If it's Canada, it's HBC!
I'm chuffed about Canadian Tire buying Hudson's Bay Company assets. Are you?
In lieu of Flashback Friday, I’m re-upping and refreshing my thoughts on the intrinsic value remaining in Canada’s venerable Hudson’s Bay Company brand – after news that Canadian Tire is seeking to buy its intellectual properties.
Ubiquitous Canadian retailer Canadian Tire will pay $30 million to acquire intellectual property, including brands, logos, coats of arms and merchandise including the legendary “Stripes” collection from defunct Hudson’s Bay Company. The company announced its intention yesterday. The purchase is subject to court approval.
I wrote a month ago that someone would be wise to do this. Chartered in 1670, HBC literally owned most of Canada before it was Canada. The Canadian retail icon had been operated by absentee American owners in recent years who seemingly sought to extract the maximum amount of value from the company’s remaining retail holdings while loading the business up with debt and refusing to invest a dime in stock, staff or escalators at any of its then remaining 96 stores. Mission accomplished. HBC went into creditor protection earlier this year and has been liquidating its assets ever since.
I believed then, and still believe, there is enormous value in the HBC brand and much of its iconic merchandise. Canada is having a moment right now. National pride and patriotism has never felt stronger in my lifetime. As Canadians raise their elbows in the face of a belligerent US Toddler-in-Chief, we applaud provincial premiers for ordering US products off liquor-store shelves, cancel US vacations and business trips, and use social media to share lists of Canadian-made essentials with which to prioritize our shopping. We are “Buy Canadian” a mari usque ad mare.
This is the wrong time for Canada’s oldest retailer (a) to be owned by Americans, and (b) to go out of business. Recent management decisions drove the company, intentionally or otherwise, into the ground. And, Canadians are almost universally pissed about it.
As I argued in March, there is a great opportunity here. Canadian Tire, apparently, thinks so too. Will we be able to by points blankets and striped umbrellas at CT retail stores everywhere? Probably. But, I hope it goes further. Much further.
Canadian Tire Corporation is a publicly traded corporation that lists its shares on the Toronto Stock Exchange. You could buy stock today for $166 and change. That’s up $5.23 (3.25%) from the previous day’s close. The market likes this deal. In fact, CTC.A shares have been trending up since mid February when people started wondering aloud whether Canadian Tire might be interested in HBC’s stores or assets.
CTC isn’t just Canadian Tire stores in every hometown across Canada. It also owns a number of other retail brands familiar to Canadians, most notably Mark’s (Work Wearhouse), SportChek, Atmosphere, Hockey Experts, Nevada Bob’s Golf, Part Source, Party City and others. It owns a financial services company (Canadian Tire Bank) and a chain of Canadian Tire Gas+ service stations. And, more importantly to my vision, sporting equipment and apparel companies including Helly Hansen and Sher-wood (of hockey stick fame). It’s a great fit for HBC brands.
I argued in March that a re-imagined HBC could be the ultimate retailer of “Canada” to the world.
I would rebuild HBC on the pillars that made it strongest: uniquely Canadian, outdoorsy, connected to the land, proud.
My HBC would focus entirely on Canadian-made products and those Canadians can use to reconnect with our nature and our heritage. I’d make it a boutique experience, with some small retail stores in shopping malls and heritage buildings across the country reminiscent of HBC trading post from its early days: the log cabin, roaring fire, bundled fur type esthetic.
I’d make it the ultimate neighbourhood store not by building these boutiques in every Canadian neighbourhood, but by putting them inside every Canadian home. A robust online shopping experience could draw from Canadian expertise like that behind global giant Shopify and lean into the ability of modern logistics to deliver products quickly and affordably from coast-to-coast-to-coast. I’d make HBC a global brand for those who love Canada, camping and outdoor sports.
If it’s Canada, it’s HBC!
I have no doubt Canadian Tire has the expertise and wherewithal to make this happen. I can see small HBC sections in existing CT stores selling points blankets and stripe merchandise, HBC-branded canoes and outdoor gear. Build this out with an online e-commerce site selling robust Canadian outdoor gear to sport enthusiasts around the world. Make it the go-to place for lacrosse gear, canoes, kayaks, snowshoes, ice fishing and trapping supplies as well as iconic Canadian items such as points blankets and stripe merchandise. Follow this with boutique shops in high-end shopping malls in major urban centres.
I hope the courts approve the sale and I hope Canadian Tire executives have imaginations as fertile, and retail acumen that far exceeds, my own.
Maybe they may even be able to produce and sell a made-in-Canada points blanket I could one-day afford to own!
What would you buy from a re-imagined HBC shopping experience?
If I needed a canoe, I'd by a cedar canoe from Canadian Tire, and some paddles with stripes'
BAK
I really hope they stick with the Made In Canada theme, and don't sell Chinese made HBC items.