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Reitmans Emerges from Restructuring with Eye to Future Growth: Interview

Reitmans' New CF Carrefour Laval boutique. Photo: Reitmans
Reitmans' New CF Carrefour Laval boutique. Photo: Reitmans

Canadian retail giant Reitmans recently announced it has emerged from its restructuring proceedings through the Companies’ Creditors Arrangement Act and its President Stephen Reitman said he’s confident that its brands (Reitmans, Penningtons and RW&Co.) will flourish.

“We now begin a new chapter in our company’s almost 100-year history,” wrote Reitman in a publicly-released letter. “We remain a proudly owned and operated Canadian company, committed to serving millions of people across this country.”

Reitmans had filed for creditors’ protection on May 19, 2020.

Reitman's at Tsawwassen Mills in Delta, BC (December 2021). Photo: Lee Rivett.
Reitman’s at Tsawwassen Mills in Delta, BC (December 2021). Photo: Lee Rivett.
Stephen F. Reitman

In a recent news release, the retailer said it has paid to the Monitor appointed under the CCAA process, Ernst & Young Inc., the aggregate amount of $95 million with the Plan of Arrangement. It also announced it had entered into a senior secured asset-based revolving facility of up to $115 million with Bank of Montreal.

“The Credit Facility has a term of three years. Funds advanced under the Credit Facility will be used, among other things, to finance the amounts payable under the Plan of Arrangement and to fund Reitmans’ working capital needs and for its ongoing general corporate purposes, including new store openings and renovations,” said the retailer.

“As many of you know, Reitmans (Canada) Limited has been a family-run business based in Montreal for over ninety years,” wrote Stephen Reitman. “During this time, our organization has confronted difficulties and experienced great success. I have always been extremely proud of how our employees and leadership team have handled these ups and downs, and the resilience they have demonstrated.

“Nothing could have prepared us for the challenges we faced in the beginning of 2020.

Reitmans at Metrotown – Photo by Geetanjali Sharma

“With the start of the pandemic and the temporary closing of all 575 of our retail stores in March, we became completely reliant on our e-commerce business. It became clear that we would have to change our business model due to the uncertainty of when our stores would reopen. On May 29, 2020 we entered the Companies’ Creditor Arrangement Act (CCAA) in order to restructure the company and modify our work methods and processes. We were forced to close two beloved brands, Thyme Maternity and Addition Elle, and we made the painful decision to let go many dedicated and hard-working employees.”

In its latest press release, the retailer said it operates 412 stores consisting of 241 Reitmans, 93 Penningtons and 78 RW&CO

In December, the company released its financial results for the third quarter of its fiscal 2022, ending October 30.

Sales for the third quarter of 2022 increased by $14.8 million, or 9.1 per cent, to $178.2 million, primarily due to an increase in store traffic and number of transactions, as customers transitioned back to a “brick and mortar” shopping experience, it said.

RW&CO at Metrotown – Photo by Geetanjali Sharma

Gross profit for the third quarter of 2022 increased $19.8 million to $101.4 million as compared with $81.6 million for the third quarter of 2021. Gross profit as a percentage of sales for the third quarter of 2022 increased to 56.9 per cent from 49.9 per cent for the third quarter of 2021. 

“The increase both in gross profit and as a percentage of sales is primarily attributable to lower markdowns and promotional activity in the third quarter of 2022 combined with a favourable foreign exchange impact on U.S. dollar denominated purchases included in cost of goods sold, partially offset by higher merchandise freight costs as the global shipping industry disruption required an increased usage of air freight shipments to meet customer demand,” said the retailer.

In his letter Stephen Reitman said: “When I reflect upon our experiences over the last 22 months, I am struck by the number of people, both within and outside of our organization, who enabled us to emerge successfully from CCAA, and who have supported us during this most difficult time.

“While the uncertainty of Covid-19 may continue, I am confident that Reitmans (Canada) Limited and our brands, Reitmans, Penningtons and RW&CO., will flourish. I look to the future with hope and optimism for us all, our partners and our valued customers.”

Grocery Shelves in Canada are Alright Despite the Fearful Narrative: Sylvain Charlebois

Metro on Front Street in Downtown Toronto (Image: Dustin Fuhs)

In many parts of the country, Canadians are now reporting a growing number of empty grocery store shelves. It’s happening here, in the United States, and in many other parts of the industrialized world; it’s not just a Canadian phenomenon.

