By Randy Harris, President, Trendex
Canadian luxury apparel retailers during 2020 continued in some cases to open new stores and/or upgrade their existing ones. However as many are aware, last year was a disastrous period for Canadian luxury apparel retailing.
Bain and Co. reported that, worldwide, luxury apparel retail sales during 2020 decreased 30%. In Canada during 2020, the picture was almost as bleak. Some numbers to consider:
- Apparel sales in total decreased 23.6%.
- Men’s dress apparel sales fell 33%, while women’s dress apparel sales decreased 35.3%.
- Total non-U.S. tourist visits to Canada decreased 85.6%. Tourist visits from China, Hong Kong and Japan decreased. respectively by 87%, 82% and 87% which had a significant impact on luxury spending.
- Luxury retail store closures, especially in Ontario, reduced store traffic and sales.
- The number of Canadian individuals with a net worth between US$5 and US$30 million decreased by 4.0% vs. increasing by 7.9% in the U.S.
Canadian Luxury Apparel Sales Significantly Decline In 2020
While Canadian luxury apparel e-commerce sales more than doubled last year, or in the case of Harry Rosen grew by more than three times, the increase was not nearly enough to offset the decrease in luxury apparel brick and mortar sales. Trendex, using the before mentioned inputs, along with additional information, estimates that Canadian luxury apparel sales decreased 27.9% in 2020 to C$2.14 billion. Luxury apparel sales will certainly increase in 2021, however it is too early to forecast the segment’s growth.
Despite the slow growth, luxury brands continue to enter the Canadian market according to Retail Insider. This summer in Toronto’s Bloor-Yorkville area, Italian menswear brand Isaia will open in July at 77 Yorkville Avenue and Miami-based The Webster will open nearby on Scollard street. At Yorkdale, iconic brand Celine will open soon alongside a row of luxury stores not seen elsewhere in Canada, in addition to the confirmation that Alexander McQueen will be opening its first Canadian stand-alone storefront nearby. In Vancouver, there has been a slowdown due to a substantial reduction in Chinese visitors though leasing activity is expected to pick up with Mario Negris and Martin Moriarty recently moving to brokerage Marcus & Millichap.
For more information on Trendex reports, visit: www.trendexna.com