brand built on the iconic staying power of shirt dressing.
T.LINE x Holt Renfrew Calgary (Image: T.LINE)Image: T.Line
“We both kind of felt there was something missing in the market but there was an opportunity to create a shirting first brand at a contemporary level. There were other brands that had been doing that but kind of felt a little bit irrelevant at the time,” said Barkwell. “We really felt that there was something at this price point that was lacking with shirting that had great complementary pieces that you could wear with shirting.
“During COVID and during our working professional lives as well, we wore a lot of menswear oversized shirts and that was really something that kind of defined our wardrobes and we felt that no one had really perfected this and during COVID we had small kids, we weren’t leaving the house but we both felt it was important to put on a crisp shirt and get ready for the day. It was something we felt very passionately about and it was missing from the market. We wanted to try and perfect this category, this item and see what happens.”
The shirts are menswear inspired.
Bissett said the brand launched in March 2022 being primarily direct to consumer. But then it started selling in September this year within all three TNT locations in Toronto.
“We did a pop up with them last March and they said it was the most successful popup that they’ve done since basically they started doing popups post COVID again,” said Bissett.
T.LINE x Holt Renfrew Calgary (Image: T.LINE)Image: T.LINE
The brand is also located in the VERT location in Toronto and at Tanya Taylor in New York City. A popup was also held at the Holt Renfrew in Calgary in the first couple of days of December.
“It performed really well and for us it was just an incredible full circle career moment for us to go back and sell at a place that we learned so much and grew so much at,” added Bissett.
“We’ve been very strategic about who we’re partnering with at the outset . . . As we move forward, we’re going to be strategic about where we go but continue more of an omnichannel focus.”
Image: T.Line
Image: T.Line
Barkwell said the plan now is to grow strategically and balance its production with its growth.
“That’s really important to us. We try not to overproduce. We like to sell through each collection. So we’re only producing enough and also create a bit of demand,” she said. “We usually do about three drops a season. We want people to shop quickly and if things sell out that’s kind of the model. We’re okay with that. We’ve been creating a lot of demand that way which we find it’s been working.
“We’re looking to be really strategic. We have our sights set on a European retail partner . . . We’re looking for potentially fall/winter 2024. We’re really trying to get the right partners. It’s really appealing to offer. A lot of the stores are looking for this type of animation that the monogramming brings just to create some interest in the store. And we know customers love personalizing while they’re shirting. That’s something really unique that we can bring.”
LOUIS VUITTON X YAYOI KUSAMA SOHO (Image: Louis Vuitton)
Image sharing and social media platform Pinterest has increasingly become a place for shoppers to engage in luxury retail.
Azadeh Attar, Industry Manager for Beauty for Pinterest, said a recent survey and report indicated that about 70 per cent of the luxury audience is from a younger demographic of under 35 years of age.
Azadeh Attar
Attar said people come to Pinterest to find ideas and then take action by bringing those ideas to life in the real world.
“That contrasts with a lot of different places online where you tend to just go to scroll, to pass the time, to be entertained. On Pinterest people are coming with this really strong intent to act. They’re there to get something done,” said Attar. “So from a brand perspective that’s really unique and special because brands actually play a role on the platform. A really important role in that they’re solutions that help you bring an idea into reality versus on other platforms, brands and their messages can feel like an interruption sometimes,” she said.
“So on Pinterest brands have an important place and a valuable place for the consumer . . . There’s this very large and young luxury audience on Pinterest and people who are specifically seeking out luxury and high quality premium products and brands.”
Image: Pinterest.com/LouisVuitton
She said Gen Z is creating culture and shaping our society in many ways. One of the other trends Pinterest is also seeing with Gen Z is an increased focus on sustainability and seeking out products that are not just ephemeral but will be durable and last a long time and luxury brands certainly fit in that scope.
Attar said there are 482 million monthly users on Pinterest on a global scale. In Canada, it’s just over 10 million monthly users that are growing.
