March 31, 2015 | In: Opinion
In case you haven’t heard that already, Best Buy decided to close all FutureShop stores in Canada. 50% of the FutureShop stored are to be rebranded as Best Buy, while the rest are closed indefinitely. In my opinion, that move was very expected. Let me tell you why…
A couple of weeks ago, I went to Centre Laval with my family (Laval is an island about 30 minutes North of Montreal). Centre Laval is a retail compound where you can find a store of nearly any retail chain operating in Canada. My wife took my daughter to a pet store so that she can see some animals, while I wandered around. About 30 minutes later, I called my wife and told her that I’m waiting for her in Best Buy. 10 minutes later she called me and asked me where I was because she was at Best Buy. I looked around, and it didn’t take me long to realize that I was in FutureShop, and not at Best Buy. Yes – that’s how similar these 2 places are – owing to the fact that Best
Buy owns FutureShop.
At that time, I asked myself, what’s the point of having a Best Buy and a FutureShop within a walking distance of each other (often the walking distance is a few minutes), when they belong to the same company and when they sell the same stuff for exactly the same price? Not to mention, of course, that in both places, the employees outnumber the clients by around 10 to 1 (there was around 20 employees in both places and there was only me and another shopper). When I saw my wife, I told her that FutureShop’s days are numbered, and so are Best Buy’s. In a few months, Best Buy will have no choice but to start restructuring its business in Canada and it will have to close all its under-performing stores (I would say about 70% to 80% of its stores)
But what about Staples which is mentioned in the title of my post? Staples, in my opinion, is slightly in a better position than Best Buy’s but it will also have no other option but to close the majority of its brick and mortar stores in Canada. There are many reasons for this: Bad store management (I noticed that most managers in Staples are mean, despite the fact that the employees are not), Amazon’s expansion, and the declining Canadian Dollar. The major advantage that Staples has is that it caters for businesses (unlike Best Buy which typically caters for super-frugal individuals) – but that advantage cannot be used as a case for keeping the brick and mortar stores, since most businesses buy online. At one point, Staples will discover that its online business is subsidizing its brick and mortar stores, and when they discover that, they will start closing stores like crazy…
I am worried about the retail sector in Canada, which provides employment for many Canadians. The thing is, as my barber told me when I asked him if I was losing hair, “we can’t stop progress”.
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