Analysis: Holt Renfrew to Close its Smaller Stores Amid Increased Competition
Holt Renfrew will close two small locations early next year, and we think that more Holt Renfrew store closures could follow. The company will instead concentrate on operating larger locations in just five Canadian cities. This strategy could be in response to expected competition from Saks Fifth Avenue and Nordstrom, both opening Canadian locations over the next several years. It appears that Holt Renfrew's strategy is to build stores in excess of 100,000 square feet, calling into the question the future of two Holt Renfrew locations not discussed in other media sources.
"Craig Patterson, an analyst who runs the online news magazine Retail Insider, said the company is consolidating stores in anticipation of losing market share to U.S. luxury retailers.
Patterson says Holt Renfrew’s planned expansion is likely a direct response to the impending arrival of Saks Fifth Avenue, which carries similar merchandise.
“Saks really plans to up its game in Canada. When it builds its Canadian . . . (stores) it says its going to be more luxurious than their current American locations,” Patterson noted.
“I think that Holt Renfrew has two things going for it. It’s got a strong brand awareness among many wealthy Canadians and brand loyalty. And it does have some vendors that (others don’t) have and probably wouldn’t be able to keep,” he said.