The Metro Vancouver Retail Thread

[officedweller]

Almost forgot...

Someone at the office said she heard a rumour that Saks Fifth Avenue would take the top floor of Hudson's Bat downtown Vancouver - meaning the new men's floor would have to move somewhere else!

Also, the Holt Renfrew Spa has closed - paving the way for expansion into the SportChek/Atmosphere space (?)

[Klazu]

Originally Posted by connect2source

Interesting take on the fate of Target in Canada in 2015.

http://www.huffingtonpost.ca/2015/01/05/...tm_hp_ref=mostpopular&ir=Canada+Business

I never shop at either Walmart or Target, but I don't understand why Target has it so difficult to fix their Canadian business? The two problems that people have been stating all along are lack of selection and higher prices, so why is it so hard to fix those?

It would be a very hasty decision to pull out of Canada after only two years, especially now that much less cross-border shopping is happening due to the weaker Loonie. I would think prices being much closer to the US ones now, especially if you factor time and cost it takes to drive down the border...

[officedweller]

I think the problem with Target is that they are too late to the market.

Back in the early 1990s it was the "wow" store because it was bright and fresher with better designed merchandise than other stores of that era. The red colour is also a bit dated these days and may remind people of Zellers.

Nowadays, everyone has upped their game, so Target isn't much better than Wal-Mart - certainly not better enough to pay a higher price on basics.

They still have some uniquely designed lines by famous designers, but on that front, you aren't competing against Wal-Mart, you're competing against off-price retailers like Winners and Homesense - which did not exist in the marketplace when Target was "big" - and they have even better selection on some items (i.e. kitchen stuff) than some specialty stores.

The remaining question will be whether the higher end retailers will have problems, too, from oversaturation.

[Klazu]

That is true, but isn't Target doing well in the States though? Is Canadian retail market really so different and more saturated than in the US?

[Plafuldog]

Originally Posted by Klazu

I never shop at either Walmart or Target, but I don't understand why Target has it so difficult to fix their Canadian business? The two problems that people have been stating all along are lack of selection and higher prices, so why is it so hard to fix those?

It would be a very hasty decision to pull out of Canada after only two years, especially now that much less cross-border shopping is happening due to the weaker Loonie. I would think prices being much closer to the US ones now, especially if you factor time and cost it takes to drive down the border...

They've fixed the price issue and implemented price matching but haven't done a good job of promoting the changes. Most of Target's issues have been the result of outsourcing their supply chain in Canada (which they don't do in the US) so resolving the problem is much more complex. It's not surprising they've had issues considering how many stores they opened at once. The new CEO has rightly admitted this was a bad strategy. Incomes are higher in Canada and retail penetration is much lower so there is certainly considerable opportunity for them to be successful once they can figure out the nuances of implementing a successful strategy here.

[whatnext]

Originally Posted by officedweller

I think the problem with Target is that they are too late to the market.

Back in the early 1990s it was the "wow" store because it was bright and fresher with better designed merchandise than other stores of that era. The red colour is also a bit dated these days and may remind people of Zellers.

Nowadays, everyone has upped their game, so Target isn't much better than Wal-Mart - certainly not better enough to pay a higher price on basics.

They still have some uniquely designed lines by famous designers, but on that front, you aren't competing against Wal-Mart, you're competing against off-price retailers like Winners and Homesense - which did not exist in the marketplace when Target was "big" - and they have even better selection on some items (i.e. kitchen stuff) than some specialty stores.

The remaining question will be whether the higher end retailers will have problems, too, from oversaturation.

I went to Target in Lansdowne for the first time over Christmas and my first reaction was, "what's the big deal?". Harsh lighting, bargain bin layout and crappy clothes.

I wonder if Nordstrom is also in for a nasty shock. Canadians are primarily a cheap people (witness long border line-ups to save a few bucks on gas and cheese). Are there enough Chinese astronauts to keep a store the size of their downtown location in business?

[Vin]

I've been to the Target stores in Tasmania, Australia, and although they seem old and worn out, are doing relatively well. The newer ones here in Canada are way bigger, more modern, neater and cleaner. However, they always seem to be lacking in merchandise. A 'budget' store should be densely packed with an assortment of well priced and attractive goods to be successful. Obviously Target Canada failed terribly in its market research and store design.

[Porfiry]

Originally Posted by Vin

I've been to the Target stores in Tasmania, Australia, and although they seem old and worn out, are doing relatively well.

Target Australia is a completely different company.
http://www.startribune.com/business/220867991.html

[Vin]

Originally Posted by Porfiry

Target Australia is a completely different company.
http://www.startribune.com/business/220867991.html

No wonder, unlike its American/Canadian twin, Target Australia is actually profitable.

[connect2source]

K Mart, Target, Safeway and Woolworth are all completely different companies in Australia. K Mart and Safeway once had ties to the US Parent. The Safeway name recently disappeared in Australia after having totally been absorbed by Woolworth which also once had US ties.

[Conrad Yablonski]

Originally Posted by Vin

..... Target Canada failed terribly in its market research and store design.

Seen it a number of times over the years-bloated, self possessed out of touch foreign organisation fails to perform due diligence, ends up sucking hind teat from day one and whimpering slinks off back from whence they came.

The funniest part of the Target debacle was the way they argued with people on Facebook who complained about high prices and lack of goods-as if it was the customer's fault-that's when I knew it was only a matter of time.

