Vancouver-based multi-brand footwear retailer Ronsons has been placed into receivership amid a lack of cash flow following the closure of its stores amid the COVID-19 pandemic. Other retailers in Canada are expected to follow as ‘non-essential’ stores remain closed for an indefinite period across the country.
“It is with a heavy heart that I have to tell you that due to the COVID-19 pandemic the company is now in receivership,” said Tony Aronson, CEO of Ronsons. He and his father founded the company 32 years ago.
“With the help of our incredible staff, loyal customers, and supplier partners – many of them friends, we grew the business to eighteen locations”.
All 18 of Ronsons’ stores are in British Columbia, including nine full-priced Ronsons locations and nine off-price Ronsons Rack stores. Sixteen of the stores are in the Vancouver/Lower Mainland and two are in other parts of the province. That includes a Ronsons store in Victoria and a Ronsons Rack store in Kelowna.
Most of the stores are located in shopping centres, where rents can be high. While some shopping centre landlords have offered rent deferrals, most are still insisting that rent be paid in the future.
In April of 2014, when Retail Insider was still a new publication, we reported that Ronsons had relocated its downtown Vancouver store from the lower level of CF Pacific Centre to a streetfront location at 734 Granville Street. That store, along with several other Ronsons locations, features a full-priced section at the front as well as an off-price 'Rack' section at the back of the space.
Ronsons stores carry a wide range of brands with a focus on comfortable footwear. That includes brands such as Clarks, ECCO, Hush Puppies, Mephisto, Merrell, New Balance, and others.
In a post on Reddit, some lamented on the loss of Ronsons. Others questioned if Ronsons was already struggling financially. “Their store service was great and they had a great variety of shoes. I also used to work there and it was a good company to work for,” said Reddit user 'Linxlexxi'.
Reddit user 'RampagingKittens' said “This is so upsetting. They're one of the few stores in Canada that reliably carries a wide selection of attractive wide width shoes. Even after I moved away from BC I still ordered from them :(.”
One Reddit user 'Doormatty' asked the question “isn’t that a little fast to be going into receivership for 18 stores”. Reddit user ‘mistervancouver’ noted that zero revenue and high taxes can lead to “quick decisions” (granted Ronsons has an online business as well).
Reddit user 'WhiskerTwitch' said, “I think we're going to lose a lot of Canadian clothing retailers in this, it's already been tough on them (so many chains have been closing), and now with nothing keeping them afloat and rents to pay, this will be the end of many great stores.”
More Canadian retailers are expected to file for creditor projection in the coming weeks as physical stores remain closed across the country. While many businesses may have online stores, web sales are said to be insufficient to keep them afloat. Many consumers in Canada are not buying clothing at the moment, with reasons including ‘stay indoors’ orders as well as job losses and wealth that has been lost due to a declining stock market and oil prices. We’ll continue to follow the Canadian retail industry as companies begin to assess operations.
There are signs of hope that the COVID-19 pandemic’s numbers are beginning to plateau in British Columbia and Alberta, which could signal that stores may be able to open again in a few weeks. The number of cases in Ontario and Quebec continues to increase rapidly, however, and it remains to be seen how long governments will mandate store closures, and if stricter stay-at-home orders may be implemented in some jurisdictions.