MARKET FOR DECADES
THE COMPANY RECENTLY INKED DEALS TO OPEN ZEGNA
STORES IN CANADA AND ALSO ACQUIRED A WOMEN’S SHOE RETAILER.
HARRY ROSEN HAS A LOCK on the Canadian men’s wear market, but that hold hasn’t come without a lot of hard work. The company was founded in 1954 by Harry and his brother Lou Rosen in a small storefront in Toronto to provide made-tomeasure suits for men. The firm has since grown into a 300 million Canadian dollar ($228.3 million), 18-store chain with locations in the seven largest cities around the country and some 1,000 employees.
Although Harry stepped back from the day-to-day operation of the business in 2005, he still serves as an ambassador, often stopping by one of the stores to chat with customers. But he left the company in good hands: as chief executive officer since 2000, his son Larry Rosen has built on his father’s legacy. Waiting in the wings is Ian Rosen, Larry’s son, who is joining the family business this summer to oversee its digital marketing initiatives, and at the same time, ensure the eventual transition to the next generation will be seamless.
But Harry Rosen has also branched out beyond its core business, teaming up with Ermenegildo Zegna to open flagship stores for the luxury Italian label in Canada. In August, a 3,000-square-foot Zegna store will open on Bloor Street West, steps away from Harry Rosen’s flagship 55,000-squarefoot store. The 4,500-square-foot shop in Vancouver’s Pacific Centre — which Rosen has quietly operated for Zegna for years — will be revitalized with a Peter Marino design. And there are plans to open more.
At the same time, the company has entered into a joint venture with Davids Footwear, another family-owned business in Toronto that sells designer shoes and accessories for women. The plan is to revamp and upgrade that brand to Harry Rosen levels and begin a national rollout in Canada.
Here, Larry Rosen talks about what makes Harry Rosen special, its history, its future and the other retailers he admires.
WWD: Can you run through the history of the company?
Larry Rosen: It’s a great story of entrepreneurialism. Harry, my father, is almost 87 and in fine shape and is still a mentor for me, and one of the people I admire most. He and his brother Lou started in 1954 and in 500 square feet, they built a made-tomeasure business. They really started by bringing a look to Canada that Canada didn’t have. In those days it was called the Brooks Brothers look: the Madison Avenue, natural-shoulder look. He actually went down to New York, bought a suit, took it to a local maker named Coppley and they duplicated it. And all the young executives in Toronto flocked over there. He was so successful that by 1961, he moved the business to a great location in the heart of Bay Street, which is our Wall Street. He built a very large business and then expanded to a second store in Yorkdale in 1968; Bloor Street was the third in 1970. Then in the early Eighties, he started expanding across the country and now here we are in the seven major markets in Canada with 15 mainline stores and a few outlets and a strong, strong online business.
WWD: Why do you think the business has been so successful and when did you join?
L.R.: My father is a real entrepreneur. He’s a guy who wills business into existence — he’s brilliant. I did an undergraduate at the University of Toronto in economics, I then went to the University of Western Ontario and got a law degree and an MBA. I practiced law in Toronto for a few years and in 1985, I was so proud of my father expanding throughout the country that I said I have to be part of this. So I joined. I started as a buyer, then I ran stores. By 1997, I became the president, and in 2000, after the tragic death of our former ceo Bob Humphrey, I became the ceo. Harry stepped back from active involvement in the business around 2005. I have a tremendous team of executives around me; the most recent is my son, Ian. We’re all about transition and succession.
WWD: You once had a store in the U.S. What happened to that?
L.R.: We did have a store in Buffalo in 1987 and it was successful, but in 1995 we started a whole venture of bringing Hugo Boss stores to the United States. We had nine of them, but in 2001, I said it was too difficult to run remotely, so we sold it back to Hugo Boss. We had converted the Buffalo store to Hugo Boss at that point. It was a great learning experience for me and I realized that if you spread yourself too thin, your business gets hurt.
WWD: So that’s why you never really tried to move into the U.S.?
L.R.: Harry Rosen’s brand is so well established here — in Canada it’s the place to shop for men. To be honest, I think there’s room in the [American] market for us, but it’s not on our current horizon. Expanding our reach in Canada is our focus for the time being, between the Zegna venture and Davids and other opportunities that will come along. We just brought in my son and set some pretty aggressive targets for him to achieve. Our digital business is the strongest part of our business — it’s grown 40 percent over the past year — but we think that having him work with our head of e-commerce, we can grow that very aggressively.
WWD: Are all your stores in big cities? L.R.: Yes. Harry Rosen stores have to have critical mass. Our smallest store is about 8,000 square feet, but I wouldn’t open a store today under 12,000 square feet, and that would be a small satellite store. There are seven major markets that can support a Harry Rosen store in Canada. Greater Toronto is over 6 million people so we have seven stores in Toronto, two in Montreal, one in Ottawa, four in Vancouver, two in Calgary, one in Edmonton and one in Winnipeg. In every city, we’re the major quality men’s store. With the convenience of online, unless a store has a superb selection and outstanding service, there’s no rationale for it in the market. You’ve got to go big or go home.
WWD: Have you ever entertained going into women’s?
L.R.: With Davids, we’re now in the women’s shoe business, and we’re learning. But I wouldn’t enter women’s under Harry Rosen. We did research and it has a very masculine persona as a brand, although women all the time tell me that they would also love to have the customer service and selection and merchandising — all the things that Harry Rosen stands for. At one point in the late Eighties, we actually did women’s, but we went into it for the wrong reasons. One of the things about us is that we’re a specialty store and we’re experts and I think if we water down our brand in any way, I think it takes away from the focus. When we acquired our interest in Davids, people asked if we were going to put Davids departments in Harry Rosen and we said no. To me, we want to make Davids into the greatest experience in women’s footwear in this country and we want to bring together a curated selection of the greatest brands with a high level of service and a really exciting environment and be to that women’s customer what Harry Rosen is in men’s wear. We have no interest in changing it into something it isn’t or combining the labels. We want to keep them separate in terms of their branding.
WWD: Whom do you consider the competition for Harry Rosen?
L.R.: Holt Renfrew, Nordstrom at the lower end, Saks Fifth Avenue, and a lot of single-vendor brand stores such as Hugo Boss, Burberry, Moncler. There are also some independent stores so there’s lots of competition.
WWD: American retailers have not had an easy time breaking into the Canadian market historically. Why do you think that is?
L.R.: It’s difficult because while there are a lot of similarities between Americans and Canadians, there are also points of differentiation. We’ve had an onslaught of American department stores but they haven’t taken market from us. I think it’s mostly a women’s wear game, but with Saks for example, if someone in New York City is deciding what someone in Edmonton or ►