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Lightspeed Launches New Features to Drive Digital Transformation of Retail SMBs

By
Retail Insider
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Global commerce company Lightspeed has announced new digital features to help SMBs navigate a new retail landscape permanently altered by COVID-19.

The Montreal-based company is supporting its customers with the continued digital transformation of their businesses with new tools that offer increased mobility when processing transactions, more options for viewing business insights, and will better support SMBs as they continue to adjust to consumer behaviour.

In the coming weeks, Lightspeed will introduce business-empowering features for in-store POS and eCommerce, including Mobile Tap supporting curbside pick-up and contactless payment, Digital Wallet, and Analytics Core.

“Our priority as we look to the future of retail is to enable our customers to adapt quickly to the dramatic and rapid changes in consumer behaviour over the past few months,” said Dax Dasilva, Founder and CEO of Lightspeed. “The SMBs that Lightspeed powers are innovating quickly because they are equipped with tools that help them remain agile, stay connected with their customers, and future-proof their businesses.”

The digital overhaul forced by COVID-19 has become the new normal, with consumer trends showing that eCommerce will remain crucial as SMBs adopt tactics to elevate the digital experience for their customers. Lightspeed’s new solutions enhance the omnichannel shopping experience, enable greater multi-location efficiencies, and offer opportunities for improved productivity for Lightspeed retailers.

Mobile Tap for Curbside Pick-Up and Contactless Payment

Lightspeed merchants in the U.S. using Lightspeed Payments will now be able to process transactions with just a tap, anywhere in-store or curbside, offering greater flexibility in situations of social distancing. The Mobile Tap hardware connects through Bluetooth, essentially turning an iPad into a contactless mobile payments terminal. Payments are processed securely with the integration of end-to-end encryption technology.

Digital Wallet for eCommerce

Optimized for mobile, the introduction of Digital Wallet in North America supports faster eCommerce conversion and supports a plethora of payment methods globally, including Google Pay and Apple Pay. With 21% of U.S. eCommerce shoppers abandoning their cart at checkout due to a lengthy or complicated process, this secure and seamless one-click eCommerce checkout experience is part of the answer to improved conversion online.

Analytics Core for Retail Insights

Through this new module, users will have access to a variety of business dashboards and insights on sales, inventory and employee performance, enabling retailers to make data-driven decisions about the future. Analytics Core will be released globally and is the perfect entry point to Lightspeed’s existing retail analytics suite.

While it was integral for retailers to have an online presence during pandemic shutdowns, it has become clear that their digital presence and strategies will remain crucial. Retailers who utilize these tactics, combined with a deep understanding of their customers will come out ahead.

Lightspeed continues to share industry knowledge through an online resource guide that serves to protect SMBs during the pandemic.

For more information, please visit: www.lightspeedhq.com

On social media: Linkedin, Facebook, Instagram, YouTube, and Twitter

*Partner content. To work with Retail Insider, email: craig@retail-insider.com

Oxford Properties Announces Southcentre Mall Sears Box Redevelopment in Calgary

By
Mario Toneguzzi
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EXTERIOR OF SOUTHCENTRE MALL ENTRANCE

Calgary’s Southcentre Mall is moving forward with the redevelopment of the massive vacant retail space formerly occupied by Sears and adding at least five new tenants and potentially more to the shopping centre’s mix.

Total redevelopment will be 235,000 square feet and be completed by 2022, but the project will be kickstarted by the first phase which includes close to 100,000 square feet to house new retailers PetSmart, Winners, and Dollarama on the first floor of the shopping centre space. The overall project covers three levels and the upper floors will likely be home in the future to bigger format retailers.

“We are the first shopping centre in Calgary to redevelop retail space of this scale in recent years,” said Jason Bos, General Manager at Southcentre Mall. “We strive to introduce retailers that serve our community’s needs and wants. These three new retailers deliver on this goal and reinforce Southcentre’s reputation as an important, local shopping centre with strong community connections.”

Sears closed its stores in Canada in January 2018. Since then, there had been some specialty leasing activity in the Sears space at Southcentre with a furniture retailer, Showhome Furniture, for about a year while the shopping centre was working through the preliminary phases of the redevelopment process.

MAP OF SOUTHCENTRE MALL

“Once the redevelopment process got to a point where we needed to hand it over to the construction team to start swinging hammers we had to vacate (the space) again so that they could get the space ready. That was done last May, and it’s basically been under construction since then,” said Bos.

The first phase of the redevelopment includes Dollarama, which is set to open this fall and PetSmart and Winners which are scheduled to open in Spring 2021. Future phases will include additional retailers and businesses on the upper two floors.

Bos said in today’s world it is almost impossible for a shopping centre to lease that amount of space to one large anchor.

“That type of format — department store format — doesn’t really exist in terms of new construction, new build, in the industry anymore. It’s prudent to take the course we’re taking in terms of breaking that up into some smaller units,” he said.

“Generally speaking, we found at other Oxford Properties where Target’s have been redeveloped and similar things have been done, it’s a net positive. People in general aren’t shopping at the department store type retail as much as they used to be. While Hudson’s Bay is certainly still a draw and certainly still brings in a significant amount of traffic something like a Sears the traffic had been decreasing for some time. Going in this direction we expect to see significantly higher footfall once things have stabilized and we’ve got the entire project open.”

IMAGE OF SOUTHCENTRE ADVERTISEMENT REVEALING NEW RETAILERS
INTERIOR OF SOUTHCENTRE MALL AND ITS ADVERTISEMENTS REVEALING NEW RETAILERS

At one point over the last few years, there was talk that La Maison Simons could have been a tenant for that empty Sears space.

“We had had conversations with Simons at a certain point in time but nothing had ever been finalized,” said Bos.

Including the Sears box, Southcentre Mall is just over one million square feet and home to over 160 stores, including Aritzia, Sephora, H&M, lululemon, CRAFT Beer Market, and Calgary exclusives like Crate & Barrel, Restoration Hardware, and Western Canada’s first Sporting Life.

