Yahoo Finance 'You have to be patient': Why it took Simons so long to expand to Toronto
Simons’ chief executive Bernard Leblanc has been in no rush to bring the iconic Quebec retailer to Canada’s biggest city. Even as the company sets its sights on expansion in Canada, it waited patiently for the right opportunity in Toronto.
“Life is made in such a way, you have to be patient,” LeBlanc said in an interview with Yahoo Finance Canada.
After Nordstrom exited the Canadian market, opening up large retail spaces in two of the country’s busiest malls, that long-awaited expansion opportunity finally arrived for Simons. The retailer announced last week that it will spend more than $75 million to open two stores in Toronto in 2025 – one at the Yorkdale Shopping Centre and another at the Eaton Centre.
“Being more present in the Greater Toronto Area is something that was always part of our expansion plans. We were really just looking for the right opportunity to come to fruition,” Leblanc said.
“It’s really about ensuring that it’s the right location, the right space is available in the right mall… These are great locations. We couldn’t let them pass. We had to be present and build proximity with our clients in the (Greater Toronto Area).”
Now, as it gets ready to occupy the space where Nordstrom and other retailers before it have failed, Simons will have to avoid the same fate and keep Canadian shoppers coming back. Retail experts say the company is set up to do just that.
“Simons being in the graveyard of old department stores serves as a warning, but also some valuable insight. Many department stores have really struggled to gain a stronghold in the Canadian market,” said Jenna Jacobson, an associate professor at Toronto Metropolitan University’s Ted Rogers School of Management, focusing on retail management.
“Simons is different. They have a strong story, a strong brand, and a focus on sustainability… The challenge is always how to stay relevant with changing customers.”
Simons has 'a better chance', says expert
Leblanc draws a distinction between Simons and the retailers that previously occupied its soon-to-be Toronto locations.
“We’re not a department store,” Leblanc said.
“We’re organized around various experiences that are focused on very specific target audiences.”
Leblanc says 70 per cent of Simons’ product assortment is exclusive to the retailer.
“We develop products that bring a combination of good quality, avant garde fashion at an accessible price point. That’s part of our unique offering,” Leblanc said.
“We combine that with national brands and well-recognized local and international brands to provide an offering for our customers that can’t really be found anywhere else other than at Simons.”
Retail analyst Bruce Winder says Simons’ product assortment is an advantage for the company, and helps set it apart from department stores like Nordstrom and current competitor Hudson’s Bay Company.
“I think they do have a better chance than the old department stores. They don’t have as much baggage as department stores,” Winder said.
“The margins they are going to make are much bigger, and when you add in the private label mix, it’s going to be a lot bigger. They have the horsepower from a margin standpoint to make the higher rents work, and they have avant garde designs, which I think will appeal to a lot of people who live and play in downtown Toronto.”
Simons has 17 stores across the country, the bulk of which are in Quebec, where the company was first founded back in 1840. The fashion and home goods retailer has just two locations in Ontario – in Ottawa and Mississauga – but says it has seen steady growth at those stores, with sales growing by more than 3 per cent in Mississauga. Although it doesn’t have any physical stores in Toronto just yet, the GTA is Simons’ second-biggest market when it comes to e-commerce.
While Simons is certainly not a new player in the retail industry, its brand recognition is undoubtedly stronger in Quebec than it is in Ontario. But Leblanc doesn’t see that as an obstacle to the expansion.
“We are investing heavily in continuing to build brand awareness and continuing to gain market share outside of Quebec,” he said.
“What better billboards than having a beautiful Simons presence on the corner of Yonge and Dundas, and having a beautiful Simons right along the 401, with hundreds of thousands of passenger cars passing every day?”
Alicja Siekierska is a senior reporter at Yahoo Finance Canada. Follow her on Twitter @alicjawithaj.
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