[WarrenC12]

Originally Posted by Conrad Yablonski

The funniest part of the Target debacle was the way they argued with people on Facebook who complained about high prices and lack of goods-as if it was the customer's fault-that's when I knew it was only a matter of time.

I side with Target on that one.

People were screaming for it to come to Canada, and then they were surprised when prices were higher? What kind of an idiot are you if you think prices will be the same as the US. Check Costco, Walmart, and so on.

I like Target in Canada. Great alternative to Walmart IMO. I'm not sure why they are failing TBH.

[theKB]

Originally Posted by WarrenC12

I side with Target on that one.

People were screaming for it to come to Canada, and then they were surprised when prices were higher? What kind of an idiot are you if you think prices will be the same as the US. Check Costco, Walmart, and so on.

I like Target in Canada. Great alternative to Walmart IMO. I'm not sure why they are failing TBH.

Target Canada is just fine IMO not that I really shop there but I would chose it over walmart i guess?

Canadian consumers are dumb for the most part and the feds have done an amazing job blaming the price gap on business even though duties/taxes/marketing boards/transport costs/language labeling requirements etc all do a fantastic job at keeping the prices inflated. I fear that if trader joes were to ever cross the line it would face the same issues as target is facing re pricing.

[AudiA3]

Originally Posted by whatnext

I went to Target in Lansdowne for the first time over Christmas and my first reaction was, "what's the big deal?". Harsh lighting, bargain bin layout and crappy clothes.

I wonder if Nordstrom is also in for a nasty shock. Canadians are primarily a cheap people (witness long border line-ups to save a few bucks on gas and cheese). Are there enough Chinese astronauts to keep a store the size of their downtown location in business?

Lots of US retailers will be in for a shock then... Yeah Canadians are way more financially prudent (cheap) than Americans

[officedweller]

Yeah, generally because our taxes are higher than in the US, so we have less take home pay.

[s211]

Originally Posted by officedweller

Yeah, generally because our taxes are higher than in the US, so we have less take home pay.

In BC, unfortunately yes. AB? Another matter.

[connect2source]

Canadian may be frugal but the luxury sector does very well in Vancouver with lots of room for growth. Our Holts is the top performer nationwide, Hudson's Bay's sales are up significantly since moving more up-market. Many luxury banners are scrambling for space in Vancouver so my guess is Nordstrom will do just fine.

There's a huge difference to their strategy as well, Target opened an insane number of stores all within a very short timeframe, Nordstrom is, very gradually, rolling out only a handful of locations in very carefully selected markets which gives them lots of time to tweak and adjust before all stores are rolled out.

And speaking of the luxury or high-end grocery segment, the West Van Whole Foods locations typically places in the top three performing stores chain-wide which includes all U.S, Canadian and UK locations.

[GeeCee]

My primary issue with Target is that they outsourced their supply chain to Loblaws, so it's basically the same things you find in a Superstore or No Frills but in red. And even then, only about half the stuff for some reason. While it's unreasonable to expect the exact same products as in the US for a variety of reasons, I was expecting them to bring at least SOME of their store brand products with them.

They have great clearance deals if you can find them, however.

[memememe76]

The complaints about CDN Targets having higher prices than USD Targets is pretty lame, but I do think the complaints about the "experience" is legitimate. Generally speaking, Walmarts in Canada are fairly nice. In the US, there are some really, really scary Walmarts. But at least in Metro Vancouver, the Walmarts are pretty nice.

Also, Targets needs to get on the "Super" trend, which Walmart has done. Does anyone really buy fresh food at Target? There is a reason the Superstore in Metrotown is so much busier than Target.

[NewfBC]

Originally Posted by GeeCee

My primary issue with Target is that they outsourced their supply chain to Loblaws, so it's basically the same things you find in a Superstore or No Frills but in red. And even then, only about half the stuff for some reason. While it's unreasonable to expect the exact same products as in the US for a variety of reasons, I was expecting them to bring at least SOME of their store brand products with them.

They have great clearance deals if you can find them, however.

You are so wrong..

"Target’s Canadian distribution centres employ about 1,500 people and are outsourced to a third party logistics firm called Eleven Points Logistics which is an operating division of Genco."
In Canada, Target operates three distribution centers as follows:

1. In Balzac, Alta., Target operates a new 1.30 million sq. ft. regional distribution centre that will support 46 stores from Vancouver to Winnipeg by the end of this year. The furthest store is 844 miles from the distribution centre.

2. In Milton, Ont., Target operates a new 1.32 million sq. ft. regional distribution centre that will support 45 stores in Ontario west of about Kingston. The furthest store is 871 miles away.

3. In Cornwall, Ont., Target operates a new 1.35 million sq. ft. regional distribution centre that will support 41 stores in Eastern Ontario, Quebec, New Brunswick, Nova Scotia, P.E.I., and Newfoundland. The furthest store is 1,644 miles away.

4. In addition, there are four offsite facilities to handle overflow inventory and one National Returns Centre.

"Target Canada has also outsourced food distribution to Sobeys which supplies frozen food, dairy, and dry grocery products, including national brands and Target’s private label products."

http://www.canadiangrocer.com/blog/target-canadas-supply-chain-woes-38347

Target Canada also sells many of their US brands: Threshold, Archer Farms, Up and Up, RE, Market Pantry, etc.

Wow.. you need to do your homework.. I hope this isn't typical!

Ron.