Canada Goose, once celebrated as a Canadian luxury apparel success story, is facing increasing scrutiny from industry observers following a disappointing third quarter in fiscal 2025. The company’s results and ongoing strategic decisions have prompted Randy Harris, President of retail consultancy Trendex North America, to state bluntly: “The love affair with Canada Goose is over.”
In an interview, Harris outlined how a series of missteps and overextensions, particularly in direct-to-consumer (DTC) strategy and over-reliance on China, have left the brand vulnerable. While Canada Goose once seemed poised to become a global leader in high-end outerwear, recent financial and operational indicators suggest that its current strategy may be faltering.
Q3 2024: A Mixed Bag With Ominous Undercurrents
In its Q3 2024 earnings report (fiscal quarter ending December 29, 2024), Canada Goose highlighted several initiatives aimed at reinvigorating the brand. Among them:
- The launch of an inaugural capsule collection by designer Haider Ackermann.
- An elevated wholesale shopping experience at Selfridges in London, featuring a Polar Bears International pop-up and dramatic window displays.
- The opening of two new shop-in-shops, bringing the total permanent store count to 74 globally.
However, Harris said these “notable highlights” did little to address more fundamental concerns. “These are distractions,” he said. “They don’t address the core problem, which is a strategy that’s not working.”
What Canada Goose didn’t emphasize in its Q3 communication was even more telling, Harris noted. “They buried the real story,” he said. That story includes:
- A 2.2% drop in total revenue for the quarter and a 1.2% year-to-date (YTD) decline.
- A 1.4% decline in DTC revenue for the quarter and 1.0% YTD.
- A 4.0% decline in Canadian revenue for the quarter and a sharp 16.9% YTD drop.
- A 7.6% drop in Greater China revenue.
- An 8.1% decrease in wholesale revenue for the quarter.
“Too Much, Too Soon”: A Strategy Misaligned with Reality
For Harris, Canada Goose’s shift toward a heavy DTC model is the brand’s most pressing issue.
“They want to be Nike or Levis,” said Harris. “But those companies are selling hundred-dollar items. Canada Goose is selling thousand-dollar coats. That’s not a DTC-friendly product, especially when they lack coverage in key markets like Europe.”
According to Harris, the brand’s retail footprint is too limited to support its DTC ambitions, particularly across the European Union. “They’ve got four stores in the UK and only one in all of France. None in Austria or Norway, where their product would make a lot of sense,” he said.
This lack of physical presence is hurting not only brand exposure but also revenue. “They’re trying to grow direct-to-consumer in markets where they don’t even have a presence,” he added.
Over-Reliance on China Raises Red Flags
Harris pointed to another area of concern: over-dependence on the Chinese market. In Q3, 38% of Canada Goose’s stores were in Mainland China, accounting for 36% of its total revenue.
“That’s just too much risk in one market,” Harris explained. “China’s economy grew by just 5% in 2024, and growth is expected to slow even further in 2025. You don’t build your long-term strategy on an economy whose growth is slowing.”
While the Asia-Pacific region (excluding China) saw a 28.4% sales increase, the performance wasn’t enough to offset broader declines. “Sure, they should celebrate cash increases and inventory reductions,” Harris said, referencing the 15% inventory reduction and 140.3% increase in cash reserves. “But those are band-aids. They don’t fix a flawed business model.”
Wholesale Woes: “They Applied a Hatchet”
One of the more perplexing moves, according to Harris, was the brand’s apparent abandonment of many wholesale partners, including Sporting Life—formerly one of its largest Canadian retail channels.
“They applied a hatchet to their wholesale business,” said Harris. “And they thought they could pick it up with DTC. It didn’t work.”
Wholesale revenue has been on a steep decline: down 8.1% in Q3 2024 and 28.5% in Q3 2023. For fiscal 2024, the company is forecasting a 20% drop in wholesale revenue overall.
“This is not sustainable,” Harris emphasized. “Wholesale gives them reach and stability, especially in markets where they can’t afford to open dozens of stores. Cutting off those relationships was shortsighted.”
Why Isn’t Management Being Questioned?
For Harris, the decline of Canada Goose is not just a story of shifting consumer trends—it’s a case of mismanagement.
“This was a beloved Canadian brand. We were proud of it, just like we are with Lululemon or Aritzia,” he said. “But its performance stinks lately, and no one seems to be calling out the executive team for their decisions.”
Harris believes it’s time for a hard reset. “They need to sit down and rethink the entire plan,” he said. “Yes, direct-to-consumer can be a good long-term goal. But in the short term, it’s a disaster.”
He added, “They should be leveraging wholesale partnerships to fill in the gaps where their stores aren’t present. That’s Retail 101.”
Lessons from Nike’s U-Turn
Interestingly, Harris pointed out that other major brands—such as Nike—have reversed course on DTC extremism and returned to building wholesale relationships.
“Nike did a U-turn,” he said. “They realized they still needed strategic retail partners to maintain growth and brand strength. Canada Goose hasn’t made that pivot, and they’re paying for it.”
When asked if Canada Goose might eventually follow suit, Harris was cautious. “I don’t see any signs of that yet,” he said. “They’re sticking with a strategy that’s not viable right now.”
The Way Forward?
Asked what Canada Goose can do to restore growth, Harris chuckled before replying, “If I knew what they should do, I wouldn’t tell you for free. I’m not Mother Teresa of Calcutta—I don’t do this for the love of it.”
But he did offer a general direction: “They need to strike a better balance. Get back into key wholesale channels. Invest more in the EU. Stop trying to push $1,000 coats online in markets where you have low brand awareness.”
For Harris, the brand still has potential. “There’s nothing wrong with the product. People still admire the brand. But admiration doesn’t translate to revenue without the right sales strategy.”
A Cautionary Tale in Canadian Retail
As someone who closely tracks Canadian retail performance, Harris views Canada Goose as a cautionary tale.
“They were the darling,” he said. “But they grew too fast, made some wrong bets, and now they’re stuck.”
He added, “We need to start asking harder questions about how these strategies are being implemented. It’s not enough to chase trends—you have to know your customer, your geography, and your capabilities.”
In short, Canada Goose is no longer the unshakable retail giant it once seemed to be. Unless it recalibrates its strategy—and fast—it risks falling further behind in a luxury outerwear market that is rapidly evolving.
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In more or less abandoning its wholesale business in favor of direct to consumer, Canada Goose is well on its way to sealing its own fate. We see it all the time! A brand is so popular, it’s selling out constantly. Then, they see potential in opening their own stores and pull all their products from beloved stores who sell their products so well. We turn away hundreds of customers every season because Canada Goose decided to pull their products! Those customers choose other brands that we do carry. That Canada Goose customer is lost.