Centretown retailers say they are not afraid of the red and white, but retail officials and U.S. merchants warn that Target – recognized worldwide by its two-tone bullseye logo – is not to be ignored.
“I actually rent a car when I go shopping at Target,” says Megan Quirolo, the manager of Azalea, a high-end women’s clothier in downtown San Francisco.
“In San Francisco we’re all aware of the evils of Wal-Mart and Target, but everyone still goes and buys a lot.”
Target takes a bite out of businesses not adapted to a competitive market, she says.
The discount department store has 1,752 locations in 49 U.S. states. It’s coming to Canada after taking over the leases of 220 Zellers stores – including one in Centretown – in a $1.8-billion deal with Zellers’ parent, Hudson’s Bay Company.
But big-box department stores simply don’t fill the niches small businesses do, says Avo Kabakian, owner of Shoe Box, in business on Sparks Street for 30 years.
“I know that they’re like Zellers, and so I know that I will be OK,” says Kabakian about Target.
Although Target has not yet revealed which Zellers stores it will occupy, between 100 and 150 will operate under its banner by 2015.
Centretown’s only Zellers is nestled on the corner of Sparks and O’Connor streets.
The two-storey department store is smaller than most other locations.
The building boasts heavy antique wooden doors inset with glass and finished off with brass hardware.
Target’s arrival in this location would be a disappointment rather than a threat, says Alicja Postolek, owner of a women’s boutique on Sparks Street.
“We have enough of the Tim Hortons and Wal-Mart kind of stuff in Ottawa,” she says.
Postolek agrees with Kabakian – Target’s big box concept can’t compete with niche-filling small businesses.
She adds that her prime downtown location, teeming with tourists and workers on lunch breaks, will also help to keep her out of Target’s crosshairs.
This same hustle and bustle environment will be bad for Target, says Postolek.
“It’s not the young family type, trying to pay the mortgage and pinch pennies who live around here,” she says.
But Quirolo insists Target is not just in competition with discount department stores.
“People who shop high-end will also shop low-end,” she says, adding that Target has an advantage in its high-end looking cheap-chic products.
“With clothes, people will mix cheap jeans and under-layers with a $300 sweater.”
Target’s items meld pretty seamlessly into a nice outfit, she says.
Canadian retail officials say they’re sure Target will be a hit with Canadians.
The store’s cheap-chic concept is appealing to consumers, says Bob Kirke, the executive director of the Canadian Apparel Federation.
The secret, he says, is in the merchandising.
Target offers a shopping experience that focuses on being just a little bit better than the average department store.
“Unlike Zellers, you can actually walk down the aisles of a Target without stuff falling onto you,” says Kirke.
Target will gain most of its market share from Sears and Zellers, he adds, but all retailers will be affected.
Small businesses will just have to raise the bar in order to compete, says Ralph Moyal, president of the Retail Merchants’ Association of Canada.
If nothing else, says Kabakian, a Target in Centretown will draw people curious about a new store downtown to shop.
“A little bit of competition over price is good. It’s all good,” he says.