“One of the reasons for that growth is that it is increasingly becoming a place where you’re spending quality time and one of the things I think we’re all becoming much more aware of is how we’re spending our time online,” she said. “Pinterest is really about not just mindlessly scrolling or passing the time but it’s about actually getting things done in our own lives. And it’s about everything from eating healthy to fitness to how we decide how to show up in the real world. Our outfits. Our beauty regimens. It really is about something very tangible about ourselves versus always kind of looking outwards and doing any kind of comparison but really working on our own selves.”
A multi-market survey conducted by PA Consulting shows that the consumers that luxury brands care about the most use Pinterest. While the global economic environment remains unstable, the luxury goods market is surging; it’s likely to double in size by 2030 on the strength of Gen Z spending, said Pinterest.
“Seventy per cent of the Pinterest luxury audience, defined as global users who have searched or saved one of 60 luxury brands, is under 35 years old. Four out of five are women,” said the company.
“A third of luxury shoppers on Pinterest have annual incomes exceeding USD $100,000 and are 35 per cent more likely to crack the six-figure mark than luxury shoppers at other platforms. Furthermore, they spend 87 per cent more on luxury goods and according to Global Web Index, they are 27 per cent more likely to buy premium products.”
Attar said luxury brands are of interest to Pinterest’s audience.
“Oftentimes Pinterest is described as a visual search engine or a visual discovery engine. So people are coming and actually inputting searches and saving images and videos and so those are really strong, intense signals that we can then look at from a high level and understand what are the interests people are exhibiting when they’re on the platform,” she said.
Kelly Emanuelli
“Luxury brands around the world have been connecting with their ideal audience on Pinterest: one that is coming to the platform with intent, looking for inspiration to curate ideas and refine their taste for which luxury brands to invest in. With three in five luxury shoppers saying they use Pinterest to research luxury brands and products, these brands have the opportunity to reach this highly engaged audience the moment they form an opinion and make a purchase decision,” said Kelly Emanuelli, Head of Luxury at Pinterest.
Pinterest said Louis Vuitton, for example, is finding its ideal audience on the platform.
“They wanted the launch of their colourful new collection in collaboration with the Japanese artist Yayoi Kusama to make a big impression and reach a maximum number of users interested in luxury, fashion and beauty in the UK, France, Germany, Italy and Spain. They launched a video campaign on Pinterest that enabled large-scale awareness through exclusive video placements. With more than 3.5 million users reached in just three days, Louis Vuitton’s campaign achieved strong engagement. This trend was confirmed during the second wave of the campaign, with six million impressions recorded in the French market, at a CPM 50 per cent lower than the vertical benchmark,” said the company.
“Another luxury brand engaging with their core audience on Pinterest is the luxury fashion and cosmetics powerhouse Carolina Herrera, which leveraged the new Premiere Spotlight video ad format to unveil their new Good Girl Maxi Glaze lipstick. This high-impact format, available on the search page and the home feed, helps brands like Carolina Herrera to reach a high-impact audience at scale and is a great starting place to drive users from discovery to decision to do. “
Image: Pinterest
The report said a third of luxury shoppers on Pinterest have purchased from the ‘Luxury fashion and leather goods’ category, and they are 34 per cent more likely to do so than people who shop elsewhere.
“More than two out of five Pinterest luxury shoppers have purchased from the ‘Luxury watches and jewellery’ category, and they are nearly 75 per cent more likely to do so than shoppers on other platforms,” said Pinterest.
“More than 80 per cent of Pinterest luxury shoppers have purchased from the ‘Luxury beauty’ category, and they are nearly 10 per cent more likely to do so than non-users.”
According to Global Web Index, nearly 85 per cent of Pinterest’s luxury users are more likely to see themselves as trendsetters and nearly 30 per cent more likely to buy premium products, and half of them buy luxury items for themselves.
