Can Canada’s oldest retailer hang on?

From fur trading to e-commerce, the oldest and most resilient retailer in Canada has been the Hudson’s Bay Company (HBC) since 1670.

The company’s roots go back so far, they pre-date Confederation by nearly 200 years.

If ever there was an example of reinvention, over and over again, it will never be said that this retailer went down without a fight.

Behind on the bills

The namesake department store of HBC is most commonly known as The Bay.

They have been in the news a lot this past year for failure to pay their rent in shopping malls across Canada.

The Bay, like many retailers, have reportedly not paid rent since the Covid-19 pandemic began last Spring.

An Ontario judge ordered HBC to pay at least half the rent owing to one of their many landlords in mid-November which staved off eviction at that time.

However, on the west coast, Coquitlam’s Centre Mall locked the doors on the retailer just prior to the Black Friday weekend sales. They have since reopened.

HBC has 120 Canadian stores including Coquitlam. Filed court records state $20 million a month in leases have not been paid to eight landlords alone.

Sharing the burden

In a rare move, HBC has been suing their landlords back.

They argue that Oxford Properties, operating Toronto’s Yorkdale mall, failed to run a first-class mall this past year and deem the lease to be in default.

Ditto on their leased premises in Coquitlam.

HBC has publicly maintained they believe all landlords and tenants should share the burden of the disruption of business due to the pandemic.

Despite the rental arrears, there is no doubt their landlords are considering ways to keep The Bay in place given the fallout many faced when Sears and Target went down so abruptly.

Large department store footprints were not easily backfilled during sunnier economic times. This would be ever the more daunting now.

Opportunity knocks

HBC went private as a corporation just prior to the pandemic with promises to turn around already struggling sales, outside of public scrutiny.

In preparation for that plan they closed down their Home Outfitters division in July 2019 despite having substantial term left on some of their leases.

HBC went to market to sublease those properties, but some analysts are speculating that HBC is using the pandemic to wiggle out of continuing to pay on those commitments.

The pandemic has also sped up planned closures, such as The Bay flagship in Winnipeg.

Plans were in place to close in February 2021, but doors were quietly shuttered as of November 30.

Retail dinosaurs

It seems the Bay may be destined to join history footnotes behind other retail stores of yore.

After 130 years, the T. Eaton Company Limited went bankrupt in 1999. Eaton’s controlled 60 per cent of all department store sales in Canada on one time, down to a meager 10.6 per cent by the end.

Sears Canada hung on a bit longer, only stopping their catalogue service in 2017.

But they too finally bit the dust in January 2018 and were replaced by a food court in Saskatoon’s Midtown Plaza.

But these stores were merely babies behind the 350-year-old Hudson’s Bay Company.

Let’s hope the pandemic is not the final nail in this beloved Canadian retailer’s coffin.

Posted by Kelly Macsymic

Ps. Barry just loves my FUN facts (which are rarely fun) but here are just a few bits I found super interesting on the Hudson’s Bay Company Wikipedia:

  • The Hudson’s Bay Company was granted a monopoly over the region drained by all rivers and streams flowing into Hudson Bay in northern Canada through a royal charter from King Charles II.
  • Hudson’s Bay Company’s first inland trading post was established by Samuel Hearne in 1774 with Cumberland House, Saskatchewan.
  • Between 1820 and 1870, HBC issued its own paper money.
  • Louis Riel Sr led a crowd of armed Metis men to the trial of Pierre Guillaume Sayer in 1849, which contributed to the end of the HBC monopoly.
  • The first of the grand “original six” department stores was built in Calgary in 1913. The other department stores that followed were in Edmonton, Vancouver, Victoria, Saskatoon, and Winnipeg.
  • The Saskatoon store was torn down in 1960 and replaced with a modern three storey building on the same site, which was converted to residential lofts in 2004.
  • HBC revenue was listed at $9.4 billion in 2018.

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