“The redevelopment of this real estate was designed to complement and diversify Southcentre’s existing retail mix,” said Bradley Jones, Head of Retail at Oxford Properties, which owns and manages Southcentre. “We aim to connect people to exceptional places; Southcentre is a best-in-class shopping centre that will continue to serve the community’s needs at large.”

Southcentre said that the opening of the first three new retailers is expected to create more than 150 permanent jobs as well as more than 200 jobs during the construction phase.

“I think this is a great thing for the shopping centre,” said Bos. “It will really reinforce our position as a community destination where we can connect people and build exceptional places and experiences for them.”

Coworking and Flexible Work Spaces Expanding in Suburban Malls in Canada

By
Mario Toneguzzi
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EXTERIOR OF LAUFT COWORKING SPACE. PHOTO: LAUFT

Flexible work and coworking spaces have become an increasingly popular trend in today’s world, with accelerated growth expected due to the COVID-19 pandemic.

FLEXIBLE COWORKING SPACES TO SEE GROWTH DUE TO COVID-19

And companies that have unique and innovative workspaces are taking advantage of that scenario.

“We’re definitely in growth mode and actively looking at locations in other shopping malls to extend our network of flexible workspace,” said Graham Wong, Founder/CEO of LAUFT.

“For individuals and organizations with the freedom to work remote, we provide the tools and services for them to do their best work in the most convenient, consistent, and professional way possible. We locate LAUFT wherever people need to work so our global vision has us setting up in shopping malls, store-in-store (ex. coffee shops, bookstores, etc.), hotels, conference centres, hospitals (when safe), and locations that allow people to work closer to where life happens.

“Pre and Post COVID the demand has been increasing rapidly as remote work has become the norm for many companies. We’re excited to roll out to serve and support remote work everywhere.”

LAUFT opened December 2018 in Upper Canada Mall in Newmarket. Other current GTA locations include: Barrie (Georgian Mall), Vaughan (Vaughan Mills), Toronto (Metro Centre), and Burlington (Burlington Centre). There are also locations in Ottawa and Kingston.

INTERIOR OF LAUFT COWORKING SPACE. PHOTO: LAUFT

The expansion plan includes more locations in Toronto (401/Dufferin + Yonde/Wellesley), Mississauga, Oakville, Oshawa, Scarborough, and other locations around the GTA.

Wong said the platform is mobile and technology driven. People can rent a desk, an office, a meeting room or even a boardroom by the hour.

“It’s very much like Uber. You open the app, you find the closest LAUFT and you can book. You don’t have to call ahead, you don’t have to have a membership or contract,” said Wong, adding that coworking in general in places like Regus, We Work, and Staples is still a very traditional office model for companies.

“We want to solidify the GTA model and then build out across Canada and into the U.S. It’s a global vision to really have LAUFT on almost every street corner so that if you need to work you open that app and find the closest one, you get to work.

“We’ve created the utilitarian aspect of flexible work, put it into a convenient package, a network of touchpoints and we’ve made it totally customizable so that you book by the hour, the day, the week and it’s up to you.

“We’re aggressively looking at shopping malls. We’re looking across the board to really build up the model in southern Ontario right now. Once we’ve proved that model we also are going to be locating LAUFTs in airports, hotels, conference centres and hospitals when they are able to. We’ll roll this out across the country, into the U.S. and eventually go global. We want to take flexible work and put it on every corner. That’s our goal.”

Robert Martellacci, Founder & CEO of MindShare Workspace Inc., Canada’s first mall located coworking innovation space in Erin Mills Town Centre in Mississauga, said the concept is for shared office space for small businesses and startups.

“We are looking to expand our format into other suburban area malls,” he said.

“I had this vision four years ago when we started evolving the concept and that was kind of ahead of my time but now all of a sudden now the expansion opportunities, in combination with COVID and store spaces opening up, it’s a great opportunity to expand.”

The Erin Mills Town Centre space is about 4,000 square feet, a former Urban Planet store. There are nine offices, dedicated desks, and drop in space. It accommodates 40 to 50 businesses.

“I want to make it really super simple and easy to access our space,” said Martellacci. “People really value the amenities of the mall. The food court. The free parking. We’re solving the problem for the malls. I see a shift happening to more services in the future with the recent closures. It presents opportunities.

“We’re looking at other locations. We’re definitely looking at U.S. expansion and we’re looking at expansion into other suburban malls that are a key region like the GTA. We’re interested in Calgary. We’re looking at major metropolitan areas in suburban regions because people are re-evaluating priorities in life. People are looking to stay closer to home. People are starting their own businesses because of COVID. Growth is definitely on the horizon.”

“We’re in discussions with Milton. The Town of Milton is the fastest growing town in Canada and over 3,000 people travel downtown daily on the GO. That’s likely going to be our next location. There’s no coworking space there and there’s a mall that’s being renovated.”

A mall conglomerate in Upper State New York to Boston with 16 locations has also expressed interest in the concept.

Mobile Klinik Professional Smartphone Repair Plans Major Expansion Post-TELUS Acquisition

By
Mario Toneguzzi
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MOBILE KLINIK LOCATION AT PARK ROYAL, WEST VANCOUVER

Mobile Klinik Professional Smartphone Repair, Canada’s largest and fastest growing while-you-wait smartphone and tablet repair, care, sales, and services retailer, expects its growth to accelerate after it was recently acquired by telecommunications giant TELUS.

MOBILE KLINIK IS THRIVING IN THE WAKE OF TELUS ACQUISITION

The Mobile Klinik chain currently has 83 stores in major shopping malls, select Walmart stores, and other high-traffic retail locations across the country. The chain is located in eight provinces. In September, a location will open in the Halifax Shopping Centre and it’s currently negotiating a deal for Charlottetown in Prince Edward Island.

It will continue to operate as an independent business division of TELUS, after the deal was closed on July 1.

Tim McGuire, CEO of Mobile Klinik, said the intent is to use the greater financial and human resources of TELUS to allow Mobile Klinik to “accelerate our already crazy fast-pace of expansion across Canada”.