“Sustainability and eco-friendly values are increasingly important factors in making luxury purchase decisions. In France alone, 64 per cent of respondents to the PA Consulting survey said that they are more likely to be loyal to brands that set sustainable goals,” said Pinterest.
“Pinterest is a different platform where luxury brands have the unique opportunity to reach an audience of young, intentional aesthetes with high purchasing power to establish a long-term connection to lead them from inspiration to action in a more positive online environment. More than half of all users consider Pinterest to be a shopping destination. They consider the experience to be personal and joyful. A luxury brand seeking to engage with young, affluent dream curators can find them on Pinterest.”
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 few days.
The retail sector in Canada continues to face challenges as it embarks on a new year.
Retail Insider asked three well-known experts in the industry to discuss what 2023 was like for retail in Canada and what we can expect in 2024.
Here are the thoughts of George Minakakis, author of The book, The New Bricks & Mortar, Future Proofing Retail, who also leads advisory firm Inception Retail Group; Gary Newbury, Strategic Advisor and Delivery Executive, RetailAID.ca; and Bruce Winder, author of RETAIL Before, During & After COVID-19 and President, Bruce Winder Retail.
1. How would you describe what happened in the retail industry in 2023?
George Minakakis
Minakakis: “Something had to give in 2023; it has been a journey of returning to somewhat normal competitive retailing. Yes, inflation and higher interest rates have had their impact, and a gradual consumer pullback has played out as I forecasted in mid-2021 when I referred to 2023 and 2024 as the rebalancing period. 2021 and 2022 saw phenomenal growth in sales and transactions driven by inflation, pent-up demand, and considerable savings accounts. 2023 has been the polar opposite; most retailers may have experienced negative to flat transaction growth. And, of course, as no surprise, we saw a shift with consumers conducting more bargain hunting probably by the beginning of June.
“Between 2021 and 2023, inflation has increased by 15 per cent, which was not economically sustainable for consumers. Hence, there is a shift to being more cautious and rebalancing their household spending. We should not be surprised if the last quarter of 2023 shows us an increase in shopping with debt, specifically with buy now pay later. I can’t ignore the layoffs in 2023 being indicative of doubt about the immediate future, so companies have been making changes from marketing to human resources.”
Victoria’s Secret Pink at CF Toronto Eaton Centre Closed to relocate inside Victoria’s Secret across the hall (Image: Dustin Fuhs)
Gary Newbury
Newbury: “When I think about 2023 I cannot look at this year in isolation without looking at trends which explained much of what has happened, emerging during 2022. As 2022 opened it became clear supply chain challenges from the previous two years and significant government borrowings had led directly to inflationary pressures. The Bank of Canada, slow to realize this, needed to put the brakes on this situation. Tiff Macklem started ratcheting up interest rates late Spring, catching out many folk renewing their fixed interest rate mortgage arrangements. The Ukraine war and its effects on energy prices, and disruption to trading patterns certainly impacted on consumer wallets. The public became very aware of how countries are interconnected globally through complex supply networks designed to chase the lowest price, often without provision for risks, as we found out. And remember, for parts of Canada, restrictions, vaccinations, masks etc were still being mandated. There was also a transition back from temporary saving to resuming spending on debt towards the end of 2022 (e.g. BNPL programs), resulting in the raising of debt-to-income ratio. During this time, some employers were mandating return to office arrangements (boosting short term sales of apparel), which continued to gather pace during 2023.
“Given this background, many retailers seemed to rush back to processes and thinking they knew prior to the pandemic, thinking the worst was over. The tome of “the new normal”. The only certainty we can rely on is increasing uncertainty (and disruption) and this means long range planning has to be approached thoughtfully and with the support of Boards and key stakeholders. However, this is tough to negotiate, so it seems the game has resumed and it’s back to “quarter to quarter” reporting cycles, with few lessons learned.
“There were clear winners (and losers) during the pandemic, consumers seem to adapt quickly to changing conditions, and for many, the rails started to creak as reality set in with rumours spreading of cutbacks and consumers experiencing, first hand, seriously rising prices in core elements of shelter, energy and food, leading to an anxious consumer mindset.
