Posted Apr 24, 2007, 4:50 PM
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Join Date: Feb 2006
Location: Montreal
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Bed Bath & Beyond eyeing Canadian market again
MARINA STRAUSS
Globe and Mail Update
April 23, 2007 at 9:15 PM EST
The heated home fashions market is about to get even more crowded as Bed Bath & Beyond Inc., the largest chain in the U.S. sector, scouts for store locations in Canada, industry sources say.
The retailer, known for its large selection of merchandise, stylish offerings and chic store layouts, has had a strong track record in its home territory and is sure to provide stiff competition for existing purveyors of home furnishings, Wendy Evans at Evans & Co. Consultants Inc. said Monday.
“It will be felt quite significantly in this market,” she said.
The chain responds well to trends, continually stocking new products in its 816 stores. And it moves fast, she added.
More generally, “it will add new products to their stores that this market has never seen,” she said. And while the merchandise is mid-priced, its attractive displays give it an aura of luxury goods.
Kenneth Frankel, director of investor relations for Bed Bath & Beyond in Union, N.J., would not confirm its interest in Canada. “We're always looking,” he added. “We look domestically and wherever. Obviously we're continuing to grow.”
Still, the Canadian market is getting crowded. Earlier this month, Crate and Barrel, another leading U.S.-based home goods merchant, confirmed that it will open its first store here in Toronto's Yorkdale Shopping Centre in the fall of 2008.
Hudson's Bay Co. launched its own Home Outfitters chain in 1999, modelled largely on Bed Bath & Beyond. Now industry insiders are predicting that Bed Bath & Beyond will eventually scoop up Home Outfitters. But Jerry Zucker, the new owner of HBC, wants to keep the home goods chain as part of the larger company, rather than break it up, spokeswoman Hillary Marshall said. The 59-store Home Outfitters “is not for sale.”
Sources said Monday that Bed Bath & Beyond officials are holding talks with Canadian real estate brokers about finding locations in Vancouver, Toronto, Ottawa and Calgary, a source said. They are looking for stores that are between 20,000 and 50,000 square feet in a select number of power centres, the sources said. The biggest outlet would be roughly the size of a Best Buy electronics store.
The home furnishings segment has been one of the hottest in Canadian retailing, growing at a rate of 10 per cent annually over each of the past few years, Ms. Evans said.
The domestic sector has not felt the crunch that its U.S. counterparts are experiencing because of the tougher housing market south of the border, she said. Canadian retailers are still enjoying gains.
It isn't the first time that Bed Bath & Beyond has looked seriously at the Canadian market. Almost a decade ago, it was slated to become one of the big draws at the then yet-to-be-built Vaughan Mills shopping centre, north of Toronto. A U.S.-style shopping and entertainment mega-mall, it opened in late 2004 – the first enclosed regional mall to be built in this country in more than 14 years.
Ms. Evans, who acted as a consultant during the mall's planning, said Bed Bath & Beyond hadn't exhausted its growth opportunities in the United States at the time.
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