Sears Canada
 | |
 The former flagship store and headquarters at Toronto Eaton Centre; the store closed in 2014, and the headquarters closed in 2018 | |
| Formerly | Simpsons-Sears (1952–1984) |
|---|---|
| Company type | Public |
| Expert Market: SRSCQ | |
| Industry | Retail |
| Founded | 1952 |
| Defunct | January 14, 2018 |
| Fate | Bankruptcy and liquidation |
| Headquarters | Toronto Eaton Centre Toronto, Ontario, Canada |
Key people | Brandon G. Stranzl (Executive Chairman until October 16, 2017[1])
Herbert Becker (Chief Financial Officer)[2] |
| Products | Clothing, footwear, bedding, furniture, jewellery, beauty products, appliances, housewares, tools, electronics and toys |
| Revenue | $3.146 billion (2015)[3] |
| -$67.9 million (2015)[3] | |
| Total equity | $554.2 million (2015)[3] |
Number of employees | 58 (April 2018)[4] |
| Parent | Simpsons (1952–1983) Sears (1952–2005) Sears Holdings (2005–2018) |
| Website | www |
Sears Canada Inc. was a publicly-traded Canadian company affiliated with the American-based Sears department store chain. In operation from 1952 until January 14, 2018, and headquartered in Toronto, Ontario, the company began as Simpsons-Sears—a joint venture between the Canadian Simpsons department store chain and the American Sears chain—which operated a national mail order business and co-branded Simpsons-Sears stores modelled after those of Sears in the U.S. After the Hudson's Bay Company purchased Simpsons in 1978, the joint venture was dismantled and Hudson's Bay sold its shares in the joint venture to Sears; with Sears now fully owning the company, it was renamed Sears Canada Inc. in 1984. In 1999, Sears Canada acquired the remaining assets and locations of the historic Canadian chain Eaton's. From 2014, Sears Holdings owned a 10% share in the company.[5][6] ESL Investments was the largest shareholder of Sears Canada.
In 2016, Sears Canada had a network that included 140 corporate stores (including full-line, Sears Home, and Sears Outlet stores), 71 Hometown stores, over 900 catalogue, and online merchandise pick-up locations, 69 Sears Travel offices, and a nationwide repair and service network. The company also published a general merchandise catalogue until the last quarter of 2016 and offered shopping online at sears.ca until October 19, 2017.[7]
After filing for creditor protection in June 2017, Sears Canada announced it would close 20 full-line locations, 15 Home stores, 10 Outlet stores, and 14 Sears Hometown stores.[8] The closings resulted in 2,900 employee layoffs.[9] These stores officially closed on Sunday, October 1, 2017.[10] In September 2017, Sears Canada announced the closing of 10 additional stores, in addition to the 59 store closings previously announced in June.[11] On October 10, 2017, Sears Canada announced that it would seek court approval to shutter all of its remaining stores in Canada and lay off 11,240 remaining staff.[12] The approval was granted by the Ontario Superior Court on October 13, 2017.[13]
Liquidation sales began on October 19, 2017. The remaining Sears stores closed on January 14, 2018. Store fixtures and equipment from the closed stores were sold until January 26, 2018.[14][15]
History[edit]
 | This section needs additional citations for verification. (July 2021) |
Operations during 20th century[edit]
Simpsons-Sears[edit]
Sears Canada began its operations as Simpsons-Sears Limited, a catalogue and mid-market suburban retailer that was a joint venture between the Robert Simpson Company Limited, a Canadian department store chain, and Sears, Roebuck and Co. of the United States. In 1952, Sears Chairman General Robert E. Wood sent a letter to Simpsons President Edgar G. Burton, proposing a partnership between their two companies in order to serve the Canadian market. The deal to create Simpsons-Sears Limited, a Canadian catalogue and department store chain separate from the Simpson's chain, was signed on September 18, 1952. The new company would be a 50–50 partnership; Simpsons and Sears both invested $20 million and had equal representation on Simpsons-Sears' board of directors. The new company had two main objectives: to expand Simpson's mail-order business (which was sold to the new company) and to build a string of stores modelled on Sears' format across the country.
The agreement also contained a provision that would become a major challenge in later years. Under its terms, Simpsons-Sears could not open a retail store within 25 miles of Simpsons' existing stores in Toronto, Montreal, Halifax, Regina, and London. In return, Simpsons promised not to build any stores outside of those five cities. Simpsons-Sears' mail-order business, however, was free to operate anywhere in Canada, as was the new Simpsons-Sears Acceptance Company, the credit arm of the operation.