“2023 had many different signals, from headline figures of 1000s of open retail positions forcing restricted opening hours at some retailers, repayment of “pandemic relief loans”, excess stockholdings coupled with high levels of real estate occupancy/rates and, from the consumer side, the advent of ChatGPT and the promise this, in the hands of the consumer, was heralding a substantial change in the consumer – retailer dynamic.
“The economic threat of recession plagued 2023, however, more and more people were being caught in the accelerating interest rate drive, often finding their shelter costs had doubled, if not tripled, energy costs up 50 per cent + and food around 20 per cent, with wages remaining pretty static. So basically, consumers started to defer their spending and were on the hunt for better value, hence dollar stores, Walmart, Costco saw increasing sales, and mid-priced retailers were forced to run more frequent promotions, however, interestingly, seeing Canadian Tire, a good bellwether of consumer confidence, laid off staff just as peak trading started in Q4. This was quite telling of how they saw the short term. Another notable challenge was Mastermind Toys heading into trouble during their busy season. Plus many mid sized retailers (e.g. Indigo, Roots) reporting losses. Visibly, just travel around some of the smaller towns and cities and see the number of empty stores. “Space for rent”. The Canadian retailing industry is not particularly well set up for success as we look forward to 2024.
Future lululemon at 2 Bloor W (Image: Dustin Fuhs)
“2023 has really been a mixed bag and for some retailers, with strong brand advocacy, a clear market proposition and remarkable experiences, continue to run ahead of the pack (e.g Lululemon), with many other chains showing signs of leadership teams not innovating, not differentiating, not appealing to the new mindset of their consumers, not deploying technology to enhance their brand experience, and basically being caught with holding too much inventory investment and not being prepared to erode margins to convert this excess into cash for investment in their branding, technology or their in store design. It remains quite a surprise that retailers continue to put their gray tail items on their website, rather than consolidate their assortment into a focused proposition and mirror stores and online with a consistent and comprehendible “product”.
“I personally was watching Putman Investments moves during 2023, however, it looks like their enthusiasm for taking on a good proportion of the former Bed Bath and Beyond real estate and rebranding as rooms + spaces has not necessarily set the consumer alight, but it is early days. More recently the moves of Unity are extremely encouraging with taking on Kit + Ace and progressively revitalizing that brand, and now adding Mastermind Toys into the portfolio. So there remains encouraging, let’s call them sub trends, however, overall, the market, if one strips out inflation, looks pretty flat as a pancake.”
Winder: “2023 proved to be a year of reckoning for retail as the spending hangover from the pandemic finally took hold during the second half of the year.
Bruce Winder
“2021 & 2022 were positive years based on government subsidies and heightened household savings, leading to revenge spending at retail. 2023 is when spending finally slowed as the full impact of higher interest rates, sticky inflation in some categories like food and housing, recession worries, geopolitical issues and increased household debt were felt.
“As supply chain issues faded, consumers transitioned from chasing inventory and buying at full price to scouring the internet for super sales and finding creative ways to save money such as making holiday gifts, thrifting for some and even cutting back on the number of people to buy for during the holidays.
The Post in Vancouver (Image: Amazon)
“E-commerce enjoyed a renaissance of sorts. After a surge during the pandemic, online shopping took a back seat to brick and mortar shopping from a growth and interest perspective in 2022. With customer’s flight to value in 2023, e-commerce gained back popularity as a tool to find the best deals. Amazon released their 2023 impact report on December 20th (https://www.aboutamazon.ca/news/company-news/5-highlights-from-the-amazon-canada-impact-report) and with over 20 fulfillment centres and 60 shipping facilities in total, 4,500 Canadian cities are now able to buy 20 million items under Prime and receive them in one to two days in many cases. Online shopping has never been easier, more convenient and more comprehensive in Canada.
