Page 19 - MENU Magazine - Sept/Oct 2017

BACK OF HOUSE
While reading the newspaper can be depressing at the best of times, the business section now reads like the obituaries given the number of high-pro le retail closures in Canada. Year after year, the body count is growing, resulting in thou- sands of lost jobs.
Sears has made headlines with the closing of nearly 60 stores by the iconic retailer. Also making news is the closure
of other major chains, such as American Apparel, HMV and women’s clothing seller Bebe. Several other stores have announced they are shrinking their footprints, such as Abercrombie & Fitch and Guess.
Much like foodservice, the retail indus- try operates on slim pro t margins where only the strongest survive. Yet it’s fasci-
BY CHRIS ELLIOTT
nating to watch the dramatic transfor- mation of the retail landscape in the past few years, and what is to come. A study put out by Credit Suisse estimates that between 20 and 25 per cent of American malls will close within ve years. Business Insider calls it the “Retail Apocalypse.”
WHAT LED TO THE “RETAIL APOCALYPSE”?
With the advent of e-commerce, con- sumers have radically transformed how they shop. Eight in 10 Canadians are now shopping online and e-commerce sales are forecast to rise by 64 per cent by 2020. This shift from a bricks and mortar retailer to online shopping has led to
the demise of many retailers. Some are moving all their storefronts to the digital
SUCCESSFUL OPERATORS ARE ALSO GOOD AT SOMETHING. THEY HAVE
A UNIQUELY NICHE BRAND OR MENU ITEM THAT IS BETTER THAN THEIR COM- PETITION.
world in a last-ditch e ort to survive. Consumer tastes have also altered
where people shop. There is the much- talked-about “death of the middle.” This
is where mid-tier retailers like Sears are losing market share to the extremes: from the high-end and luxury brand stores (Saks Fifth Avenue, Nordstrom), to the val- ue-type stores (Walmart, Winners) and the extreme-value stores (Dollarama).
The growth in high-end luxury is per- plexing since real median wages in Canada have been relatively at, and Canadians are saddled with record debt. Yet, strong gains in the stock market and soaring housing prices are boosting luxury sales. Even the non-wealthy are opening their wallets to indulge in the luxury lifestyle.
CONTINUED ON PAGE 20
CAN RESTAURATEURS
AVOID THE
“RETAIL APOCALYPSE”?
SEPTEMBER / OCTOBER 2017 MENU 19