age of 338, the Hudson’s Bay Company is looking remarkably sprightly these days. When U.S. private equity firm NRDC Equity Partners snapped up the dowdy retailer last month, it vowed to “recreate” the retail landscape—and they’re off to a quick start. This week the company appointed Bonnie Brooks, a respected Canadian executive with experience at Holt Renfrew and a luxury Hong Kong retailer, to head HBC’s Bay division. Mark Foote, who spent two decades at Canadian Tire and Loblaw Cos., has been named head of Zellers. And prior to that, Jeffrey Sherman, the former president of Polo Ralph Lauren, was named CEO of HBC. “They’re on a roll,” says Hermann Kircher, a retail consultant in Toronto. “There will be notable changes within the next 12 months.”
We’ve heard this before, of course. When U.S. financier Jerry Zucker bought HBC in 2006, many thought he’d quickly trim the business. But HBC plodded along until Zucker’s death from cancer in April. Things seem different now. Kircher sees HBC selling its Home Outfitters and Fields chains. The company also plans to build larger Zellers stores and may split the smaller stores into a separate company. That could make Zellers more appealing to U.S. retailer Target.
More big changes will come to the Bay, too. NRDC, which owns Lord & Taylor in the U.S., will bring the high-end chain to Canada by replacing prime Bay locations, or creating hybrids of the two chains. Lord & Taylor will be positioned a notch below Holt Renfrew, while the Bay will move upmarket. Some Bay stores will likely close outright, says Vancouver retail strategist David Ian Gray.
“It’s been hard for the people who invested in HBC to let go,” Gray says. “The new guys are going to bring more of an aggressive approach to what reinvention might look like.” M
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