“We also witnessed some retailers bowing out in 2023. From Nordstrom to Bed, Bath & Beyond to Bad Boy and Mastermind Toys, we lost some big names. At the same time some of them were reincarnated as rooms + spaces or bought as a smaller version of themselves (Mastermind bought by Unity). In retail when the going gets tough, the weak get going. There are also many new-to-Canada retailers who either announced plans to open here or opened. A retail circle of life sort of thing.
“Generative AI took centre stage in retail (and the world) as the next panacea through ChatGPT and similar solutions that offer advanced search features and customer service capabilities. But this is just the tip of the iceberg for how AI can enable retail.”
Mastermind Toys at Bayview Shopping Centre (Image: Dustin Fuhs)
2.What are your thoughts about the industry in 2024 and how it will fare?
Minakakis: “We will remain in this rebalancing period throughout 2024. That will mean more cautious spending as consumers will face larger mortgage payments. In other words, the damage of inflation has yet to be felt by everyone or every retailer. There are several shifts that I see happening in 2024, and they will be investments to be ready for the following six years. Personalization will be the low-hanging fruit for retailers focused on retaining their customers. More will invest in an omnichannel evolution as there is a need to collect meaningful data to stay connected with customers and attract new ones. With larger retailers looking at Artificial Intelligence as business enhancement and even as a technological predictive partner, there will be changes to how we compete. We will see hyper-competitive behaviours, which means real-time actions to grow sales and market share. You will need a higher level of market intelligence to deliver that. And finally, this will call for corporate reinventions in their operating structures. 2024 will be the beginning of organizations embracing AI Factory structures. Retailers should also be mindful of sustainability and environmental and climate change risks. 2024 will be the preparatory year for 2025-2030, a strong growth cycle. This means the right people, skills, and strategies must be in place.”
Newbury: “2024 will be tough, very tough. Of course, the winners from the last few years will likely continue to drive distance between themselves and their competition. What of the fabled “middle’? Those retailers using a high/low pricing model, not clearly differentiated and sitting in a discretionary spend category (like apparel, electronics or other general merchandise categories)? They’ll have their work cut out. We will likely see a few notable withdrawals from the market (during 2023 we saw Nordstrom finally cut their losses and Lowe’s pull out of Canada via a PE buyout) and many store closures as part of “right sizing” fleets, availability shortfalls (through ongoing supply chain disruptions, as well as suppliers saying enough is enough, pay up now!) and assortment reduction as retailers focus on cash preservation.
“This is the playbook from the Great Recession. Back then it was driven by calamity in financial markets, which lasted around 18-24 months. We’ve already been subject to monumental disruption for 48 months, and we are not through it yet. 2024 starts with the Red Sea disruption (and Panama Canal’s low water mark) and the escalation of container prices, once again. What changes have we made in the supply chain? I would propose, not as many as the narratives around resiliency and sustainability will have us believe. If we add in US, UK and other EU general elections, the geopolitical situation, plus the War in the Middle East can not be ignored. We may even have to contend with a snap election here, troublesome for longer term planning and investment.
“Key to survival will be leadership/brand self reflection and a clear definition of “what problem are we really solving for our target segment?” and “Is the target segment big enough to warrant investment” and “can we develop competitive strategies to be a market leader/trend setter?”
“Taking bold decisions of how a proposition can be presented more clearly to the market to drive more value both to the consumer and to the bottom line is vital during 2024. Gaining a perspective on this will be key in moving from barely surviving, to thriving, and laying the bedrock for 2025 when our key trading partners will have their governments in place for the next four to five years and strategic plans can be developed.
“I wish all our retailers the best of luck. 2024 will not be for the faint hearted as it will require a new management vision for each business, and often needing different leadership skills, styles and org design, together with a clear focus on its purpose and roadmap to success, without distraction.”
