Uniqlo bucks gloomy retail trend with Canadian stores
Sears Canada Inc.’s move to shutter its stores after 65 years in the country may be casting another pall across the world of bricksand-mortar retail, but Asia’s largest clothing maker hasn’t noticed.
Fast Retailing Co. says its Canadian Uniqlo stores are performing “way above expectations.”
More than 1,100 shoppers waited in a line that snaked across two floors in a suburban mall last week for Uniqlo’s opening in Vancouver, the Japanese retailer’s third location in Canada after two in Toronto last year.
The first shopper staked her spot at 5:20 a.m. for the 10 a.m. opening. A similar launch in Toronto last year drew a crowd of 1,800.
The opening crowds are near records globally for the brand — known for its minimalist, affordable basics like $99.90 cashmere sweaters — which now counts more locations overseas than in Japan, Yasu Hayashi, chief operating officer for Uniqlo Canada, said in an interview.
“We knew that if we did Toronto right, it would resonate with customers — it’s a very multicultural, foreign brand-accepting city,” Hayashi said. “But we didn’t expect the response to be this good. I can’t put a number to it, but it’s way above expectations.”
Fast Retailing, whose billionaire chairman Tadashi Yanai has steered the company’s expansion overseas following an unsuccessful effort at home to raise prices, reports fiscal year results on Thursday.
It bucks a gloomier trend in North America where retailers are closing stores amid the march to online shopping.
Sears Canada filed on Tuesday to liquidate its remaining 150 stores with the loss of 12,000 jobs. Reitmans Canada Ltd. and Le Chateau, among Canada’s oldest apparel makers, have shut hundreds of locations in recent years. Target Corp. beat a retreat out of Canada in 2015, less than two years after entering.
Notwithstanding, newer entrants, including Uniqlo, are finding pockets of opportunity in Canada.
Canada Goose Holdings Inc., known for $900 jackets that were sold through wholesalers, is up 65 per cent in New York since its initial public offering in March after opening its first two physical locations.
Miniso, a global lifestyle brand, opened its first Canadian location in mid-April to find items like $29.90 bluetooth speakers flying off the shelves. It plans 10 stores in the country by the end of the year and an eye-opening 500 “over the next few years,” said Yi Ma, Miniso vice-president of business development in Canada.
Dollarama Inc. is growing faster than U.S. dollar-store chains, opening new locations and improving profit margins, helped in part by a less-saturated Canadian market.
These stores may have a latecomer advantage. They’ve avoided over-expanding and can size their physical presence more judiciously, says Maureen Atkinson, a Toronto-based senior partner at global retail consultant J.C. Williams Group. “It’s easier to perform well if you only have a few stores,” she said. After the exit of retailers like Target left holes in many malls, she adds they’re “coming in at a time when they can make a better deal for real estate.”
Mall landlords in some cases would offer incentives such as free rent, and signing bonuses, she said.
Uniqlo has received requests to open from mall operators in other cities, including Montreal, Edmonton, Calgary and Ottawa, and may consider bringing in Fast Retailing ’s other brands, said Hayashi.