Winners makes 'Sense' of Canada's home market - Winners Merchants Inc. sets up HomeSense division - Brief Article

DSN Retailing Today, March 6, 2001 by Jim Fox

TORONTO -- Canada's lucrative home goods market is attracting more players as Winners Merchants Inc. comes out of the clothes closet to offer merchandise for the entire home.

The off-price clothing retailer, a division of TJX Companies of Framingham, Mass., is launching the HomeSense chain in Canada. The first two 25,000-sq.-ft. stores are to open next month in Brampton and Ancaster, Ontario, near Toronto. HomeSense will be modeled and merchandised after HomeGoods, an 80-store division of TJX that is expected to grow to 120 U.S. stores this year.

Seven HomeSense stores are expected to open this year in Canada, with three additional openings in May in Woodbridge, also near Toronto, as well as in Ottawa and Kingston. The seventh will open in the Toronto area in the fall. Another eight stores are planned for next year, with 10 more across the country in 2003. "Ultimately, we believe Canada can support 60 to 80 HomeSense stores," said David Margolis, president and founder of Winners' 117 stores. In five or six years, he suggested HomeSense would be a $500 million (US$325 million) business.

The HomeSense chain "represents a significant retail trend," Margolis said, noting stores will combine "great brands and outstanding quality" at 20% to 60% lower than regular department store or specialty store prices.

Over the past several years, Winners has been offering increasing amounts of home products, amounting to about 18% of the volume. Margolis, who founded Winners in 1982 and sold the five-outlet chain in 1990 to TJX, said the time is right for the chain in Canada.

The country's $5 billion (US$3.25 million) home decor market has seen double-digit growth in the last four years.

With the low value of the Canadian dollar, U.S.-made brand goods in full-price stores have become more expensive, resulting in more Canadian bargain hunters, he said. These trends have made a winner out of the Winners stores, where annual sales have reached US$850 million, with plans for another 15 outlets to open this year.

HomeSense will sell such things as Indonesian end tables, handcrafted Oriental rugs, Italian ceramics and top North American brand names. The stores will carry a wide selection of home products, ranging from cookware to linens, rugs, accent furniture and seasonal items.

The merchandising concept is "a home fashions store, offering a large, rapidly changing selection of quality brand name and designer home fashions and accessories at prices consistently below department and specialty store prices. The store features a tremendous selection of home fashions, accessories and giftware, as well as unique, decorative accent pieces," a news release said.

The merchandise assortment will be bedding, bath products, home decor, house-wares, accent pieces, gifts and collectibles, seasonal, garden and home office. Planned is "very fast product turnover" with merchandise moving in and out of HomeSense stores "at the same rapid pace that we achieve at Winners."

The Canadian customer profile is primarily women aged 20 to 60 with a middle- to upper-middle income who know value and recognize quality brand names.