The business operations of Simpsons-Sears began when the first Simpsons-Sears Spring/Summer Catalogue was printed by Photo-Engravers and Electrotypers, Ltd. and delivered to 300,000 Canadian homes in early 1953. On September 17, 1953, the first Simpsons-Sears retail store opened in Stratford, Ontario; the second store opened in Kamloops, British Columbia in December of that year. In 1954, Simpsons-Sears opened Canada's first large suburban department store, in Vancouver – Burnaby, BC, based on new the modern Sears, Roebuck model, spreading across the U.S.
Simpsons-Sears introduced the slogan “We Service What We Sell” in 1955, backed up by a highly trained nationwide corps of service technicians.
In 1963, Simpsons-Sears opened its first full-line store in Quebec, in Quebec City's Fleur de Lys complex.
The company made its public debut on the Toronto and Montreal stock exchanges on April 5, 1965, with the listing of its Class “A” non-voting shares. That year, Sears began its long-standing partnership with the Boys and Girls Clubs of Canada, to support its youth programming.
In 1968, Simpsons-Sears became the first Canadian retailer to begin buying products from Mainland China.
In 1971, Simpsons-Sears opened a new head office building in downtown Toronto.
In 1972, Simpsons and Simpsons-Sears agreed to end the 25-mile restriction and permit Simpsons and Simpsons-Sears stores anywhere. The following year Simpsons-Sears opened a store in the city of Mississauga, approximately 30 km (19 mi) west of Toronto. To avoid confusing customers used to Simpsons, new stores were opened under the "Sears" banner. All existing Simpsons-Sears stores were rebranded to the Sears banner as well. However, the name of the company remained Simpsons-Sears Limited.
Also in 1973, Sears hit $1 billion in sales.
In 1974, Simpsons-Sears opened a Sears store at Hillcrest Mall in Richmond Hill, Ontario, its first location in a mall that had a Simpsons store.
Divestiture by Simpsons[edit]
In 1978, Simpsons and Simpsons-Sears put forward a plan to merge their businesses. This plan had to have the approval of the Foreign Investment Review Agency, as Sears, Roebuck would become the prime shareholder. Before approval could be attained, the Hudson's Bay Company made a counter bid and acquired Simpsons Limited. Simpsons' shares in Simpsons-Sears taken over by The Bay were eventually sold back to Sears, Roebuck. The company was renamed Sears Canada Inc. in 1984 to reflect its independence.[16]
The paths of Hudson's Bay and Sears crossed again in 1991. The Hudson's Bay Company merged its remaining Greater Toronto Simpsons stores into its The Bay division in 1991, and the Simpsons name disappeared from Canada's retail landscape. As a result of this move, Sears Canada took over eight former Simpsons and Bay stores and finally gained a major foothold in Greater Toronto, a market from which it had been excluded by the 1952 agreement with Simpsons. These new stores featured a new 60:40 fashions; hardlines mix and introduced new boutique shop arrangements and fashion lines, such as Le Chateau, Sung, and Rouie.
Sears announced, "The Store of the Future" in 1983. It represented a complete transformation and remodelling of stores along a new product-focused and customer-friendly merchandising program. The first remodelled store, in Mississauga, Ontario, was unveiled in 1985. Stores would be fully retrofitted over the following three years.
The Sears Catalogue Club points program began in 1986. The next year, it changed to "Sears Club" to incorporate all the company's trading channels. The points of the program could no longer be earned from June 22, 2017.
Acquisition of Eaton's[edit]
In 1999, Sears Canada acquired the assets and the trademark name of the bankrupt chain The T. Eaton Company Limited. For the first time in its history, Sears Canada gained the leases to a number of prime downtown locations in Toronto (Eaton Centre), Vancouver, Victoria, Winnipeg, Ottawa, and Calgary, all former Eaton's flagship stores. The Simpsons-Sears agreement had largely shut out Sears from the urban core, and that remained so even when the restriction was lifted, as The Bay and Eaton's long held a duopoly in the downtowns of major Canadian cities. Sears Canada had also entertained notions of obtaining the former Eaton downtown Montreal store but that location was eventually occupied by Quebec retailer Les Ailes de la Mode.
