General Retail News

[rocketphish]

Tip Top Tailors restructuring may shutter stores
Chain operates 158 stores in Canada with more than 1,200 employees

CBC News Posted: Jan 26, 2017 12:55 PM ET Last Updated: Jan 26, 2017 1:23 PM ET

The owner of Tip Top Tailors, George Richards Big and Tall, Kingsport and other brands is asking for protection from its creditors as it restructures while facing tens of millions of dollars in debt.

Grafton Fraser Inc. sought and was granted court protection under the Companies Creditors Arrangement Act this week, citing "lower than expected retail sales, increased overhead costs, delays in receipt of seasonal inventory and turnover of key personnel," in a court filing as reasons for its latest financial difficulties.

The company operates 158 stores across Canada and employs 1,226 people. Filings suggest the company owes more than $60 million, and part of its restructuring plan includes the "proposed closure of underperforming locations."

It's the second time within a year that Grafton has sought court protection for one of its brands, as it was unable to make a go of the Jones New York line after acquiring it from its U.S. owners. All 37 Canadian stores have since closed.

The retailer's woes are just one of a slew of recent failures in the tough sector, including Mexx, Smart Set, Nine West, Danier, Laura, Jacob, and many others.

Two of the chain's largest creditors are CIBC and the New York-based firm GSO Capital Partners LP. Grafton owes $12.8 million to CIBC and $39.4 million to GSO. Grafton also owes more than $8 million to various other unsecured creditors, filings show.

In a separate filing, Grafton reveals it has a so-called "stalking horse bid" from a GSO-related subsidiary that would see that numbered company buy all or part of Grafton's assets. But that offer depends on whether other interested parties step up with an offer for any part of the business.

http://www.cbc.ca/news/business/grafton-tip-top-retail-1.3953307

[jcphoenix]

^Good riddance. I had a horrible experience dealing with Tip Top at Bayshore for my brother's wedding a few years ago where they took bad measurements, ordered vests that turned out gigantic and didn't remotely fit, and the guy actually tried to blame us for it and try to make us pay for their ill-fitting vests. Thankfully, Morris Formalwear saved the day for us but I swore never to go to a Tip Top Tailors again. I feel nothing but schadenfreude.

[SpongeG]

i never associated ottawa with wealth, more of a government blue collar type town. Nordstrom is just too expensive, at least the canadian version is. Many of the US stores are more like the bay, they have dockers intead of dior. But they made all the Canadian stores high end ones, maybe a bad move on their part. Perhaps they will adjust to better suit the market they are in.

[1overcosc]

Originally Posted by SpongeG

i never associated ottawa with wealth, more of a government blue collar type town.

Ottawa is actually very white collar--Ottawa's ratio of white collar workers to blue collar workers is probably one of the highest in Canada. It's definitely not a working class city. But you're right in that it's not a city of wealth. It's a city of middle to upper middle class people.

[bikegypsy]

Originally Posted by SpongeG

i never associated ottawa with wealth, more of a government blue collar type town. Nordstrom is just too expensive, at least the canadian version is. Many of the US stores are more like the bay, they have dockers intead of dior. But they made all the Canadian stores high end ones, maybe a bad move on their part. Perhaps they will adjust to better suit the market they are in.

Wow. Where to start? Ottawa is one of the wealthiest metro regions in Canada, the vast majority of government workers in Ottawa are white collar, Ottawa has other types of workers besides civil servants -- and these, like 1overcosc stated, are mostly white collar -- and Nordstrom is doing well every where in Canada.

[HighwayStar]

Originally Posted by 1overcosc

Ottawa is actually very white collar--Ottawa's ratio of white collar workers to blue collar workers is probably one of the highest in Canada. It's definitely not a working class city. But you're right in that it's not a city of wealth. It's a city of middle to upper middle class people.

Very true... and don't forget in the coming decades the city will be loaded with retirees whose pensions alone will put them in the top 10% of income "earners" in Canada... Factor in Pensions, and a non-trivial % of the population of Ottawa is most definitely "upper class".

[TheGoods]

Originally Posted by SpongeG

i never associated ottawa with wealth, more of a government blue collar type town. Nordstrom is just too expensive, at least the canadian version is. Many of the US stores are more like the bay, they have dockers intead of dior. But they made all the Canadian stores high end ones, maybe a bad move on their part. Perhaps they will adjust to better suit the market they are in.

I totally disagree, Ottawa is fairly wealthy, it was ranked second (after Calgary in Median Total Family income right after Calgary in 2014 census. It is probably first now (due to oil crisis).

http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/famil107a-eng.htm

For sure, we do not have the same population as Montreal, Toronto or Vancouver or the same amount of individuals that are insanely rich but the income can easily support a Nordstorm. We had a Holt and Renfrew in Ottawa for over 70 years. The only reason they closed was that their store was too small and would not be able to compete with Nordstorm.

[acottawa]

I'm not sure a high median income indicates a high percentage of nordstrom shoppers. A family with a take home of about $1k/wk is not going to be doing a lot of Nordstrom shopping.

[YOWflier]

Originally Posted by acottawa

I'm not sure a high median income indicates a high percentage of nordstrom shoppers. A family with a take home of about $1k/wk is not going to be doing a lot of Nordstrom shopping.

Um, do you think $1K/week for a family constitutes a high income? That equates to roughly one individual grossing $75K or a couple grossing that much together. Not so high actually.

