People often say to me “you are really smart” and I beg to differ. As a kid I was an average student and I have never been afraid or embarrassed to share the fact that I repeated grade 3. At some point however things changed and I became almost obsessed with learning and being “informed” about what goes on in the world especially business and while I am flattered by comments where people say I am smart, there is a difference between exceptionally intelligence and being knowledgeable through information gathering.
Early in my career I spent several years in and working up through the retail sector including close to 10 years with Canadian Tire. It was a great experience, I learned a lot and over the years it has served me well as I advanced through several executive management positions in both Canada and the U.S. mostly in the manufacturing sector before entering the real estate profession. Even today I am a voracious reader and ever day I awake thinking “what can I learn today?” I have also tried to impart this attitude in my kids.
As a REALTOR® I follow what’s happening in the market very closely and not just in the residential but also in the commercial real estate sector as well, particularly retail. Retail like many other segments of the economy such as manufacturing has gone through wide scale change and recent announcements would indicate it is far from over. Think of the many long standing retailers we have seen disappear, Eatons, Simpsons, Sears, Woolworths, Woolco, Towers, K-Mart, Zeller’s and let’s not forget about Target’s disastrous and short lived expansion into Canada.
The next casualty I have been expecting to fall is Hudson’s Bay. Their stores are for the most part dated, poorly merchandised with products that in my opinion are over priced and offer poor value for consumers. In late February Hudson’s Bay announced they were closing their Home Outfitters stores and some Saks Off Fifth locations claiming that it will allow them to “further streamline their retail portfolio…..” This could prove to be too little too late.
Information just released indicates that clothing retailer Gap is closing 230 stores in Canada and the U.S. and at the same time as Hudson’s Bay announced the Home Outfitters closing Payless Shoes was doing likewise for their retail outlets across Canada.
Online shopping through the likes of Amazon is taking a lot of heat for the demise of many bricks and mortar retail outlets but I am not convinced that they alone are entirely to blame. Let’s face it, we are an aging population and personally as I get older I find that I need less. We instructed our kids not to buy us Christmas gifts as we need nothing. Even when I am in need of or in the market form something I expect value whether it’s for cloths or a car. A dress shirt at the Hudson’s Bay for $130 is not in my opinion good value no matter how nice it may be. In addition I no longer find traipsing around a huge mall fun. Yesterday while in Barrie for a medical appointment I did visit Georgian Mall. The first thing that jumped out at me was that there is still a Sears sign on the exterior of mall surrounded by peeling paint. It’s been over a year since Sears announced they were shutting down their Canadian stores. I am surprised that this sign hasn’t been taken down and the building freshened up a bit to help attract shoppers at a time when there are other options.
I will confess that I do some shopping online including Amazon which is typically not for cloths especially for shirts, pants, and shoes etc. that you really needs to try on. While Costco has a good prices on clothing, the lack of dressing rooms makes size selection a bit awkward.
Overall I believe the real issue at hand is that we are simply “over retailed” relative to demand. Some retailers have expanded too aggressively through store expansion and acquisition much of it resulting in huge debt loads that they now find they cannot afford. I also believe that in recent years retailers have benefited from increased consumer spending driven by low interest mortgages, home equity loads, credit cards and other sources of money. Many real estate markets across Canada slowed in 2018 and this trend is expected to continued for the next year or two. If home price appreciation slows or worse drop even slightly, this will certainly have an impact on consumer spending so to place all of the blame on online shopping is neither a fair or accurate analysis of what might really be going on with retail.
As it has been said many times, we are in the “information age” and I am a great believer that acquiring accurate and timely information is knowledge which is why I endeavour to absorb as much knowledge as I can. It’s not about having a negative attitude it’s about been informed so I can be a better person and in the case of real estate so I can provide in depth, accurate and relevant information in order to best serve my own needs and those of my valued real estate clients.
What are your thoughts?