Operations during 21st century[edit]
2000–2009[edit]
Sears relaunched "Eatons" (rendered with the lowercase "e" logo) in November 2000 as a seven-store upscale mini-brand, with locations in Vancouver, Victoria, Calgary, Winnipeg, Toronto (Eaton Centre and Yorkdale) and Ottawa, all of which had been flagship Eaton stores. At Yorkdale and Winnipeg's Polo Park, this meant that Sears Canada managed two anchor stores (Eatons and Sears) in those malls for a short time. This operation was unsuccessful, however, and Sears converted the Eatons stores to the Sears brand in 2002. Many said[who?] that the Eatons stores were too upscale and/or too thinly scattered across the country for the mini-chain to have ever been profitable and worthwhile. The retail environment has changed with more of the population shopping at big box outlets and specialty stores squeezing out the middle market which is the base of the traditional department store.[17]
In 2005, Sears Card financial services were outsourced to JPMorgan Chase.[18] Sears received C$3 billion for the sale, and the Sears Club points system was retained by the retailer. Sears also paid a special dividend upon the completion of the transaction. CEO Brent Hollister said that the move would allow Sears to refocus on its retail operations. Sears Canada announced it would end its credit card partnership with JPMorgan Chase when the agreement expired in November 2015.[19]
In January 2006, Sears Holdings, the parent company and majority shareholder of Sears Canada, made a bid to purchase the remaining shares to take the company private. Some members of the board opposed the move. A ruling by the Ontario Securities Commission, made in August 2006, stalled progress the attempted privatization by its parent company, Sears Holdings Limited.[20] While the ruling did not dispel the future possibility of the privatization of Sears Canada, it posed a significant obstacle by ruling three major shareholding blocks ineligible to vote as the blocks were given extraordinary privileges by Sears Holdings Limited.[21] On November 14, 2006, Sears Holdings' move to privatize Sears Canada at a bid of $17.97/share fell through by voting amongst the minority shareholder groups.[22] On March 31, 2005, the majority ownership stake was transferred to Sears Holdings, which then owned 73.1% of Sears Canada common shares, while Pershing Square Capital held 17.3%, and the remainder of the shares were publicly traded on the Toronto Stock Exchange.[23]
On September 26, 2007, Sears Canada announced the sale of its 222 Jarvis Street headquarters to the Government of Ontario. The company relocated its head office to surplus space at its flagship store in the Toronto Eaton Centre.[24]
2010–2016[edit]
Same-store sales were down 4% in 2010, compared to 6.8% in 2009.[3][25] In December 2011, after slow sales over the holiday season, Sears laid off 70 employees from its head office after losing nearly $47 million in the previous quarter. Through 2003 and into 2011 the company lost $1.6 billion in revenue.
In June 2011, Calvin McDonald, formerly of Loblaw Companies, was named president and CEO of Sears Canada. McDonald planned to restructure the company's operations under a three-year plan, in the wake of increased competition and economic uncertainties. He explained that "we are in the situation that we are in because we stopped doing the things that make great retailers great. We traded ourselves into this challenge and we will trade ourselves out of it." The company had posted a $44.1 million loss in 2010 but had recovered to $21.9 million by the third quarter of 2011. Among the planned changes were to build upon market segments where Sears had historically performed well (including appliances, dresses, children's wear and related products, and mattresses), and introduce a new store format with a more "engaging" layout.[26] In 2012, Sears sold three stores in Calgary, Ottawa, and Vancouver (Chinook Centre, Rideau Centre, and Pacific Centre) back to Cadillac Fairview for $170 million.[6] Sears also sold its Deerfoot Mall location in Calgary, as well as its locations at Square One Shopping Centre and Yorkdale Mall.[27] Sears Holdings also distributed shares in the company to Sears Canada's shareholders, reducing its holdings to 51%. Sears Holdings Corporation's chairman and CEO, Edward Lampert, has a 27% stake in Sears Canada.[6] In April 2013, the company began to scale back some of its product offerings, dropping electronics and window coverings, and making toys online-only.[28]
In September 2013, Douglas C. Campbell took over as Sears Canada's COO.[29] The following month, Sears Canada announced that it would close five of its major urban stores and sell them back to their respective landlords, including its flagship Toronto Eaton Centre location, as well as two other locations in Toronto, one in London, and one in Richmond, British Columbia. Campbell explained that "Unlocking the value of assets is one of the three levers we have said we will use as a way to create total value for the company. When proposals such as this one are presented to us, we must weigh the value of the transaction against the value we will obtain from continuing to operate those stores in their current locations".[27]
Campbell left Sears Canada in October 2014 and was replaced by Ronald Boire, who served until June 2015. Brandon Stranzl was appointed executive chairman in July 2015, continuing in his role as chairman of the board and also assuming the duties of the CEO. In November 2015, Carrie Kirkman was appointed president and chief merchant, a role she held until July 2016.[30]
In late 2013, SHS Services Management, a Markham, Ontario-based contract partner, went into receivership, but Sears Canada promised to honour home improvement warranty through services offered by SHS on behalf of Sears Canada.[31]