“Our goal is to get to 200 plus stores across Canada to ensure we can be in virtually every community. Certainly every community of probably 30,000 or more in population. And to get there as quickly as we can so we can help all of our partners — whether that’s the device makers like Samsung and Apple or the carriers or the insurance companies that provide the extended warranty coverage for those customers,” said McGuire.

“We want to be able to provide them with a nationwide network of consistent, professional service in every market and therefore the faster we grow the faster we can deliver that service everywhere in Canada and the TELUS deal will help us accelerate and get there a year or two earlier.”

MOBILE KLINIK LOCATION INSIDE WALMART IN OAKVILLE, ON

The Mobile Klinik brand, store look, strategy, and management team remain the same.

“The only thing frankly that changes in the strategy is the pace. And where we would have planned to do 30 or 40 stores by next year, we’ll probably do 50 or 60 stores instead. We’ll get to our national coverage plan a year or two earlier than we otherwise would,” said McGuire.

“Our goal is to serve as the utility for the industry. We’re the one player in every mall, the one player in every community, that all carriers, all customers, all partners can rely on and that doesn’t change in any way.”

MOBILE KLINIK WILL CONTINUE ITS PARTNERSHIP WITH WALMART

McGuire said the company will continue to partner with Walmart stores in Canada by opening locations in the mega retailer.

Mobile Klinik has six locations in Walmarts. Two recent ones were added in Milton and Oakville in Ontario. Another one is expected to open in Niagara Falls before the end of the year.

“In communities where there is not an effective enclosed mall or where we need additional store support beyond what traditional malls provide we want to go to the next biggest centre of retail activity and in most markets that’s the one big outdoor mall that has Walmart, Costco, Canadian Tire, and Cineplex,” said McGuire. “We normally would have gone to those locations and rented a store space in the mall, along with other small retailers, but given the traffic advantages and the partnership with Walmart locating inside their stores in those communities is an even more effective way to get to the place where people shop.

 

 
 
 
 
 
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Hey Oakville! We’re now open inside your @walmartcanada Supercentre! Fix your phone fast - no appointments necessary, any carrier, any device. We’re here to help!

A post shared by Mobile Klinik (@mobileklinik) on

“I wouldn’t be surprised if we ended up with 30 or 40 Walmart locations over the next few years.”

In addition to Mobile Klinik’s core repair business, the TELUS deal will help it dramatically accelerate its certified pre-owned phone business as well in Canada because it will have access to all of the phones that TELUS customers trade in as they upgrade to new phones and new plans.

“This means a significant expansion in our ability to buy phones, refurbish those phones and re-sell them through our network and continue to make operating a cell phone more affordable for every Canadian by giving them lower cost phone options as well as our repair instead of replace options,” said McGuire.

“Particularly in these challenging economic times when people are relying on their devices more than ever to stay connected since it’s more difficult to connect in person, we believe that through the combination of our professional repair services at great value and the ability to provide lower cost devices to folks that want a certified pre-owned rather than a new device it can really help keep telephone costs affordable for Canadians across the country.”

Sterling Road Landlord Offers Extended Rent Relief to Artist Tenants in Toronto

By
Mario Toneguzzi
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ONE AKIN ARTIST SHOWCASES HER WORK AT AUTO BLDG. PHOTO: BIANCA ROCO

Toronto developer Castlepoint Numa is providing rent relief for a group of artists in its unique Auto BLDG to help the tenants survive and get through the COVID-19 pandemic.

THE CASTLEPOINT NUMA RENT RELIEF WILL ALLOW AKIN ARTISTS TO CONTINUE TO WORK AMID COVID-19

The rent relief, which takes effect immediately, is increasing and extending support measures for Akin, Canada’s largest artist-run provider of shared studio space, to maintain the artist studio program for three years with rent-controlled relief. This commitment will allow over 20 artists per year to continue to work and flourish at the Auto BLDG, located at 158 Sterling Road.

In addition, Akin will launch a new series of free and pay-what-you-can community programs which will include open studio events, artist talks, family workshops, plus more when gathering restrictions are lifted.

“When the Auto BLDG at 158 Sterling Road opened its doors in 2018, Castlepoint Numa made a commitment to foster and support the creative community and during the COVID-19 crisis we are upping that commitment. Now more than ever, practising artists need support and places to create,” said Harley Valentine, Vice-President of Castlepoint Numa. “Akin is at the heart of the emerging artist community and we support their vision.”

Measures include a 75 percent reduction in monthly rent for the next three years from September 1 on and for rent that has already been paid during the period of March 1 to September 1, a credit has been applied to future months.

EXTERIOR OF AUTO BLDG IN TORONTO. PHOTO: BIANCA ROCO
CLICK FOR INTERACTIVE MAP OF 158 STERLING ROAD, TORONTO.

The 10-storey building is about 100,000 square feet and is a landmark building in Toronto being more than 100 years old. Valentine said the building is one of the first iterations of a concrete slab construction in Ontario. It was originally built by Alcan in 1919 for the manufacturing of aluminum.

“What’s unique about this landmark building is each of the 10 floors is addressed separately. We’ve got a retail tenant which is the Museum of Contemporary Art. They’ve got a cafe amenity on the first floor and bookstore and they occupy the first three floors of the building,” said Valentine. “Then we have our artist studio program which happens on the fourth floor. And on the fifth floor to the 10th floor, we’ve got a mix of high-end office.”

THE AKIN STUDIO PROGRAM WILL CONTINUE TO THRIVE AT THE AUTO BLDG THANKS TO RENT RELIEF PROGRAMS

The Auto BLDG is a heritage designated building in the City of Toronto. This landmark building was used as an aluminum foundry and manufacturing plant until its closure in 2006. Castlepoint Numa led the restoration and adaptive reuse of the Auto BLDG and today continues to be at the heart of the emerging mixed-use neighbourhood. The restored building opened its doors in 2018 and is currently home to a number of organizations in the creative sector, including Junction 59, Zeidler Architects, Fusion FX, Pride Toronto, Akin and Museum of Contemporary Art Toronto.

