Reitmans says it's not worried by arrival of Target
Shopping baskets are stacked at a Chicago area Target store Wednesday, May 20, 2009. (AP / Charles Rex Arbogast)
The Canadian Press
Published Thursday, September 20, 2012 12:38PM EDT
MONTREAL -- Women's clothing retailer Reitmans says it's not worried about Target coming to Canada.
Chief executive Jeremy Reitman says they've withstood increased competition from U.S. companies before, pointing to Walmart and The Gap.
Reitman says industry observers have previously predicted increased competition would cause the demise of Canada's largest publicly traded apparel company.
But he says Reitmans has done well as the popular U.S. chains have driven traffic to malls and big box outlets where its retail network operates.
Reitman is telling a CIBC investor conference in Montreal that "we thank God for Walmart."
He adds many of its various retail store brands are located in the same shopping areas.
Target will replace Zellers stores, which Reitmans said doesn't generate much traffic.
Like many apparel companies, Reitmans has faced the challenges of a tough economic environment and higher fuel and food prices that reduce discretionary spending on non-essential items.
Its revenues and profits fell in the second quarter and it says that the third quarter will be affected by problems with a new warehouse management system at its distribution centre that caused two weeks of delays in product shipments to stores.
The computer crashes were harmful but the new system will allow Reitmans to dramatically cut the time to process merchandise and allow it to do so with far few employees.
In addition to adding and refurbishing stores, Reitmans has launched an e-commerce business that allows customers to shop online and have products delivered to their homes or the nearest retail store.
Reitmans has 925 stores in Canada, under the Reitmans, Smart Set, RW & CO., Thyme Maternity, Penningtons and Addition Elle banners.
It also provides Thyme Maternity apparel and accessories for sale in 160 Babies R Us stores in the United States and 18 locations in Canada.
On the Toronto Stock Exchange, its shares lost four cents at $12.98 in morning trading.