Canadian Retail is “Running with Bulls”
Every July, since the 13th century, there has been a festival held in Pamplona, Spain where corks explode into the air, and champagne flows for an event known as the “Running of the Bulls”. On-lookers fill the streets and every available window and balcony with singing, cheering and partying for the parade of bulls that will participate in that evening’s bull fight. it was apparent that the cutting of employee hours had lead to lower service levels which resulted in lower sales volumes.

The bulls are released from a holding pen and driven through the narrow streets of the city, behind crowds of street runners, who scramble and dodge and try to outrace the crazed animals to the bullring.

Say what you might about this event from many different aspects, the images that are conjured up of this event are those of exhilaration, chaos, panic, thrill, danger and celebration. The skills needed to claim victory for the participants include planning, speed, perseverance, common sense and a complete focus of the task at hand.

So it is with the Canadian retail landscape as we start 2011. The “bulls” if you like are the never ending list of retailers charging to set up shop and launch their concepts in economically positive and safe Canada. Consider the list of the declared “bulls” thus far – Marshall’s, Target, Zumiez, Joe Fresh, Kohl’s, J.Crew, Express, Dick’s Sporting Goods and Simon’s. These new entries coupled with recent newbies that want even more space such as Victoria’s Secrets, Coach, Bath & Body Works, Crate & Barrel, Apple, Coach, True Religion, Lucky Jeans, etc. have created an environment where demand is surpassing supply.

There are 46 square feet of retail per person in the US compared to Canada’s per capita retail space of 13 square feet – more than 3 times. The existing retail space cannot accommodate all of the players that are looking for space. The outcome will inevitably be the displacement of those traditional retailers that cannot compete with these new, fresh and mostly American “sexy” retailers. The competition for space, as well as the competition for sales is about to get a whole lot tougher. Like the on-lookers of the bull run, there is great celebration by Canadian consumers as the competition heats up for their consumer dollars offering more choice and better prices. However, there will undoubtedly be a scramble for the existing retailers to outrace the “retail bulls” and not be gored or trampled.

 

 


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