“We are all thrilled that the Akin Studio Program can continue on in a new iteration at the Auto BLDG at 158 Sterling Road thanks to the support of Castlepoint Numa,” said Oliver Pauk and Michael Vickers of Akin, in a statement. “This special program is a unique opportunity for artists, curators, and writers to have shared studio space in the building and be immersed within a community of peers. The support also allows us to engage the public through special events.”

In the Auto BLDG, 20 artists each have about 200 square feet of fixed studio space for 12 months.

“There’s various practices of painting and sculpture and textile and fashion design,” said Valentine.

“We’re offering a 75 percent reduction in rent for them and the 25 percent that they do pay over the course of COVID, we’ll re-issue that as a credit towards future community programming. Further we’re fixing their rent for the next three years at a below market rate.

“What’s unique about Akin, and it’s really been a focus of our group’s efforts, is these working artists have been hit hardest and in the neighbourhood that we exist in the lower Junction in the west end of Toronto there’s always been a strong history of makers and artist studios. And we want to double down on our participation and continuance of that tradition.

“What’s unique about this building, and we really pride ourselves on it, is the tenant mix and the ecosystem we’ve been able to cultivate. One of the reasons we’ve attracted the likes of Zeidler Architects and some of these other cutting-edge tech companies is that we support that diversity and we don’t want to turn our backs on what’s been able to set us apart in the retail and commercial market. And we’ve been known for it. I think during this downturn the successes property owners have been able to ride I think they’re in jeopardy of potentially losing that by losing some of the fundamental and principal defining qualities of their building. So it’s something we’re very cognizant of.”

Castlepoint Numa has also offered support and modified lease agreements to Toronto Biennial of Art, allowing them to continue to work uninterrupted as they plan for the next Toronto Biennial in 2021.

Valentine said Castlepoint Numa acquired the brownfield site in 2001 and has spent the last 20 years remediating, cleaning the site and rejuvenating the 100,000-square-foot office building top to bottom.

“Basically outfitting it to be a state-of-the-art, modern office building. Sandblasting every inch of concrete and re-delivering it as a landmark to a future master-planned development. And this will be forever sort of the heart of that neighbourhood.”

Concerns Among Retailers as Canada Emergency Commercial Rent Assistance Program Ends this Week

By
Mario Toneguzzi
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BUSINESS OWNER CALCULATING BUSINESS COSTS

The Canada Emergency Commercial Rent Assistance program is scheduled to come to an end on Friday and groups across Canada are urging the federal government to continue the initiative but to also improve it so it can help more small businesses struggling to survive through the COVID-19 pandemic.

RENT RELIEF REMAINS CRITICAL FOR CANADIAN SMALL BUSINESSES AS CECRA COMES TO AN END

According to the Canadian Federation of Independent Business, a survey indicates one in three small businesses say rent relief remains a critical missing piece for their recovery.

“Three months into the launch of the program, it is now abundantly clear that while CECRA has helped some, it has left many more stranded without relief. How is it fair that the dry cleaner on one side of the street will survive because their landlord is using CECRA and the one on the other side will go under because they can’t access the program? Another problem is the bar to access the program is extraordinarily high even with a willing landlord,” said Laura Jones, Executive Vice-President at CFIB.

“We need provincial finance ministers to help Ottawa fix this, now. Waiting to see if more landlords apply for CECRA by the application deadline would be a big mistake not in keeping with sensible recovery plans. Rent relief needs an overhaul now to ensure a successful economic recovery for the small business community.”

The CFIB said federal government records show that less than 10 percent of the funding committed to CECRA has been spent to help 29,000 small business tenants. An additional 25,000 applications are predicted before the submission deadline at the end of August (program ends in July, but applications are open until the end of August), which still leaves the program underutilized.

CFIB IS ENCOURAGING PROVINCIAL GOVERNMENTS TO WORK WITH THE FEDERAL GOVERNMENT TO AID SMALL BUSINESSES AMID COVID-19

The CFIB is recommending provincial governments work with the federal government to allow tenants to directly apply for and access CECRA funding. CFIB has also recommended the forgivable portion of the Canada Emergency Business Account be expanded as an alternative way to provide rent relief.

In an open letter to Canada’s Finance Ministers, the CFIB said there is an urgent need to fix rent relief for small business owners across Canada.

“On behalf of the businesses that have been left out of a program that can make or break their future, we are urging you to fix this by repurposing the money left in the CECRA budget to get help directly to tenants. One in three businesses say rent relief remains a critical missing piece for their recovery—a failure to address this would represent a serious failure in any economic recovery plan,” said the letter.

“Rent relief needs an overhaul now. Ideally, provincial and federal finance ministers should work together to fix CECRA by establishing an alternative way to get rent relief money directly to tenants who need it. However, if this is not possible to do quickly, CFIB urges provincial governments to immediately pull their portion of CECRA funding and redirect those funds to directly support small business tenants that have not been able to access the program. This pivot to assist local businesses that have been denied access to rent relief is critical to economic recovery.”

David Lefebvre, Restaurants Canada Vice President, Federal and Quebec, said CECRA has been beneficial for some restaurants who were able to access that support over the past few months.

“For those participating in the program, this could make the difference between being viable and being able to remain open and having to close,” he said.

“At this point from the conversations we’ve had with the government it seems right now the only possibility is an extension. There’s no indication in the short term that there will be major changes to the program but they’ve been open to extending it for a few more months like they did with the wage subsidy. But in the wage subsidy you had some positive changes in the program.

“Also at this point being in the middle of the summer, there’s not a lot of movement in terms of the government.”

The main thing Restaurants Canada has been asking from the beginning is for the program to be better for tenants, explained Lefebrve.