50% Off Sale Signage at Saks Fifth Avenue CF Toronto Eaton Centre (Image: Dustin Fuhs)
Winder: “The first half of 2024 will mirror that of the back half of 2023. Tighter spending, more store closings. We will probably see a number of small and medium sized retailers close down in January or February due to a soft holiday in 2023. Some big names may leave Canada or sell to Canadian investment companies.
“The second half of 2024 could see some improvement as the Bank of Canada may start to carefully and slowly lower interest rates. It will take time though for the economy and consumer spending to pick up again. Don’t count on seeing cheap money again like we did previously. That was an anomaly. Hopefully fall 2024 will be better than fall 2023 as Canadians gain more confidence.”
Walmart Canada has launched “My Assistant,” an internal AI-powered chatbot, helping with efficiency and creativity for its home office associates. Sabrina Ratheekan, the technology leader at Walmart Canada, and Michon Williams, the chief technology officer at Walmart Canada, discuss My Assistant, benefits, and the future of AI at Walmart.
Sabrina Ratheekan
“My Assistant is a product my team worked on. It helps associates do things like draft a first email or a presentation plan – doing the first draft often takes the most time, so My Assistant will help speed up activities and serves as a collaborative partner,” says Ratheekan.
The internal tool, not yet implemented in stores, focuses on streamlining routine tasks and workplace innovation. As a secured platform approved by Walmart, associates can use My Assistant to help with creating drafts, help manage daily workload, summarize large documents, and will serve as a collaborative partner. Ratheekan and Williams say the change aligns well with Walmart’s commitment to being a people-led, technology driven organization – encouraging associates to use the platform for creative and complex work tasks.
Image: Walmart Canada
Ratheekan and Williams ensure My Assistant will not be taking over the human element, but is intended to complement employees’ tasks, enhancing productivity, and allowing associates to focus more on creative and strategic tasks. This highlights Walmart’s commitment to maintain a balance between technological innovations and human elements of decision making and customer service.
“As we work on tools like generative AI, it is not really about a replacement to human thinking, but it is really about complimenting and helping us with our day-to-day tasks. So it is improving the quality of our work and it also has the potential to continue to evolve and shape the way we work … AI cannot replace human thinking and creativity, but we will continue to use it as a complementary tool and it will continue to evolve,” says Williams.
Michon Williams
Similar to many Canadian businesses, Walmart is already incorporating AI into its operations. The company has been integrating AI technologies in various aspects of operations for a while now including for inventory management, optimizing supply chain processes, and enhancing the customer service experience within stores. AI helps Walmart understand future demand, helps with routing deliveries effectively, and helps manage its store inventory.
“AI is not new to us and we are embracing AI in a lot of different ways. We are very focused on accountable, robust, and secure use of technology, but we have been leveraging it for things like supply chain, stores to optimize inventory, and routing our trucks and deliveries in optimized ways,” says Williams.
Looking ahead: Walmart’s expansion with AI
Image: Walmart Canada
With the ongoing evolution of AI, Walmart will continue to explore new ways of using AI across its Canadian operations – both for office use and on the floor.
Ratheekan and Williams say Walmart is focused on enhancing different operations and customer service with using AI and they plan to integrate AI more deeply and possibly extend My Assistant to store level employees.
“This is the first generation of My Assistant, and we think that it could be more broadly applicable to people in stores once we have been able to integrate it with the company and human resource platforms. As we continue to innovate and adapt this technology, our goal is to make it a versatile tool – not just for our corporate team, but also for our store associates, enhancing the ability to serve customers and manage store operations more effectively. As we continue to learn more from home offices, I think that would be a good first step after we have integrated it with more information that is contextual to Walmart’s policies and procedures,” says Williams.
AI will also play a role in areas such as personalizing customer experience, logistics, supply-chain, and improving decision making processes. This will become a larger strategy to become an omni-channel retailer, blending online and in-store experiences.
“We will continue to build it and we will continue to discover new use cases as we go. We are introducing a lot of change in trying to become an omni-channel retailer, so associates are naturally curious about ways to make their jobs easier and how to optimize their tasks – we love to see that,” says Ratheekan.