Before Omicron, empty shelves were already visible, but few noticed. They were sporadic in the fall as supply chain woes continued, and our food industry was essentially experiencing supply chain fatigue. After many months of dealing with public health protocols, labour issues, and higher input costs (which tends to create more tension across the supply chain), something had to give.

But due to its viral viciousness, Omicron just made matters worse. Most food companies, from farm to store, have been operating with 20 to 30 percent fewer people available to handle the work. And most of the time, the labour involves perishable goods. For many farmers, processors and retailers, waiting is just not an option.

The storyline for January 2022 at the grocery store is not the same as it was in March 2020. Far from it. Most concerningly, supply chain issues are the driving factor behind food shortages and rising costs—not consumer demand. Shortages of both toilet paper and food were the result of consumer panic coupled with a collapsing food service industry. This time around, supply chain challenges are Omicron, the winter weather, and (of course) public health measures at the border, which may have compromised its fluidity.

Nevertheless, while Omicron was a “gut punch” to the food industry, vaccine mandates for truckers are robbing the industry of the oxygen it desperately needs right now.

Canadians are likely underappreciating how the border is so critical to North America’s food security. Whether you are for or against global trade, Canada has an unforgiving northern climate, along with a moderate population size living in one of the world’s largest geographic areas. Unless a sector builds a significant competitive advantage, and some have, it is difficult to produce food in Canada while keeping affordability for consumers in check. The vaccine mandate disqualified anywhere between 8,000 to 16,000 Canadian truckers from crossing the border; on the American side, about 125,000 drivers. With such a high absence of people, food access will undoubtedly become an issue.

Additionally, if food continues to cross the border, and it probably will, expect that food to be more costly. To motivate truckers to cover the Canadian market will likely come at a price. Reports suggest that getting a truck to cover the Canadian market is 25% more expensive compared to just a few days ago. Higher logistical costs, like anything else involving the supply chain, will catch up to consumers. That’s the reality of supply chain economics. And with fewer people driving around, major buyers will be prioritized over smaller ones. Many processors will have a harder time getting the ingredients they need to manufacturer the food we buy every day, on both sides of the border.

With food distribution, short-sighted government interference can generate market failures, more disruptions and, yes, more empty shelves at the grocery store.

However, the food industry has been able to deal with a lot over the past several decades. The pandemic has been nothing if not challenging, but it has continued to execute and deliver the goods, despite some government-level lack of forethought. The regulatory environment has always been a pain for the food industry, and always will be. The pandemic is no different. Canadians should not underestimate how resilient our food industry is. Consumers may not always find what they want at times, but they will always find what they need at the grocery store. This is due to the work and effort of companies, and people willing to deal with whatever is thrown at them.

Now, a trucker convoy against vaccine mandates at the border has raised almost $800,000. The convoy will continue into next week. It blames news outlets for the collective “COVID-19 hysteria”, as it’s called. Truckers have every right to protest, but transporting goods is what we need them to do. The convoy itself is not likely to make much of a difference.

Meanwhile, Canadian consumers should know they will be fine. Operations across the supply chain are incredibly choppy right now, but they will continue to find what they need, albeit with fewer choices. Some of the choppiness is policy-induced, but it is what it is. Still, expecting perfection at the grocery store for the next little while would be unreasonable.

Canadian Shopping Centres Have Among the Highest Occupancy Rates in the World: Cadillac Fairview VP

CF Pacific Centre (Image: Cadillac Fairview)

Canadian shopping centres have among the highest occupancy rates in the world, says the Vice President of Retail Leasing for Cadillac Fairview.

Darryl Schmidt

In a recent webinar with the Consumer Real Estate Canada group, Darryl Schmidt said in the UK vacancy levels are sitting around 30 per cent in some very large well-established shopping centres.

“Likewise in the US, so where our portfolio and the Canadian average is probably sitting somewhere between 85 and 92 per cent occupied. We’re in really good place. But excess vacancy and large box vacancy, there’s a number of huge department store boxes that are vacant in the US and Europe, is forcing those landlords to get super creative,” said Schmidt.

“There’s a big push in Europe and the US into the leisure category. I saw some concepts where you had indoor go kart tracks, full indoor go kart tracks, EV, electric so they’re super high speed, within department store space and then all the ancillary leisure uses that would go along with that in terms of indoor golf . . . There seems to be a huge movement afoot to try and fill the void of these large boxes with leisure.