“Right now the landlord has a veto right to enter or not to enter into an agreement under the CECRA program. This is definitely a problem. We’d like to have something like if a tenant fulfills some kind of checklist they could force an agreement on the landlords under the program,” he said. “This is something we’d like to see – some way to make it compulsory for landlords to participate in the program.

“We’d also like to see applications to be more streamlined and easier to do for operators.”

RETAIL COUNCIL OF CANADA SAYS CECRA IS TOO COMPLICATED

The Retail Council of Canada said CECRA is too complicated, too restrictive with the threshold for revenue loss for tenants too high at 70 percent, and it is voluntary, requiring landlords to apply on behalf of tenants which it appears was not successful based on the lack of pick up.

“There’s been a challenge with the program from the get-go with respect to landlord participation,” said Karl Littler, Senior Vice President, Public Affairs at the Retail Council of Canada. “The program is a weird one which is if you benefit from it, it’s a godsend right. And if you do not benefit from it, it’s utterly useless to you.”

Another issue with CECRA is that only small business tenants paying less than $50,000 per month in gross rent in a given location are eligible which leaves out many bigger retailers.

Jon Shell, Managing Director & Partner of Social Capital Partners in Toronto, and Co-Founder of Save Small Business, a grassroots coalition of small businesses across Canada, said the CECRA program doesn’t really do very much.

“Not very many people use it. I think for the very few businesses that have it you might as well extend it. It doesn’t cost very much money. So why not?,” said Shell.

“They don’t have any alternatives that they’ve proposed. I think not extending it is nonsense but even extending is not that important. It’s super important for the very few companies that get it but so few companies get it. It’s had almost no impact. We’d like it to be replaced with something useful.

“The government announced $3 billion for rent relief. I’m assuming that the reason they did that is because they thought rent relief was important and the $3 billion was the right amount of money to provide to small business in order to pay the rent. They have spent a fraction of that money. So the question is do they still believe that rent is important and if so what’s the plan with all the money. Our suggestion is creating a simpler mechanism to deliver that money directly to tenants as opposed to going through the landlords.”

Retail E-Commerce Explodes in Canada Amid COVID-19 Pandemic

By
Mario Toneguzzi
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ONLINE SHOPPERS USING ECOMMERCE PLATFORM WHILE INSIDER BRICK AND MORTAR STORE

Retail e-commerce sales reached a record $3.9 billion in May in Canada, a 2.3 percent increase over April, and a 99.3 percent increase over February ($2.0 billion), according to Statistics Canada.

Year over year, e-commerce sales more than doubled—with a 110.8 percent increase compared with May 2019.

THE EXPLOSION OF ECOMMERCE HAS THE POTENTIAL TO RESTRUCTURE THE CANADIAN RETAIL INDUSTRY

The federal agency said small businesses are increasingly turning to e-commerce platforms and are using these platforms in innovative ways. The degree to which Canadians continue to choose e-commerce purchasing options or return to traditional purchasing methods has the potential to change the structure of the retail trade industry in Canada. Clearly, the retail landscape will evolve, it said.

“These record gains in e-commerce occurred as total retail sales experienced record declines. The impact of COVID-19 is best highlighted using April data. Retail sales plummeted to $33.9 billion in April, a 29.1 percent decline from February and a 26.4 percent decline from April 2019. While e-commerce saw a 63.8 percent monthly increase in April, in-store sales dropped 25.3 percent. In May, total retail sales started to recover, reaching $39.3 billion,” said the federal agency.

“Retail e-commerce sales have risen steadily, with the proportion of online sales rising from 2.4 percent in 2016 to 4.0 percent in 2019. The month of April highlights the peak of the COVID-19 impact, with the proportion of retail e-commerce sales jumping from 3.8 percent in April 2019 to a record high of 11.4 percent in April 2020. In May, as the Canadian retail environment allowed for more in-store purchases, the proportion of retail e-commerce sales was 10.0 percent.”

The report said e-commerce sales increased more among non-essential retailers. All 11 retail trade subsectors with e-commerce sales saw an increase in online sales as a result of COVID-19. From February to April 2020, only the food and beverage subsector experienced an increase in in-store sales (+3.3 percent) and a surge in e-commerce (+107.0 percent).

StatsCan said In-store sales declined for general merchandise stores (-15.1 percent), building material and garden equipment and supplies dealers (-15.8 percent), and health and personal care stores (-16.1 percent). These subsectors had relatively moderate declines compared with other brick-and-mortar operations, it said.

“In contrast, other retail trade subsectors — such as furniture and home furnishings stores (-69.6 percent); sporting goods, hobby, book, and music stores (-79.0 percent); and clothing and clothing accessories stores (-84.2 percent) — saw much sharper declines in in-store sales from February to April 2020. As in-store sales decreased for these subsectors, e-commerce sales increased.

“Mandated business closures that prevented retailers from making traditional in-store sales resulted in a greater shift toward e-commerce. Meanwhile, food and beverage stores — essential services that were allowed to remain open — saw a 38 percent increase in grocery sales in the second week of March compared with 2019, and a surge in sales of certain personal care products.”

EXPERT BELIEVES THAT BRICK AND MORTAR WILL STILL APPEAL TO CUSTOMERS AS ‘NEW NORMAL’ SETTLES

Michael Kehoe, broker/owner of Fairfield Commercial Real Estate in Calgary, said the mandated business closures that prevented retailers from making traditional in-store sales over most of the past five months was a black swan event.

“The spike in retail e-commerce sales over this period is no surprise but there is a robust return to customer visits to physical stores that will likely lead to similar customer footfall levels over the medium term that were seen before the COVID-19 pandemic,” said Kehoe, a veteran of the consumer real estate industry with 45 years of experience.

“Small businesses in the retail sector have increased their e-commerce platforms but as things normalize across the country retailers will rely on their bricks and mortar locations that are essential to any omni-channel retailing strategy. Retailers are the heart and soul of the country we have realized during the pandemic. Shopping will normalize over time as Canadians return to their favourite venues.”

