Liquidation sales began on Monday morning, except six of the Hudson’s Bay locations, since the company continues to look for a way to restructure.
An Ontario judge gave permission to the oldest company in Canada on Friday to start cleaning the inventory in most stores, a process that begins today and is expected to end before June 15.
After the end of liquidation sales, the company will vacate these locations before June 30. All programs and loyalty points have been suspended, leaving around 8.2 million members of Canada with approximately $ 58.5 million in unused points, but gift cards can still be used in stores until April 6.
Online sales through Thebay.com will continue until April 15. All products sold in a liquidation sale are the final sale.
The six stores currently omitted of the liquidation include three locations in Quebec and three in Ontario, including the flagship store on Yonge de Toronto street, a location in the Yorkdale shopping center in the city, and one in Richmond Hill, Ontario, as well as locations in the center of Montreal, in Carrefour Laval and in Pointe-Claire, Quee.
While these six stores can have continuous regular sales as part of their normal operations, they do not have the mandate to eliminate their inventory in the same way as the stores that are settled.
The liquidation occurs after the company requested the protection of creditors earlier this month, admitting that they were fighting with financial difficulties due to a series of factors, including a drop in traffic of the center after the pandemic, and that some payments had already postponed to the owners.
Hudson’s Bay operates 80 stores, as well as three Saks Fifth Avenue stores and 13 Saks of the fifth location in Canada through a license agreement.
Officially ongoing liquidation
Hudson’s Bay’s lawyer, Ashley Taylor, said Friday that the company was allowed to save six stores at the moment because recent sales have exceeded the company’s expectations, paving the way for the continuous operation of those stores as they pay the provisional financing.
As the media reports stirred on the 355 -year -old company that faces a potential extinction, buyers have been going mass to stores to hook products stamped with the iconic stripes of the company. Judicial documents showed that the company won $ 21 million in sales between March 8 and 14, exceeding its own estimates at approximately $ 7.4 million.
But while the term “settlement sales” can bring great discounts, it is unlikely that buyers see huge price drops on Monday as the process begins. Although it will vary according to the type of product, it is likely that sales begin at about 20 percent discount and will grow more as the weeks go by.
Buyers are struggling to collect memories of Hudson’s Bay after the company obtained approval to start settlement sales, except in the six stores next week. The flagship store in the center of Toronto is among the survivors.
A buyer who goes to reach the liquidation prices in a location of Toronto Hudson’s Bay in the city center of Scarborough told CBC News that he felt a bit “disappointed” for not seeing large sales numbers.
“I thought everything would be configured and liquidated, and there would be some good offers. But it was like an occupied on Monday mornings in the bay on a normal day,” said Joanne Chwalek, and added that it was “sad” to see the department store fading.
“I have an old Manta of Hudson’s Bay at home, so it is definitely part of our inheritance.”
6 stores that cling to life
The court order allows the company to eliminate more stores of its liquidation if you get funds, but it also allows the six stores to save themselves to the settlement if a plan to restructure, which has not yet been established, does not solidify quickly.
Hudson’s Bay successfully restructure in a significant way is “definitely a long shot,” according to David Ian Gray, an instructor in retail studies at the Capilano Business School.
“My understanding at the end of last summer was 20 to 30 [stores] They still got profits, but that is a fraction of the 80s, plus licensed stores, “he said.” That means that most of them are not profitable and have not been profitable for some time and have accumulated immense amounts of debt. “
Andrew Hatney, a lawyer for Hudson’s Bay employees, told CBC News on Friday that six stores that are saved do not help many of the more than 9,000 employees in the cutting block.
Although employees in these places still have a job for the meantime, “there is no plan for those stores,” he said.
“They have a very short time window. Those are the words they used … how it turns out that this is a great stranger.”
For locations that undergo settlement sales, some employees can be maintained to help with sales, he explained, providing some short -term income.
“But after this, the shelves are naked and those shelves are sold, we hope that all these employees lose their jobs.”
The Ripple effect extends beyond direct employees who face a loss of imminent work. In urban areas of high traffic, some owners who currently house Hudson’s Bay locations can find a new tenant quickly, Gray said. But the smallest communities in Canada, where Hudson’s local bay could have been the largest departments, may have more difficulties when stores close.
“That could be the only game in the city and an important employer,” he said. “They could be living the loss for some time. But they have passed it with Sears, they have passed it through Eaton and we move on.”