CF Chinook Centre (Image: Cadillac Fairview)

“I don’t know if that’s going to be a long-term solution. It’s a great short-term traffic driver.”

Schmidt said he was pleasantly surprised at how robust retail sales in Canada were in the third and fourth quarters of 2021 once the industry emerged from a lot of the lockdowns earlier in the year.

“We’re getting good initial feedback from a number of our clients in terms of what holiday sales looked like. I would say that in almost 50 per cent of our portfolio amongst our retailers we saw a return to 2019 sales levels or exceeded 2019 sales levels, especially Q4 and a portion of Q3. So that’s a great news story,” said Schmidt.

“It’s not all great news. We’ve still got some issues in our urban assets because of the lack of return to office in the major markets. I’d say right now given what we’ve seen in the last two years it’s a positive news story certainly for the last six months.”

CF Sherway Gardens (Image: Cadillac Fairview)

Schmidt said luxury retail has performed exceedingly well through COVID.

“When the going gets tough, the tough go shopping. We take a look at Holt Renfrew in Vancouver, they’re exceeding 2019 sales. They didn’t miss a beat. Same with Louis Vuitton. Tiffany. Any of the luxury brands performed exceptionally well and we’re seeing the byproduct of that now. We’ve got a number of luxury brands in market that are looking to expand. Some of it is re-trenching out of the department stores and looking for freestanding locations. Others it’s just expanding their footprints on the global standpoint and doing new freestanding locations,” he said.

But Schmidt said there remains some real systemic weakness in footfall in the major urban markets. The Cadillac Fairview portfolio includes CF Pacific Centre in downtown Vancouver, CF Rideau Centre in downtown Ottawa and the downtown Toronto CF Eaton Centre. 

“In those markets, we’re only seeing a maximum return to office occupancy in our towers of about 20 per cent and that’s having negative impacts on footfall. In best case scenarios on the weekend we’re seeing footfall return to 50 per cent of pre-pandemic levels. Mid-week it’s probably weaker. It’s somewhere between 35 and 40 per cent. And that’s a challenge. It’s a huge challenge for our food operators in that diminished footfall. They live and die on the number of people coming through the shopping centres,” said Schmidt.

CF Rideau Centre (Image: Cadillac Fairview)

“That’s still an issue for us but the good news side of that is we’ve seen disproportionately high sales for the footfall. In a number of retailers in those urban assets we’ve seen retail sales return to 80-85 per cent of pre-pandemic levels with that light of traffic.

“Conversely in the suburban markets, our fortress type suburban shopping centres have gone back up to 80-85 per cent footfall pre-pandemic. CF Chinook Centre being an example. CF Carrefour Laval being a good example. And we’ve seen sales to my earlier point exceed 2019 sales basically since August. So, higher conversion rate for the footfall that we’re seeing. Very intentional shopping. A sign of the times. Nobody’s going out to the shopping centre unless they’re intending to spend money. That’s kind of the silver lining.”

Schmidt said there is no question there is a trend toward having auto dealerships in malls these days. He said Cadillac Fairview likes the trend because it’s a category that appeals to a male shopper. Schmidt said CF is putting the finishing touches on a Mazda deal in CF Richmond Centre which is backed by Mazda in Japan. It has also replaced one of its largest boxes in CF Markville with a Porsche dealership.

Schmidt said another retail category trend athleisure is “red, red hot.”

Image: JD Sports

“We’ve done five deals with JD Sports out of the UK and we’ve opened the first one in CF Fairview Mall in Toronto. They’re performing exceptionally well. We’re going to have a number of the openings through the spring of this year,” he explained. 

“We’ve done a number of deals with Decathlon out of Europe, a large sporting goods chain. And they’re going to be quite aggressive. But also we’ve signed up new business with NIKE, Athleta. We’ve got other yoga players from Australia, US and Central Europe looking.

“And we’ve got other footwear players looking. So athleisure is far and away the hottest category and it’s good. For the first time in probably 25 years in our corporate history we’ve got some larger blocks of real estate that we can accommodate these players.”

Schmidt said Peloton’s space at CF Chinook Centre will be tripling its footprint at the mall, which is another example of how the fitness and health category will grow in the future and more of a blurring of fashion and fitness.

Schmidt said Cadillac Fairview is looking to diversify both its asset class and geographically by investing in Central Europe, the UK, Latin America and Asia.