“I think people are really excited that Walmart is taking this step. They are very curious about generative AI and how it can make their work better and we have a lot of positive excitement when people start to use the tool. I think they are pretty amazed at how it helps and people are starting to discover what My Assistant can do,” says Williams.
Lagoon Seafood, a leader in the distribution, import, export, and processing of fresh and frozen seafood, has opened its new $10-million facility in Granby, Quebec.
The new 63,000-square-foot facility houses more storage space, new production rooms, and state-of-the-art technology.
Michael Cheaib
“The completion of this project propels us forward in ways we could only dream of a few years ago” said Michael Cheaib, business resource manager at Lagoon Seafood. “Our expanded Granby facility is at the core of our company’s expansion into Ontario, Western Canada, and the United States to meet our new levels of customer demand. The renovated and expanded facility will support our commitment to bring new product lines across our market to respond to our customers’ needs most effectively.”
Image: Lagoon Seafood
The company said the new production and packaging facility mainly supplies Blue Tide branded and private label products. It has also significantly increased Lagoon Seafood’s storage capacity and centralized its logistics and storage process. It houses a freezer capable of accommodating more than 2,500 pallets of frozen products, includes new production rooms to support the company’s product innovation ventures and expand its capacity, and accommodates a new spiral freezer, a high-efficiency piece of equipment that shortens the time required to freeze products, maximizing freshness.
Founded in 1992, the family-owned and operated Lagoon Seafood specializes in distributing, importing, exporting, processing, and curing fresh and frozen seafood. Based on more than three decades of experience in the food industry, the company sources various products from South America to Asia, Europe to West Africa, and the Mediterranean, including local selections from Quebec and North America. Its catch comes from fishermen and fish farmers, allowing the company to better control its products’ origin and quality, grouped under the Blue Tide and Royal Harbour brands. Headquartered in Montreal, Quebec, the company moves its products to market with the help of select distributors, wholesalers, and direct-to-grocery and retail chains in Canada, the USA, Europe, and Asia.
The company also has facilities in Lachine in Montreal and in Nova Scotia.
Tony Vartivarian, Director of Marketing for Lagoon Seafood, said the new facility is specialized to create value-added products.
“We feel there’s a huge demand in the market and the competition lacks value-added products. Our clients want it. We feel there’s a huge opportunity for innovative fish and seafood products. We receive a lot of demands from clients and from customers about new products they can’t find in grocery stores.”
Image: Lagoon Seafood
Vartivarian said in the last two or three years, especially during COVID, the demand increased.
He said demand has always been consistent for fish and seafood throughout the years.
“Canadians love fish and seafood. They prefer Canadian products over any other products. They value their products, their own local products. It’s consistent. It’s steady,” added Vartivarian.
Lagoon Seafood said it has exclusive access to specific species of fish sought after in the industry. This is due in part to its strong partnerships with manufacturing facilities and fishing vessels in Nova Scotia.
A short video on Lagoon’s facility expansion is available on the company’s YouTube channel.
Grocery retailer Calgary Co-op continues to grow its business.
It announced Tuesday that one of its wholly-owned subsidiaries has entered into an agreement to become the majority shareholder in Care Pharmacies, with the transaction expected to close in the first quarter of 2024.
Care Pharmacies, founded in 2013, is headquartered in Vaughan, Ontario and has 56 drug stores in five provinces and it is currently the largest group of independent Canadian retail pharmacies controlled by licensed pharmacists.
“We believe that Care Pharmacies will be a tremendous fit with our focus on growth in health and wellness, led by Pharmacy and supported by Natural Foods and Home Health Care,” said Ken Keelor, CEO of Calgary Co-op.
Ken Keelor, CEO of Calgary Co-op
“This acquisition will follow enhancements we’ve made to our own pharmacies over the last few years, the earlier acquisitions of Beacon Pharmacies and Community Natural Foods, and continued growth and enhancements to our Home Health Care business. We are pleased to diversify our investment in communities across Canada.