COVID-19 HAS ACCELERATED DIGITAL FULFILLMENT IN THE CANADIAN RETAIL INDUSTRY

Gary Newbury, a retail supply chain strategist and serial transformation executive, said the impacts of COVID-19 for Canadian retailing prompted full attention to digital fulfillment, especially for those non-essential retailers who were forced to close, but also for those in essential businesses as they deployed “in store” fulfillment models.

The figures at 10 percent do not show the potential. This potential is split between three key factors, he said:

  1. Canadian’s propensity to order abroad having their items imported (which are not tracked by Stats Canada);
  2. How retailers choose to report their online sales, there are some classification challenges; and
  3. The lost opportunity for many retailers to “shine” during this time with a combination of curbside and home delivery services to help drive brand loyalty during a period of extreme uncertainty for many consumers.

“The significant uptick in volume of online order fulfillment is an important trend. It also is a time for reflection for retailers who were often forced to ‘get their digital side of their business up and running’, to attempt to scale their services from a standing start, or were, frankly, in their element as they had already been operating at volume and welcomed the extra demand, especially if their stores were closed to consumers,” said Newbury.

“Given many consumers are fearful or, at best, reluctant to “get back to normal” with their shopping habits, it begs the question, will the recent rise in online sales continue to grow?

“My thoughts are that there are many factors that relate at category, brand and consumer level. I believe there will be a massive flight to value during this year and early next and uncertainty will prevail for 18-24 months. This seismic demand movement will tend to mean there is no prospect of profit for many retailers looking to operate an online business. Only those making significant investments now will likely be in good shape to buck this trend. Those still looking at eComm as a bolt on to their store distribution network will run into all manner of problems and will conclude the best way forward will be to close the online store.”

He said retailers are starting to rethink their merchandising approaches and are looking to have more clear propositions both in store and online, often by removing proliferating SKU (stock keeping unit) assortments and going back to basics.

At the end of the day, whether the percentage online will grow, stabilize, or reduce will be as a result of consumer perceptions of value, how quickly they want to acquire products and the relative friction they experience between channels (store and online), much of which is in the retailers hands to manage, he added.

“Many people experienced online services for the first time over the last four months, some had a great experience, some not so great. If somewhere in the order of 50 percent of people would prefer to avoid retail stores (lots of friction currently), this is a big prize for retailers to go after, however, they need to approach this opportunity with care, ensure they elicit the help of digital fulfillment experts, be open to look at digital retailing in a different way (skip the extended aisles and pricing mechanisms etc), and ensure they fully comprehend the financials of online if they are going to develop a profitable online business,” said Newbury.

Bruce Winder, author of RETAIL Before, During & After COVID-19 and President of Bruce Winder Retail, said the Statistics Canada report confirms what many people hypothesized: as brick and mortar retail softened in many cases, e-commerce sales soared during the key months of the pandemic (thus far).

“The multi-million-dollar question is what will e-commerce sales look like from now until a potential vaccine is developed and administered and what will e-commerce sales look like post vaccine,” he said.

“One can argue that the growth in e-commerce during wave one of the pandemic allowed consumers to sample the convenience, safety and endless aisle of online shopping - leading to a permanent uptick in this channel. Sadly, we will probably see wave two sometime soon which will reinforce online shopping's benefits.

“An important point however, is to recognize that existing e-commerce infrastructure is lacking as witnessed by countless order delays, missing products and charging errors during wave one. As we have already seen from Walmart and Empire, retailers (and suppliers) have begun to pivot to quickly increase online shopping and delivery capacity to meet anticipated needs.”

STORE COUNTS WILL DIMINISH BUT BRICK AND MORTAR WILL PREVAIL

This will have, as we have already seen, retailers reviewing store counts and closing unproductive locations that have been pushed into the red. There will be fewer stores from many legacy brands as a result, added Winder.

“New digitally native brands will emerge though and have the benefit of building brick and mortar infrastructure based on this evolving environment. They will integrate all channels so that the shopping experience involves less friction than today's incumbents,” he said.

“The tough part for retailers is learning how to make money on e-commerce sales - especially if they don't sell their own brand. Even with the required scale, technology and partner infrastructure, it won't be easy and net profit margins could be considerably less than traditional brick and mortar channels that have been refined for decades. Will suppliers help pay for this gap as per Walmart's announcement to add new discounts to vendors last week?

“Nevertheless, this is a transition that must happen as the customer is demanding it. Those that can make the successful jump to profitable e-commerce will survive, those that cannot will be swept away as online retailers like Amazon, who have been readying for this day for decades, will dominate."

National Swimwear Retailer ‘Swimco’ Files for Creditor Protection: CEO Interview

By
Mario Toneguzzi
-
SWIMCO STORE AT SQUARE ONE SHOPPING CENTRE. PHOTO: SWIMCO

Long-time Calgary-based retailer Swimco, a national swimwear company, has filed a Notice of Intention, under creditor’s protection, to restructure its operations as it responds to the devastating impact of the COVID-19 pandemic.

Lori Bacon, Owner and CEO of the retailer which opened its first retail store in Calgary in 1983, said the NOI gives the company up to 90 days to put a proposal together for the creditors.

“Here’s how we see our business. Here’s what we’re doing for leasing expenses, for staffing, for everything and provide them with a business plan of how we think we can be viable, profitable into the future,” she said.

PHOTO OF LORI BACON STANDING IN FRONT OF TWO WOMEN MODELLING SWIMCO.

“And also a payment plan for the amounts owing them. And they vote on that. Hopefully they see that there’s a way forward together and we carry on. We’re hopeful that by the end of September that we are through this process and have launched our Swimco version 2.0.

“We’re looking to be a smaller company. We’re at 20 (stores) and we envision staying there.”

Pre-COVID it had 25 stores in operation.

Bacon confirmed that the company has about $6.5 million in unsecured claims and that includes about $1.6 million in landlord rent.

Swimco reduced its head office by about half. The company had 45 staff in its corporate head office but now that has been reduced to about 20. Retail staff was at about 200 and today is sitting at about 120.