TESLA at CF Sherway Gardens (Image: Cadillac Fairview)
Live at CF Richmond Centre (Rendering: SHAPE Properties)

“We’re unweighting of retail and office right now, trying to weight more heavily into residential, mixed-use and logistics,” he said.

There’s a big push to differentiate the company’s existing portfolio and assets from their competitors and much of that will be through mixed-use developments on a lot of existing shopping centre sites,” said Schmidt.

“A good example of that is what we’re doing in Richmond with CF Richmond Centre where we’ve got the entitlements in place and we’re under construction on 12 towers that’s going to represent 2,000 condominium units that will be developed out over the next seven years. And we’ve already pre-sold 1,000 units in the last 14 months in that market.”

Podcast: International Retail Brands That Entered Canada Over 12 Months

International Retail Brands That Entered Canada Over 12 Months

This week Craig and Lee talk about the new international retail brands that entered Canada over the course of 2021. Included is an analysis as well as a projection for 2022.

The Weekly podcast by Retail Insider Canada is available on Apple Podcasts, Stitcher, TuneIn, Google Play, or through our dedicated RSS feed for Overcast and other podcast players. Also check out our The Interview Series podcast where Craig interviews guests from across the Canadian retail landscape as part of the The Retail Insider Podcast Network.

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Drop us a line at Craig@Retail-Insider.com. You can also rate us in Apple Podcasts or recommend us in Overcast to help more people discover the show!

Background Music Credit: Hard Boiled Kevin MacLeod (incompetech.com). Licensed under Creative Commons: By Attribution 3.0 License. http://creativecommons.org/licenses/by/3.0/

Unique Second-Hand Retailer Opens Inside of Hudson’s Bay Store [Interview/Photos]

Surplus Market at CF Polo Park (Image: Surplus Market)

Andrew Sannie, Anthony Sannie and Kyle Goldstine discovered the thrift/vintage culture in Japan and that has led to the launching of the unique retail shop Surplus Market in Winnipeg at Hudson’s Bay CF Polo Park.

Anthony Sannie

“We discovered the excitement of thrift shopping in Tokyo, Japan three years ago. That trip was one of the motivators to come back home and create an event around the culture of thrifting and vintage shopping,” said Anthony Sannie.

“Thrifting is such a large cultural component in Japan, so we were definitely influenced on that trip. We wanted to share these experiences with our customers. When you come into our store, everything is curated, categorized, and merchandised, like you would see in Japanese vintage stores. “

Surplus Market at CF Polo Park (Image: Surplus Market)

The trio has been working on the concept of Surplus Market since 2019 and in October opened their first shop in shop inside Hudson’s Bay at the popular Winnipeg shopping centre, featuring vintage and upcycled apparel and offering high-touch services including a café powered by Never Better Coffee – the first independent coffee shop in the mall.

Surplus Market is a vintage and contemporary retail brand selling rare vintage and independent contemporary apparel, accessories, and homegoods – with an eye toward sustainable fashion and technology. After starting as a series of experience-driven events, the Winnipeg-based company launched its first experiential retail boutique, in collaboration with Hudson’s Bay. The curated store carries its own unique array of goods, while featuring select local vendors, many of whom sold at previous events. The first location, at CF Polo Park, also features a café with a pour-over coffee bar, and food and music pop-ups.

Originally, the Surplus Market operated as a periodic event, offering consumers a chance to buy rare and limited second-hand pieces like clothing, housewares, and even vinyl. The events buzzed with appearances from an array of food vendors, freshly squeezed juice and cocktail bars, record shops, visual artists and DJs.

Anthony Sannie said Surplus Market was originally a vintage resale event that was hosted at the downtown Hudson’s Bay location which started in 2019.

“We held a few events at that location and then we were obviously met by COVID, we got locked down, couldn’t do any other events and then shortly after that, a few months after March of 2020, the regional team at Hudson’s Bay contacted us to see if we were interested in collaborating on a physical store in store at the Polo Park location and we already had ideas of turning Surplus Market into a physical store anyways,” he said.

“We brought that idea to their team. They were very keen on it. So we started building out this concept.

“It’s an experiential clothing store that focuses on sustainability because we’re a resale vintage store. So 95 per cent of the things that come in are one of a kind. They’re one-off things that you can’t get any other place. It’s all vintage, it’s all second hand. There’s also an experiential component to the store too. We have lots of pop up events, we connect with the community, we’ll host artists, DJs, local makers. We really try to engage with our community in different creative ways.”

