We all know how this goes.
They already hold a combined 57% of the shares. So get ready for a PE gutting of all actual valuable assets (real estate,) and the eventual debt riddled husk that's left of The Bay to be shut down sometime in, oh, about four years. I wonder who will be the new tenant at the Queen Street store? Perhaps Ford or the new OMB will simply approve demolishing it and building a generic 50 floor condo called "The Bay."
I certainly hope for a better fate than that.
The core asset isn't losing much money (and makes some depending on the quarter).
It's the Lord and Taylor division and Off 5th that are real drains on the company.
Saks and HBC do both need to trim their footprint; though I disagree w/the way Hudson's Bay is tackling it.
I think the focus should be on the flagship stores which should be as big as they've ever been.
They are the showroom for the online product; the place to be inspired or to try new things or to build a personal relationship with a professional shopper, a tailor, the people setting up a bridal registry etc.
They are the experience around which your brand is built.
By contrast most of the smaller market/suburban stores will lose money or turn ever smaller profits in an online world.
The GTA can support, maybe, 5 or 6 flagship Hudson's Bay stores.
I would retain:
Queen
Yorkdale
Square One
STC
I'm on the bubble about:
Sherway
Oshawa
Burlington
Fairview
Bramalea
I would close:
Bloor Street (but move Sak's there)
Pickering
Eglinton Square
Centrepoint
Hillcrest
Woodbine
Erin Mills
Upper Canada
Burlington Mapleview
Oakville
I would open:
Downtown Hamilton. (it's starting to happen here, I could see an experiential store as a flagship for the downtown and broader Hamilton area; if this were done, I would close the other Burlington store)
North York City Centre (the density, transit and highway make this location very workable, you just need the right development to bring it to life)
GTA overall
Keep up to 7
Open up to 2
Close 10
But those remaining stores should be:
-3 floors minimum
-Feel grand inside and out
-Feature a restaurant
-Feature a large HBC signature assortment (including canoes)
-More fashion brand exclusives
- Furniture, Linens and housewares.
Queen Street
- Move Sak's and Wework out
- Give the store the full 9 floors (basement + 8) over 1.2M sq ft
- Endeavour to have it carry everything that is offered online and some in-store exclusives.
- Beef us service.
- Don't run the store to make money (that's a nice bonus), run it to drive traffic to your website.
*****
Sak's
Close:
Queen
Sherway
Open
Bloor Street (former Bay location, gutted w/new facade)
Yorkdale
Again, up the wow factor.
Nothing should be generic about Sak's (but sadly too much is)