“Integral to this plan is renegotiations with landlords and getting our rent expenses in line with where we see sales will be for the next few years because they are going to be dramatically different,” explained Bacon.

The five stores to be closed include three in Ontario, one in Vancouver where a lease has not been renewed, and one other store is currently in lease negotiations.

Bacon said the COVID crisis came around spring break which meant no travel for people.

“With all stores being shut and still having your rent looming over you, you go in the hole pretty quick. At first, I think everyone was just in a state of shock. ‘For two weeks we’re going to close.’ But it readily became apparent that this was not a two-week thing. We laid everybody off temporarily. We closed the stores on Monday March 16 and we quickly laid off all our store people and most of our head office people and by the following week we had laid off everybody,” she said.

“And really you know, I have to give credit to my husband Dave who for lack of nothing to do he kept coming into the office and the only one in the building and then his financial assistant joined him and they just started modelling things. Like sort of what if, what if, what if. I needed some convincing that there was a way forward and we’ve been working with some retail advisors . . . just modelling things and then realizing that this was an option for us to file a Notice of Intention to restructure. It was our opportunity to get out of some leases that were prior to COVID not profitable and certainly wouldn’t be during COVID.

“It just allows us to stop for a moment, put something in front of our creditors and we’ve had such positive support from both our bank and our vendors. They want this to work and I’ve become convinced that we do have a way forward and that our relative small size gives us a lot of nimbleness in terms of product offering and how we operate. We’ve done this throughout our 45 years but this time it’s much faster. The required moving into another lane. The adjusting. The evolving. It’s just got to happen fast. That’s what we’re prepared to do and that’s what we’re working on. We’re fighting for it and holding hands with our vendors and our landlords and think we can get there and be profitable next year and then ahead where we really see things opening up which is in 2022.”

Swimco actually had its roots as a home-based, mail-order business started by Bacon’s mother Corinne Forseth a few years before the retailer opened its first location.

Dyson to Open 3rd Canadian Retail Space in Calgary

By
Craig Patterson
-
CF CHINOOK CENTRE. PHOTO SUPPLIED BY DYSON

UK-based household and technology ‘reinvention’ brand Dyson will open its third standalone Canadian location at Calgary’s CF Chinook Centre in September. It follows Dyson’s first Canadian showroom that opened in Toronto in late 2017, as well as a Vancouver location that opened in January 2020.

THE DYSON DEMO STORE IS SET TO OPEN AT CF CHINOOK CENTRE IN SEPTEMBER

The Calgary ‘Dyson Demo’ store will showcase the brand’s latest technology courtesy of a trained team of employees, while also providing visitors the opportunity to purchase various Dyson products. On display will be products such as supersonic hairdryers, air purifiers, commercial hand dryers, and various vacuum models. The store will sell LED lights which were created by Jake Dyson, son of company founder Sir James Dyson. Amid COVID-19, the air purifiers may be a draw — the Calgary storefront will showcase Dyson’s  full range of air treatment products including the Dyson Pure Hot+Cool, which launched in January 2019. It’s essentially an air purifying fan and heater that detects particulate matter and gasses with intelligent sensing and then automatically captures them so they are removed from the air.

Construction hoarding went up last week for the new Calgary Dyson Demo store, which will be located on the main floor of CF Chinook Centre across from the entrance to the mall’s Saks Fifth Avenue location and one storefront away from the mall’s highly productive Louis Vuitton store. The Calgary Dyson space measures about 2,340 square feet according to lease plans supplied by landlord Cadillac Fairview. 

CF CHINOOK CENTRE DYSON LOCATION HIGHLIGHTED IN RED. CLICK IMAGE FOR INTERACTIVE MALL FLOOR PLAN
EXTERIOR OF DYSON STORE. IMAGE: DYSON

The first Dyson Demo store in Canada opened at Toronto’s Yorkdale Shopping Centre in December of 2017, spanning about 2,000 square feet. The Vancouver location is about 2,500 square feet in a prime location at CF Pacific Centre and was open briefly before the COVID-19 store shutdowns. Sources say that there has been interest in a location at West Edmonton Mall in Edmonton and possibly in downtown Montreal. 

Dyson’s first store in the world opened in Tokyo in the spring of 2015, followed by locations in Paris, Moscow, Jakarta, and London. More have since opened in major centres globally. The United States is home to four Dyson Demo stores in New York City, San Francisco, suburban Washington DC, and most recently a location opened at Westfield Century City in Los Angeles.

THE DYSON DEMO MODEL COULD BE ADOPTED BY OTHER RETAILERS DUE TO COVID-19

The Dyson Demo store model could be one that more retailers utilize as chains downsize amid crippling rent payments. With one location per city, Dyson’s presence allows for a local ‘foot on the ground’ while creating legitimacy, education and brand awareness for the region. While visitors to a Dyson Demo location may not make a purchase in the retail space itself, a subsequent purchase online or in a wholesale retailer is another possibility. Dyson’s wholesale distribution in Canada is extensive. Many major retailers across the country carry Dyson products, including Canadian Tire, Best Buy, Hudson’s Bay, Bed Bath & Beyond, Walmart, Costco, Leon’s, The Brick, Lowe’s, and others. 

Last-Mile Delivery Most Inefficient Part of Retail Supply Chain in Canada: Experts

By
Mario Toneguzzi
-

Last-mile delivery is the most inefficient process for more than half of North American Transportation & Logistics companies, says a new global report commissioned by SOTI in partnership with Arlington Research.

STAKES HAVE NEVER BEEN HIGHER FOR TRANSPORTATION AND LOGISTICS COMPANIES AS CONSUMER HABITS SHIFT

In an era where e-commerce is exploding and consumers are expecting rapid, often same-day deliveries, the report titled The Last Mile Sprint: State of Mobility in Transportation and Logistics, said 78 percent of companies in Canada in Transportation & Logistics say last-mile delivery is the most inefficient process of the entire supply chain. In comparison, 59 percent of those companies in the U.S. felt that way.