Andrew Sannie

Andrew Sannie, Co-Founder of Surplus Market and Grape Labs, which is an incubator behind the retail concept, said sustainability in retail needs to be prioritized by big box stores, “so we’re thrilled that Hudson’s Bay sees the value in what we are doing here. It shows that they’re thinking about the same things we are.”

Kyle Goldstine

“It’s just the beginning. Based on all the data out there, we predict a tectonic shift in retail when it comes to consumption, and a gradual shift toward sustainability, resulting in major growth in the second-hand retail industry,” said Kyle Goldstine, Co-Founder of Surplus Market and Grape Labs.

Anthony Sannie said the vision for the company is to expand into more than one retail space with Hudson’s Bay in Canada and potentially overseas.

“We’re kind of leaving that up for discussion and that possibility open. We’re hoping to expand and obviously stay at our current location at the Hudson’s Bay in Polo Park as well,” he said.

The company has also launched its e-commerce business. Two of the owners are black and one is a member of the LGBT community.

“It’s a diverse group of people leading this project,” said Anthony Sannie.

Canadian Retail News From Around The Web For January 20th, 2022

Canadian Retail News From Around The Web

News at a Glance

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.

A ‘Perfect Storm’ for Criminal Activity: US-Style Smash-and-Grab Retail Crime Expected for Canada [Feature]

A ‘Perfect Storm’ for Criminal Activity: US-Style Smash-and-Grab Retail Crime Expected for Canada [Feature] (Image: Anadolu Agency/Getty Images)

The COVID-19 global pandemic has been responsible for the spawning, or acceleration, of a number of different trends since the onset and spread of the virus. It’s influenced a more digitally-savvy consumer, sparked a reimagination of the service and experience retailers provide and introduced a new way of working for many. In short, it’s changed, at least in some small way, just about every aspect of the retail operation, forcing an evolution in the way things are done and a financial reconfiguration of the retail balance sheet. For loss prevention professionals, the new retail landscape and expanding ecosystem changes their jobs substantially, presenting them with a host of new challenges and threats to consider and address. Not least of these potential threats, according to industry expert and President of retail consultancy Bottom Line Matters, Stephen O’Keefe, are incidents of smash-and-grab style attacks against retail locations similar to those that are occurring with frequency in California. And, they are incidents that he warns will inevitably occur north of the border as a result of a ‘perfect storm’ for criminals operating across the country. 

“There are a few factors that have been contributing for some time toward the creation of a scenario that’s ideal for the type of criminal activity that they’re currently experiencing on the West Coast of the United States,” he asserts. “Reductions to law enforcement budgets and the number of active police officers in provinces and cities across the country has been a growing issue over the course of the past decade or so. It’s a serious problem on its own for a number of different reasons. However, when you combine that fact with a Canadian legal system that’s reluctant to tie up the courts with crimes that they often consider petty, in favour of more serious crimes, then you’ve got a system that isn’t addressing these threats against the industry. And, because there is an understanding that nothing will be done to prosecute retail crimes like shoplifting and theft, most retailers have instituted ‘no stop’ policies in order to avoid violent incidents that put the health and safety of their employees at risk. The result is a scenario which presents criminals with very little risk and plenty of potential reward, and retailers everywhere with a serious dilemma.”

Copycats in Canada?

O’Keefe also points to unfortunate economic conditions that have been brought about by the pandemic as another layer of influence adding to the complexities of the ‘perfect storm’, rendering certain areas of the country more susceptible to crime. South of the border, San Francisco is an example of one such place that’s been blighted by smash-and-grab crimes against retail locations. The trend began some time ago shortly after the onset of the pandemic with a handful of isolated incidents that seemed to fly somewhat under the radar without catching the attention of law enforcement. However, it wasn’t long before the crime trend spread throughout the city, growing to involve multiple individuals in organized groups and planned attacks against retailers. Many of these attacks have targeted high-end luxury retailers with perpetrators leveraging tools and weapons like hammers to smash glass display cases in order to grab items like jewelry and other valuable merchandise. It’s an alarming situation, and one that O’Keefe believes should serve as a warning of sorts to retailers operating in Canada.

