Sears Canada closing stores?

[NAB]

Just heard a report on local radio Sears Canada is apparently closing some stores in major centres, Vancouver and Calgary being two of them I think. There go a bunch more private sector jobs :-(

Nab

[wthwyt]

Not surprised it's amazing they have lasted this long.

[oneh2obabe]

Sears Canada will close three large stores in premier locations by the end of October, including the anchor store at the Rideau Centre in Ottawa, the Sears at the Chinook Centre in suburban Calgary and the eight-floor store at the Pacific Centre in downtown Vancouver.

All are located in Cadillac Fairview malls.

A spokesman for Sears said 670 people are currently employed at the three locations: 310 in Vancouver, 160 in Calgary and 200 in Ottawa.

Ending the leases in the three locations will generate $170-million pretax for the retailer, which has already cut 470 jobs and slashed prices amid sliding sales and profits and the threat of new competition from Target. The U.S. retailer of cheap-and-cheerful fashion and homeware plans to enter the Canadian market beginning in 2013.

Calvin McDonald, president and chief executive officer, Sears Canada Inc., said Cadillac Fairview first approached Sears about four weeks ago.

The deal was attractive to Sears because the locations weren’t playing to the retailer’s strengths and the money will help Sears drive growth in other areas, he said.

“This was the right move for Sears,” said McDonald. “This isn’t an exit of the market.”

He pointed out that the three cities have numerous other Sears locations – nine in the Vancouver area alone.

Part of the transition plan will involve moving as many qualified employees as possible into surrounding stores and expanded operations in markets including Ottawa, where the Pinecrest Sears Home Store will expand from 42,000 to 68,000, re-opening with a new look in June.

“It was a tough day for many people. We have a wonderful associate base that has been very loyal,” said McDonald.

Sears is also expanding some dealer operations in smaller markets, growing locations from 3,000 square feet to 20,000.

It is also planning to refresh four full-line stores in Barrie, Belleville, Newmarket and Hamilton by mid-May and plans to launch small urban major appliance stores in Toronto.

Analyst Keith Howlett of Desjardins Securities described the news Friday as positive, allowing Sears to monetize three under-market leases.

“Sears Canada has a strong balance sheet underpinned by owned real estate and valuable under-market leases. These assets afford the company some additional breathing room, as it seeks to turn the tide of declining sales and profitability,” he wrote in a note on Friday.

The Vancouver and Ottawa locations are former downtown Eaton’s locations re-opened as Sears stores in 2000. The suburban Calgary location has been a Sears store since 1965. The Chinook Centre is Calgary’s top-performing mall, according to Howlett.

Sears reported in February that profit fell to $38.7 million or 36 cents a share, from $82.7 million, or 77 cents the previous year.

Sales at stores open more than a year, considered a key retail measure, were down 7.4 per cent compared to the year earlier period.

Sears is majority owned by Sears Holdings in the United States.

Cadillac Fairview confirmed the deal to end the lease agreements. The move makes it possible for the mall owners to rent the spaces to new tenants at higher rates, although no one was revealing who is interested in the locations.

“Sears has been a valued and long-standing tenant of Cadillac Fairview and continues to be an important tenant in several CF shopping centres,” according to an e-mail from Cadillac Fairview in response to an interview request.

“Cadillac Fairview is always looking for opportunities to update the merchandising mix at our shopping centres, to create a fresh and enticing shopping environment for our customers, and this agreement with Sears is a reflection of that.”

http://www.thestar.com/business/article ... ities?bn=1

[FreeRights]

Shocked that they are closing the downtown Vancouver store. Besides the HBC, Sears probably holds the largest retail store in the downtown core.

[Merry]

For those of us who are middle aged and don't shop in the "high end" fashion stores, Sears and the Bay offered the only shopping alternatives in the Vancouver downtown core. Now that the Bay is the only one left, it doesn't give folk like me much incentive to go on a shopping trip downtown Vancouver.

It's just one more "death blow" to downtown shopping for regular folk. There was a time when my hubby and I used to enjoy a weekend away in downtown Vancouver, but between the very expensive "high end" restaurants, "high end" stores and "high end" hotels, such weekends are increasingly becoming the purview of the rich.

[grammafreddy]

I guess it's all relative, Merry. To me, Sears and The Bay ARE high-end pricey stores.

Does not surprise me that Sears is leaving downtown Vancouver. Hell, not even WalMart goes into downtown cores - land and other costs are just too high for them, although I think Cadillac-Fairview is maybe giving Sears a bit of a push out the door. No doubt, Sears has an old, long-time lease there and CV can probably get more by either splitting up the space or through a new lease with a different large tenant.

A few of the big box stores are rethinking their goods delivery methods, going more into neighbourhoods and building smaller stores and with a smaller range of goods. Not so "big box". WalMart is doing that.

[wthwyt]

Yep biggest killer of local & small stores is Wal-Mart, I wouldn't step into one even if they were giving merchandize away.

[grammafreddy]

Yep biggest killer of local & small stores is Wal-Mart, I wouldn't step into one even if they were giving merchandize away.

Well, if there was no demand, they would be out of business - so obviously people are using their services.

I credit WalMart with very astute marketing. There's lots of lessons to be learned from the way they do business.

[wthwyt]

Yep biggest killer of local & small stores is Wal-Mart, I wouldn't step into one even if they were giving merchandize away.

Well, if there was no demand, they would be out of business - so obviously people are using their services.

I credit WalMart with very astute marketing. There's lots of lessons to be learned from the way they do business.

Being able buy in huge bulk & bully suppliers helps, unlike the little guy. Well you go to Wal-Mart and enjoy......... Oh by the way there are not always the better buy but they try by having loudest BS voice.

[EdCase]

Well, if there was no demand, they would be out of business - so obviously people are using their services.

I credit WalMart with very astute marketing. There's lots of lessons to be learned from the way they do business.

A often tell my American relatives how unpatriotic they are to shop at Walmart: every time they do, they're exporting one more friend or relative's job offshore and dooming them to some part-time, low-paying job.

Oh Walmart are astute alright; drive wages lower to the point where people just have to buy low-quality merchandise at their stores!

[grammafreddy]

Being able buy in huge bulk & bully suppliers helps, unlike the little guy. Well you go to Wal-Mart and enjoy......... Oh by the way there are not always the better buy but they try by having loudest BS voice.

A wise shopper will know they are not always the best buy and will shop accordingly.

Suppliers also make choices. Nobody is forcing them to do business with WalMart.

[grammafreddy]

Oh Walmart are astute alright; drive wages lower to the point where people just have to buy low-quality merchandise at their stores!

WalMart in Canada pays about the same (no less than minimum wage) as most other retail outlets - big box or small local. Most retail does not offer any benefits so that's not an argument, either. When I worked there a long time ago I was paid quite well for the job I was doing. Another similar retail outlet in town paid me the same wage.

[wthwyt]

Being able buy in huge bulk & bully suppliers helps, unlike the little guy. Well you go to Wal-Mart and enjoy......... Oh by the way there are not always the better buy but they try by having loudest BS voice.

A wise shopper will know they are not always the best buy and will shop accordingly.

Suppliers also make choices. Nobody is forcing them to do business with WalMart.

That's why more supplier are out of Southeast Asia. (child workers/sweat shops)

[JLives]

Please return to topic

[grammafreddy]

I expect Sears' decision is more based on changing their "look" and their market (middle income) than it is on anything else.

When one stops to think of it, Sears is just another middle income big box American retailer. Don't really understand anyone's loyalty. Most of their products come from China (etc), too. Their house brand(s) are just renamed other brands, kinda like President's Choice, Great Value, Western Family are.