“Our strategy is focused on health and wellness. It’s a growing trend. We’ve seen a lot of health care moving from hospitals and doctors over to pharmacists over the years and it’s a trend that’s going to continue as the health care system is more and more under pressure. So focusing on health and wellness, especially led by pharmacy but also supported by home health care as well as natural foods and Community Natural Foods, is clearly an area that we see as long term supporting the population locally and across the country.”
Keelor said the company’s number one commitment is to Calgary and area but it has been taking the opportunity to grow beyond Calgary’s borders in order to de-risk its members’ investment.
“It’s hard to grow by just staying in one city alone. And it’s hard to provide de-risked returns if all your eggs are in one basket . . . We’ve been growing geographically using some of these subsidiary companies that we acquire. They’re strong brands. They know their business. They come with an existing management team. So as we go along we have been looking at pharmacies . . . Pharmacies in general are a broad and exciting space for us to grow both in Calgary as well as beyond its borders.”
Image: Calgary Co-op
Calgary Co-op has more than 400,000 members and 3,850 employees with real estate assets of $700 million and annual sales of $1.3 billion. It is one of the largest retail co-operatives in North America, and is home to food centres, pharmacies, gas stations, car washes, Home Health Care centres, Wine, Spirits and Beer locations and cannabis. In addition, Calgary Co-op operates and is the beneficial owner of Beacon Pharmacies, Community Natural Foods, The Organic Box and Willow Park Wines & Spirits.
“Care Pharmacies has come from a bunch of different pharmacies getting together over the years and growing. It’s basically an independent pharmacy network. In many cases, the operator was wanting to retire or wanting to fold into a bigger business as long as he or she trusted that business,” said Keelor.
“So Care Pharmacies has built this culture of caring and being trusted much more so than the Shoppers Drug Mart and other companies that are very large and corporate in nature. Care’s values fit with Calgary Co-op’s values. It’s about caring. It’s about local community. In many cases, their stores are like a local community hub. It’s not just the only pharmacy in town but in some cases it’s the only retail store.”
After the closing of this transaction, Care Pharmacies will continue to operate as a separate entity. Ali Reyhany, CEO of Care Pharmacies as well as the rest of the Care leadership team, will continue in their positions.
Ali Reyhany
“We saw a strong alignment of values between Care Pharmacies and Calgary Co-op. As hubs within our communities, we know that Care Pharmacies will continue to be strong beacons of trust and service for Canadians and their health and wellness. We have found a great partner in Calgary Co-op and we look forward to continuing to grow our business across Canada,” said Reyhany.
Calgary Co-op used CIBC Mid-Market Investment Banking as its exclusive financial advisor in the transaction.
Care Pharmacies used BMO Mid-Market Mergers & Acquisitions as its exclusive financial advisor.
Image: Calgary Co-op
Keelor said Calgary Co-op will continue to grow its business by acquisitions.
“We have had some rapid growth over the last five years especially . . . We will continue to look at opportunities but obviously we have to steady the ship and grow what we have. Our focus is very much growing our business in pharmacy and our current business. It’s in growing our home health care business, our liquor business,” he said.
“It’s not all about acquisition. A lot of it is about growing the business that we have today but we never say never because opportunities come and go and you can’t time them. That’s why the strategy is very important. And the strategy is all about health and wellness growth, geographic expansion prudently with good governance and of course serving Calgarians as our primary focus but managing their investment in us in a way that we de-risk it and build sustainably.
“Pharmacy if you look at it, in 20 or 30 years is going to be an even bigger business. When you look at some of the other lines of business, we may not have the same opportunity for growth or stability over the next 20 or 30 years.
“So we’re also looking at our businesses and thinking ‘well this is a business that is on trend for the next 30 years’. Regardless of who is running our business in 20 years, they’ll have a solid foundation that we built for them as a management team and as a membership.”