“Circumstances in San Francisco, and now other parts of California, have gone from bad to worse,” he says. “It’s concerning for everyone involved. It’s led many retailers in the affected areas to barricade their premises and for local law enforcement to increase their presence within the city’s retail districts. However, what’s perhaps most worrying is the fact that there have been copycat incidents cropping up across the United States in urban markets like Minneapolis, Chicago, Nashville, and elsewhere, by groups that are leveraging the same methods and behaviours to commit their crimes as those that originated in San Francisco. Because of this factor, these crimes are catching the attention of quite a few retailers in Canada. They’re starting to ask whether or not these types of crimes will migrate north of the border. And the short answer is: yes, they absolutely will, unless the threat is dealt with appropriately by retailers and law enforcement.”

Developing appropriate response

It’s a situation that O’Keefe explains has been made that much more difficult to accurately understand and address as a result of a lack of reporting on the part of retailers. In both the United States and Canada, he says, industry players often refrain from doing so to law enforcement because retail crime, incidents of shoplifting in particular, do not receive adequate attention from the legal system. Non-reporting lends to the creation of inaccurate data that skews perception and undermines the seriousness of the crimes being committed. And, with the smash-and-grab trend sweeping across the United States, O’Keefe says that there are considerable concerns mounting here at home with respect to the ways in which the threat of these types of crimes can be properly dealt with.

“There are a number of retailers in Canada that are looking at these incidents in the United States and trying to figure out how they can remove that target from their stores,” he says. “And this is when the theory of crime displacement is often considered when attempting to determine the appropriate way in which to respond to the threat. For instance, in most traditional cases, cameras have been used as a critical tool in helping to curb shoplifting. The idea is that if someone wants to steal without being identified, cameras will significantly mitigate the risk of theft. However, the criminals committing these smash-and-grabs in the U.S. are masked. And, given that we’re living through COVID-19, a time when everyone needs to be wearing a mask for public health reasons, the cameras do little to remove the threat of these crimes being committed. Because of this, retailers are being advised to respond to these incidents by backing off and calling 9-1-1. There are many within the industry who aren’t satisfied with this advice and have been left feeling as though their hands are tied behind their backs.”

The power of loss prevention management systems

Retail Loss Prevention

Although barricading a storefront seems completely unreasonable, and in-store cameras will not serve to prevent these types of crimes against retailers, O’Keefe suggests that there are ways in which merchants can safeguard their stores, merchandise and employees. By properly maintaining and adhering to their loss prevention management systems, they can more accurately detect trends like these smash-and-grabs and help the business determine the tools and measures that need to be in place in order to effectively address the situation. In fact, according to the veteran loss prevention expert, it may just be the most important aspect of the retail business when it comes to quelling the effects of the ‘perfect storm’.

“For retailers that have made the decision not to arrest shoplifters stealing from their stores, they need to do what they can in order to make themselves softer targets to criminals. And, to do this most effectively, they’ve got to rely heavily on their loss prevention management systems – the underlying foundation of the company that allows everything to operate optimally and safely. It’s a system that assists retailers in understanding the strategies and methods that are required in order to appropriately address the crimes that are being committed. It allows them to develop and sustain a logical thought process to guide and direct decision-making. It helps in identifying technologies that can be implemented to mitigate and, in some cases, eliminate the threat of theft altogether, including smash-and-grab incidents. And, until law enforcement and the Canadian courts treat these incidents of crime with the seriousness that they deserve, it will likely serve as the most significant mechanism at retailers’ disposal, preparing them and equipping them to take the matter of retail crime into their own hands.”

Related Retail Insider Articles

Leger Study Ranks In-Store Experience at Ontario Retailers: Interview

LUSH
PHOTO: LUSH

For consumers, the in-store experience has become increasingly more important in how they decide where to shop and spend their dollars.

This year’s WOW Study, by Leger, surveyed 13,000 Ontarians about their in-store experience at 153 retailers across 20 different sectors. 

The top retailers for best in-store experience in 2021 were:

  1. Lush
  2. Saje Natural Wellness
  3. Purdys Chocolatier
  4. Nespresso
  5. Lee Valley Tools
  6. Yves Rocher
  7. M&M Food Market
  8. Ren’s Pets
  9. Lego

Christian Bourque, Executive Vice President and Senior Partner at Leger, said the theory and science behind customer experience is still evolving. 

Christian Bourque

“It used to be that we believed as market researchers if you as a customer are satisfied you will come back. We were only aiming to jump this high for satisfied customers. But very soon we figured out that being satisfied is not a predictor of loyalty, of coming back, of recommending the store, of making something out of your brand that was bigger than what it actually was. So that’s where people said you can’t only make people just be satisfied with their experience,” said Bourque.