“The stakes have never been higher for transportation and logistics companies in North America as consumers increasingly embrace a delivery culture,” said Shash Anand, Vice President of Product Strategy, SOTI, the world’s most trusted provider of mobile and IoT management solutions, with more than 17,000 enterprise customers and millions of devices managed worldwide.

“By implementing a robust mobile-first strategy, companies will not only be able to provide better customer experiences, but will increase speed, minimize costs, ensure transparency in the delivery channel for the customer and end consumer, and edge out the competition.

“Ensuring your technology is constantly updated and having an integrated mobility and IoT management platform in place is an effective operations strategy that helps minimize disruptions to your business and maintain high levels of customer satisfaction.”

Companies such as ShipperBee have launched in an Uber-like way, though ShipperBee is currently operating in the Greater Toronto Area only though it has plans to expand.

Gary Newbury, a retail supply chain strategist and serial transformation executive, said he agreed with the survey’s main point; the last-mile delivery is the most inefficient process in the retail supply chain. And Canadians tended to be much more aware of the gaps.

“The volume of online versus total retail in Canada has historically been below five percent (up to COVID-19). Much of the approach retailers have taken has been focused on the ‘marketing’ side of the digital business stream. As a result the assumption for many retailers has been ‘it’s just a small change and so we can bolt it onto our existing distribution network’,” he said. “And to a degree, they were able to think this is all they needed to do with relatively low/incidental volumes. Retailers brought in digital marketing experts, but not digital fulfillment experts. To cover for this knowledge gap they tended to either try and ‘skunk work’, a fulfillment process internally (bending process and systems to accommodate), or relied on a third party logistics service to do the heavy lifting, relying on their tech platform for ‘visibility’ of shipping through to the doorstep. Often, the retailer may have found their tech platform was more geared towards B2B tracking, rather than B2C.

“Approaching a key future line of revenue in this ad hoc way has exposed many retailers to an unprofitable business stream, and as they attempted to scale this, the losses just got worse, the customer service often suffered, through lack of transparency of where their order was in the fulfillment process. For many consumers, up to COVID-19, it has been a hit and miss process.

“The reason why I think they got this wrong is retailers’ distribution networks are designed to move mass merchandising from Point A (a supplier) to Point B (a store) via a distribution centre. Typically, the lowest unit that is shipped in this way is a case. Online is very different, it is all about individual pieces, and often a localized mixed, being ordered electronically, with an expectation of speed, to either the store (for pick up) or to a point of convenience (such as a residential address).”

COVID—19 HAS EXPOSED THE RETAILERS WHO WERE SLEEPING ON INITIATIVES SUCH AS CLICK AND COLLECT

Newbury said, “the eComm supply chain design, for many retailers, needs a deep rethink. COVID-19 has exposed many retailers — missing the boat by not having a click and collect or home delivery service, or having services which did not scale, and where they did, caused the retailer to lose more money than staying shut”.

“It is the most labour intensive and resource consumptive part of their proposition, but rather than just have small cube, high margin products online with a scheduled service for their delivery (and restricted geographical coverage), many retailers, being under-informed about the cost profile of fulfillment of online orders, unfortunately followed the trend of other retailers and felt it was something they had to do to keep their proposition competitive,” he said.

“The rethink is to look at the stores as potential inventory distribution points, consider automation, and, currently, look into using Micro Fulfillment Centre methodology. This is not the end game, but it’s a start to bring control and predictability to the outrageous costs of manual picking in the DC and the costs of shipping lots of small individually packed orders across Canada, of often low margin products.

“The rethink must return to a re-evaluation of the retailing proposition and what is required to be presented in store and that which is presented online. Often retailers, desperate for extra sales extend the online assortment which serves to compound complexity and drive high costs in serving customers.”

Newbury said there are five or six key areas for retailers to address before they can turn a profit on online orders:

  1. Financial record-keeping can hide the end to end costs of fulfilling online orders – when there is a spike in demand, extra costs are surfaced in fulfilling demand;

  2. SKU (Stock Keeping Unit) proliferation – retailers must look carefully at what their overall proposition is and how this is presented “in store” and online. Often online (extended aisles) can cause significant complexity and cost. Consumers are very savvy and, within a click, they can pick off all the low margin items and switch to other retailers (i.e. they will split their baskets to maximize their shopping dollars/value);

  3. High customer acquisition costs compared to life-time value (e.g. Wayfair);

  4. On demand fulfillment versus scheduled fulfillment – the choice of strategy can have a big impact on capacity, customer satisfaction and costs – retailers need to think carefully how best to structure their fulfillment processes to best optimize their proposition;

  5. Free delivery, porch piracy and “hassle free” returns – there’s not such a thing as a free lunch in business, nor is there in the virtual world; and

  6. “I mindfully add a sixth component in the sense that retailers know stores, what they know less of is digital. Approaching online as a bolt on is the worst of all worlds. Using a case/pallet distribution network for singles fulfillment will stop retailers growing online business, profitably. It looks good on paper, but the execution can be seriously profit draining.”

Some other key findings from the SOTI research include:

  • 82 percent of respondents in the U.S. and 88 percent in Canada agreed that it is critical for T&L companies to ensure a mobile-first strategy around last-mile delivery. A mobile-first strategy is defined as viewing smartphones, tablets and task-specific apps as the primary tools for getting work done;

  • Companies know that a mobile-first strategy for last-mile delivery can transform their business operations. 74 percent in the U.S. and 80 percent in Canada agree that their organization would benefit, or have already benefited, from an effective mobile-first strategy for last-mile delivery. 49 percent of respondents in North America with a mobile-first strategy in place for last-mile delivery said that it has effectively reduced their operational costs;

  • In North America, more than half (58 percent) of T&L professionals said a mobile-first strategy has enabled them to gain visibility into critical aspects of their supply chain; and

  • 49 percent of T&L companies globally said their technology is outdated. In Canada, nearly 68 percent of T&L companies indicated their technology is outdated, and 41 percent in the U.S.

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