Nordstrom’s retreat from Canada points to company-specific issues as well as wider challenges in a beleaguered retail sector still recovering from the pandemic, according to retail analysts.
points to company-specific issues as well as wider challenges in a beleaguered retail sector still recovering from the pandemic, according to retail analysts.
Retail analyst Bruce Winder told BNN Bloomberg Thursday that he wasn’t surprised by Nordstrom’s exit, given the company’s difficult past year in the U.S. and the smaller Canadian market posed challenges for its luxury department store model. “Canada really didn’t need this,” he said. “This sends a shockwave through the whole industry, and the whole real estate sector as well.”The transition will be difficult for the 2,500 Canadian Nordstrom employees affected by the company’s wind-down, Winder said. The retail sector has been hit particularly hard the last few years, he said, as public health measures limited in-person shopping and strained business’ bottom lines.
Canada was also subject to longer pandemic-related business shutdowns, said Dana Telsey, CEO and chief research officer at Telsey Advisory Group, and retail has been slower to recover than in the U.S. as a result.Tesley said slower recovery from COVID-19 in Canada may have factored into the company’s decision to focus more on its much larger U.S. market.
“The issue in Canada is really just a small issue compared to Nordstrom is much bigger problems,” he said. “I think the management thought that the expansion into Canada was really more of a distraction.”
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