“In order to predict the future behaviour of people, you need to go one step beyond. That’s where customer experience came in and people said you need to look at how people experience your store. You need to deliver above and beyond just making them satisfied. You need to have the proper visuals, colours, smells, sounds that basically appeal to your target audience. So that’s where the whole customer experience became very popular probably 10 or 15 years ago. 

“Now we’re slowly moving into a new sphere which they call the human experience to what extent people are relating to what’s in the store, relating to the brand. The brand corresponds to what they want and need in terms of quality of life that suits their lifestyle but also their values, beliefs and their fundamental needs. We believe we’ll be going beyond customer experience and now into human experience moving forward.”

THE 2021 RANKING OF THE BEST IN-STORE EXPERIENCES IN ONTARIO

The WOW study also looked at the drivers of a sense of belonging: a person has a sense of belonging when they identify with a store and embrace its values, mission, actions and the image it conveys. A strong sense of belonging gives the impression of belonging to an organization, being part of its community, supporting it and contributing to its development. A sense of belonging is also associated with a strong emotional connection and translates into commitment, said Leger.

“This dimension of the in-store customer experience has the greatest impact on recommending a retailer across all sectors. There is also a very strong correlation between a sense of belonging and the WOW Index. The top retailers in this year’s ranking all scored well on this dimension compared to other players in their sector,” said the report. 

“An excellent way for a retailer to create a sense of belonging is to positively contribute to its customers’ quality of life. Retailers can adopt strategies to reduce stress, make customers happy, offer flexibility, be available, etc. Remedy’sRx, Kiehl’s, Nova Cannabis and Saje Natural Wellness are examples of retailers that stand out on this driver. Corresponding to its customers’ values and beliefs (production methods, packaging, product type, etc.) is also an important driver of a sense of belonging. Zero-waste retailers, those with responsible packaging and those in the eco-friendly and organic universe, such as Lush, Yves Rocher and MAC stand out on this driver.

“Having happy, committed employees who are passionate about their work also contributes to creating a strong sense of belonging: Lululemon, Lego and Lee Valley Tools perform very well on this driver. The sectors with the highest sense of belonging are beauty, cannabis, men’s clothing, pharmacy and specialty boutiques.”

The WOW Digital Study also evaluated the online customer experience in Canada of 184 Canadian websites and apps on 22 dimensions, allowing companies to identify their strengths and weaknesses at each stage of the online shopping experience, from online shopping to delivery.

THE 2021 RANKING OF THE BEST ONLINE EXPERIENCES IN CANADA

In 2021, the companies that offered the best online customer experience in Canada are:

  1. Lufa Farms
  2. Lush
  3. Simons
  4. DAVIDsTEA
  5. Nespresso
  6. SAQ
  7. Jack & Jones
  8. Lee Valley Tools
  9. Apple Store
  10. Sephora

In the overall study, Leger also identified the Most-Appreciated Mobile Apps.

“The Simons mobile app tops the ranking of the apps Canadians appreciate most. It stands out with respect to several aspects: its visual appeal, the personalization of the customer experience and the presence of interesting additional content. CIBC’s app, ranked second, is especially appreciated for its usability and the relevance of the features it offers,” said the report.

“Finally, the SAQ app, which came in 3rd place, is appreciated for its discounts and promotions, its visual appeal, the relevance of its functionalities and the level of personalization of the customer experience.

Desjardins is in 4th place in the ranking of the mobile apps most appreciated by Canadians, while Tangerine, Brunet, Lush and Nespresso are all tied in 5th place. Finally, Chocolats Favoris came in 9th place, and Amazon Canada came in 10th.”

IKEA Partnership Launching One of the Largest Zero Emission Vehicle Fleets in Canada for Deliveries: Interview

IKEA Partnership Launching one of the Largest Zero Emission Vehicle Fleets in Canada for Deliveries: Interview

GoBolt, formerly Bolt Logistics, is partnering with IKEA Canada to deploy one of Canada’s largest zero emission vehicle fleets.

The company said the deployment accelerates GoBolt’s mission to be carbon negative by 2023 and IKEA Canada’s goal to reach 100 per cent zero-emission deliveries by 2025.

GoBolt, a leading Canadian technology-enabled ecommerce fulfillment and last-mile delivery provider, will deploy 30 electric vehicles (EVs) across the country in 2022 in partnership with leading global home furnishing retailer IKEA Canada. It marks one of Canada’s largest zero-emissions, medium-duty vehicle distributions for commercial deliveries to date.

