More Canadian retailers may be in trouble come 2018
Last week, the “Demise of Sears Canada” was named the top Canadian press story of 2017, and it’s looking like 2018 will continue to pose challenges for Canadian retailers.
Global chair for KPMG’s consumer and retail practice, Willy Kruh, has some words of caution for Canadian retailers, and the landscape they may face in 2018 after this holiday season comes to a close.
"I think the point is that Canadian retail needs a real wake-up call about what's coming in 2018 and in the future, based on what we are seeing today," Kruh told the CBC's Meegan Read in a recent interview.
According to Kruh, the US saw the most store closures back in 2008, approximately 6,100 stores. That number is expected to be surpassed this upcoming year, with around 9,000 stores projected to close. Kruh went on to note that the US projection can be a good indicator as to what to expect here in Canada.
"More than they've ever had in their history, and that is at a time when the [U.S.] economy is strong, consumer confidence is relatively high, [and] the wealth effect, stock market, [and] home prices are high," he said. "So there is a lesson there, and there is something to be seen by that. It's not a coincidence, and similar things are happening in Canada."
With the shift to e-commerce shopping, business like Amazon and even Walmart continue to boom, forcing retailer to reevaluate their businesses. In order to stay above the water, Kruh said that there are three key factors that retailers need to evaluate to adapt their businesses: changing demographics, new technologies, and geography/geopolitics.
Here is hoping that Canadian retailers can find ways to remain profitable in 2018, adapt to the new age of consumerism, and hold their own against the online giants.