To start, double that (at minimum) and go way up from there.

[acottawa]

Originally Posted by ac888yow

Um, do you think $1K/week for a family constitutes a high income?

To start, double that (at minimum) and go way up from there.

No, people were using median incomes as evidence of Ottawa's affluence. I think a median family income in Ottawa funds a comfortable but modest lifestyle.

[YOWetal]

Originally Posted by ac888yow

Um, do you think $1K/week for a family constitutes a high income? That equates to roughly one individual grossing $75K or a couple grossing that much together. Not so high actually.

To start, double that (at minimum) and go way up from there.

The median couple in Ottawa makes well over that in take home pay. Median income is around $110,000 per year. $2000 a week take home probably still only barely top third in Ottawa. (for a couple). I think Ottawa's median is behind only Calgary and barely. Of course Ottawa's tops 10% might be much better off.

[YOWflier]

Originally Posted by acottawa

No, people were using median incomes as evidence of Ottawa's affluence. I think a median family income in Ottawa funds a comfortable but modest lifestyle.

Well, it is an indicator of affluence (relative to the Canadian median), but it doesn't necessarily equate to "Nordstrom shoppers". That line's a blurry one.

[acottawa]

Originally Posted by YOWetal

The median couple in Ottawa makes well over that in take home pay. Median income is around $110,000 per year. $2000 a week take home probably still only barely top third in Ottawa. (for a couple). I think Ottawa's median is behind only Calgary and barely. Of course Ottawa's tops 10% might be much better off.

Household median income is 102k, take off 40% for taxes/deductions (obviously this varies) and 4k for property taxes (assuming median tax bill) and that is $1100 a week. How far that goes depends on dependents, mortgage, savings, pension, etc but probably not many Nordstrom-type shoppers in that income bracket.

[eemy]

You do understand how median incomes work, don't you? Half of the population has an income greater than that, some will be considerably more than that.

EDIT: If you argue that Ottawa's median family income is too low and doesn't support Nordstrom, the same argument holds for every other city in Canada as well.

[TheGoods]

Originally Posted by acottawa

Household median income is 102k, take off 40% for taxes/deductions (obviously this varies) and 4k for property taxes (assuming median tax bill) and that is $1100 a week. How far that goes depends on dependents, mortgage, savings, pension, etc but probably not many Nordstrom-type shoppers in that income bracket.

Median income for a family also includes a family of 1 (one individual) if they are the only person within a residence. Now, the median is $102k, you have half of the population making more than that since it is not an average but a median. Not sure, what the top 10% is but I’m guessing that is all they need to support Nordstrom.

Look around, I can tell you that there is plenty of wealth in Ottawa, see what types of cars individuals are driving (shocked to see so many cars in and over the $100k range), look at the many neighbourhoods and homes prices.

Btw, Nordstrom is not that expensive compared to Holt and Renfrew and for men, Harry Rosen carries more items that are more expensive than Nordstrom. A lot of their product line is also being carried at either Simons or the Bay (Rideau).

[TheGoods]

Originally Posted by jeremy_haak

You do understand how median incomes work, don't you? Half of the population has an income greater than that, some will be considerably more than that.

EDIT: If you argue that Ottawa's median family income is too low and doesn't support Nordstrom, the same argument holds for every other city in Canada as well.

Exactly! You actually stated it better than I did.

[ars]

Ottawa is collectively a wealthy city, but, as 1overcosc said, the vast majority of the population falls under the categories of middle and upper middle class. If we were to look at wealth in terms of individuals, I'd guess that Ottawa probably has less "super wealthy" people compared to any other big city in Canada.

[YOWflier]

It also probably has way less super poor.

[acottawa]

Originally Posted by jeremy_haak

You do understand how median incomes work, don't you? Half of the population has an income greater than that, some will be considerably more than that.

EDIT: If you argue that Ottawa's median family income is too low and doesn't support Nordstrom, the same argument holds for every other city in Canada as well.

Yes I know what median means.

I'm just saying that a high median income is not a sign of affluence nor it is a sign of a high number of potential customers for quasi-luxury stores. To get a sense of that you would need income quintiles for Ottawa.
http://www.moneysense.ca/save/financial-planning/the-all-canadian-wealth-test-2015/

[TheGoods]

Originally Posted by ars

Ottawa is collectively a wealthy city, but, as 1overcosc said, the vast majority of the population falls under the categories of middle and upper middle class. If we were to look at wealth in terms of individuals, I'd guess that Ottawa probably has less "super wealthy" people compared to any other big city in Canada.

Totally agree with you but Nordstrom is not targeted for the ultra-rich. They spend their money in Yorkville / Bloor area (Toronto), Ogilvie’s in Montreal or Holt in Vancouver at stores or in store boutiques such as Channel, Dior, Dolce, Oscar De La Renta or Louis Vuitton. Nordstrom is not selling a $20k Hermes handbag or a $10k Channel summer dress. Ottawa is not getting a full line Saks Fifth Avenue since there is not enough ultra-rich but Nordstrom is for the rich and upper middle class.

I would say that a Nordstrom is a BMW or Mercedes in the car world (we see plenty of them on the road) were the ultra-rich would buy a Bentley, Aston Martin or Ferrari as an example. BMW or Mercedes have entry level pricing which is more than the American big 3 and goes up, same as Nordstrom.