IKEA Canada 2021 Report
Mark Ang

“GoBolt is committed to being a planet positive business. We’re demonstrating this commitment through our laser focus on becoming a carbon-negative logistics company by the end of 2023. This involves making a conscious investment to help ensure we can provide a zero-emission, carbon-negative last-mile delivery solution, while funding carbon sequestering initiatives around the globe” said Mark Ang, CEO of GoBolt. “We are thrilled to be working with IKEA Canada on this initiative and look forward to continuing to collaborate on building smarter and greener supply chains.”

GoBolt’s first zero emission delivery trucks have officially hit the road earlier this year, with 29 to follow across British Columbia, Quebec and Ontario this year.

Melissa Barbosa

“With transportation being one of the largest contributors of the global climate crisis, IKEA Canada is committed to eradicating carbon emissions and electrifying its last-mile delivery service, utilizing the benefits of electric vehicles to further transform the market,” said Melissa Barbosa, Head of Sustainability at IKEA Canada. “The value-add of deploying zero emission vehicles accelerates our goal of becoming more accessible, affordable, and sustainable for our customer network.

“We have some lofty ambitions, a positive strategy. One of those ambitions as an organization is to be 100 per cent circular and climate positive by 2030. Within that ambition we have a subset of goals and zero-emission delivery and services by 2025 is one of those goals. So globally we are as an organization all trying to achieve this goal of zero-emission transport by 2025 and GoBolt has been one of our trusted partners. Their values are very aligned with ours.”

Ang said the company, based in Toronto, started in 2017 as a storage company that would pick up, store and return consumer items. People would go to the website, fill in a simple request for what they wanted stored and then the company, called Second Closet, would show up at a date and time they had selected to pick their things up and bring them back to storage.

Image: GoBolt

“We took a big step back. We wanted to try and drive a little bit more direct value as a business versus this dormant space. Storage is obviously pretty sleepy and it wasn’t really in line with what we wanted to be when we grew up,” he said.

“The good news is that we really built a supply chain network for big and bulky product. We had warehouses, people, technology, and processes built around handling big and awkward things that were already pre-built and needed to be protected and brought to storage and so to store and deliver them to customers with a white glove level of service and connect our facilities with technology to orchestrate was in the realm of possibility and we were already doing it in a small way.

“So what GoBolt has become is a B2B complex logistics and delivery company where we store products – pick and pack sort of facilities and then conduct a final mile with our truck fleet. We rebranded from Second Closet to GoBolt as a show that we were now a 100 per cent B2B business. The name GoBolt comes from a desire to be quick at what we do because lightning strikes fast but also electrify our entire final mile.”

Ang said GoBolt originally started speaking with IKEA about ways it could support their business back in 2019.

Image: IKEA & GoBolt (Formerly Known as Bolt Logistics and before that, Second Closet)

“As it so happened, it was a pretty normal time. There was no COVID and everything was just kind of running business as usual. We got to a point where we started to integrate with them and really align culturally that we wanted to both be positive businesses and if we could find a way to work together that would be really nice synergy to drive our electrification goals forward faster,” said Ang.

“Then COVD struck and we were in a position where we could start supporting them immediately. So the working relationship started then and our planning and implementation behind the scenes around EV continued to increase in velocity. That’s how the relationship started. We started off with one location in Toronto and now we support properties in Toronto, Montreal, Ottawa and Vancouver. This is going to help us expand our electrification footprint to all those four markets in Canada.”

Ang said GoBolt’s aspiration is to help light the fire in innovation in the logistics space. It wants to move the market toward more electrification.

“We think that the more that companies can leverage electrification the better all of the infrastructure become, the better the vehicles become the more cash flow these OEM (Original Equipment Manufacturer) to drive more R&D to build additional versions of a previous, the better infrastructure becomes utilities get more equipped and better prepared to actually support the overnight lows to support these swaths of vehicles,” said Ang.

“That’s what we want the future to look like . . .  It’s going to be a consumer demand that businesses are conscious about their carbon footprint. And logistics takes up a massive amount of companies’ carbon footprints. I think this is one of the obvious areas to focus on.”

IKEA Canada is part of Ingka Group which operates 389 IKEA stores in 32 countries, including 14 in Canada. Last year, IKEA Canada welcomed 31 million visitors to its stores and 117 million visitors to IKEA.ca.