Understanding Major Economic, Demographic And Consumer Trends In Canada. John Williams December 1, 2011

Transcription

1 Understanding Major Economic, Demographic And Consumer Trends In Canada John Williams December 1, 2011

2 Outline The Canadian Population Retail Growth and Influence on Real Estate The New Entrants The Technology Effect In Closing 2

3 The Canadian Population

4 Immigration is Driving Canadian Population Growth Source: Statistics Canada - Quarterly aggregated demographic components, July to September, 1975 to 2009, Canada

5 and it Will be More so in the Future Source: Statistics Canada - Migratory and natural increase of the Canadian population, 1956 to 2056

6 The Current Picture llions Mi Immigrants Population less Immigrants % Change 2001 to % 0 Source: Statistics Canada

7 And They Are Emigrating From Top Ten Places of Birth for Immigrants To Canada - (1991 to 2001 vs to 2006) 16% 14% 12% 11% 14% 12% % 9% 8% 7% 7% 7% 6% 5% 4% 2% 0% 4% 3% 3% 3% 3% 3% 3% 2% 2% 1% 1% 1% China India Phillipines Hong Kong Sri Lanka Pakistan Taiwan U.S Iran Poland Source: Statistics Canada 7

8 And Residing in Percent of Total Population Source: Statistics Canada 2006 Census & CSCA 8

9 With Projected Spending Implications of Canadian Population Growth ( ) 2,500 2,239 2,000 1,500 1, ,351 1,501 Projected Population Growth (Thousand ds) Pre-Retire ees Toddlers and Tr ri-cycles Tweens and Teens Career Spending Replacement Sp pending Active Elders Retirees < Age Cohorts Source: Statistics Canada 9

10 Retail Growth and Its Real Estate Influence

11 Canada s Retail Sales Have Held UP Sources: Statistics Canada 11

12 Store Types: Leaders vs. Laggards (CAGR ) Canada Leaders Laggards Sources: Statistics Canada 12

13 Retail Real Estate Format Growth* (Greater Toronto Area 2001 vs. 2009) 0s) Retail Floor Area (000 Growth Rate 9% 11% 78% 45% Sources: Centre for the Study of Commercial Activity Ryerson University Report * Floor Area (1,000s) 13

14 The Changing Retail Landscape New Entrants

15 The New Entrants (Apparel and General Merchandise) Apparel & Accessories 2000 Major Players Le Chateau Roots Eddie Bauer The Gap Co. Concepts Reitman s Suzy Shier American Eagle 2000 Players + Recent* + New Entrants Le Chateau, Roots Eddie Bauer Considering** General Merchandise Walmart, Sears The Bay, Zellers Walmart, Sears, The Bay, Zellers * Launched in Canada within the past 5 years ** Retailer has not confirmed entry into Canadian market 15

16 And Their Anticipated Impact. New Entrants $16 (in billions s) $7.6 }$80 *Estimated by JCWG NOTE: Retail sales for 2010 for All Stores less Automotive were over $293 billion dollars 16

17 The Target Effect An Overview 1,740 stores 120,000 sq. ft. stores Store sales = $65.6 Billion E-comm sales =$1.2 Billion* Household essentials Hardlines Apparel & accessories Home furnishings Food & pet supplies * 2010 Annual Report 17

18 Operational Overview Key Lines of Business* S.W.O.T Strengths Brand awareness Innovative Trendy/up-to-date Open multiple locations simultaneously Presentation of merchandise Carries both private~~and national brands Financially sound Can leverage online approach Will take share from WM, Winners & Sears, The Bay and Loblaws (Joe Fresh) Opportunities Extend brand Test & refine international strategy Test small format stores~ Introduce E-commerce Weaknesses Limited knowledge of market place First international market Assuming Canadians will shop in same manner as U.S. consumers Ability to obtain desired real estate Threats Will experience significant competition from established players * 2010 Annual Report ~ Set to launch small format store in Chicago in 2012 ~~ Generates ½ of revenue from Private Brands 18

19 The Technology Effect

20 High Internet Access Across All Mediums Internet Access (all locations) Perc cent (%) Home Internet Access Wireless Access Smartphone PDAs Source: Ipsos Reid 20

21 Canadians Buying More Online $16,000 $14,000 $12,772 $15,071 $15,300 $12,000 $10,000 $7,924 $8,000 $6,000 $4,000 $2,000 Source: Statistics Canada * Includes Travel $ CAGR (14%)* 21

22 Smartphone Penetration ti Increasing 1 in 3 mobile devices in Canada is a smartphone *Source: Comscore 22

23 A Glimpse of the Future 23

24 Both Sears and P&G are Also Experimenting with the Future Sears Holdings enters the future of shopping with mobile walls* P&G takes to the subways to sell goods in Prauge, Czech Republic *Source: RetailingToday.com Nov

25 In Closing

26 What Do These Individuals Have In Common? Timothy Eaton Sol Price Jeff Bezos 26

27 They Are: 27

28 Thank you. The Retail Shop. Chicago, Toronto (416) John Williams