Nordstrom Inc. says it is winding down its Canadian operations and closing all 13 of its stores in the country.
The company filed for protection from its creditors this week under the Companies' Creditors Arrangement Act, a Canadian law that manages the orderly wind-down of businesses. CCAA is akin to what's known as "Chapter 11 bankruptcy" in the United States, and it is intended to enforce rules to ensure as many funds as possible get collected, to pay back creditors as equitably as possible
Nordstrom launched in Canada in 2014. The chain has six Nordstrom stores and seven Nordstrom Rack locations.
All stores will close and all the company's staff in Canada — roughly 2,330 people — will lose their jobs, the company said Thursday.
In court filings, the company says Nordstrom's Canadian business has lost money every single year it has been in operation.
"We entered Canada in 2014 with a plan to build and sustain a long-term business there. Despite our best efforts, we do not see a realistic path to profitability for the Canadian business," the company said in a statement.
Pending approval of the court monitor overseeing the wind-down, liquidation sales at all existing locations will start around March 20.
Gift cards will be honoured until the end of liquidation for in-store purchases. No new gift cards can be purchased after Thursday.
The company's Nordstrom.ca site has stopped sales effective immediately. Any orders placed online before Thursday will be filled, but no new orders will be processed online. After March 17, all sales are final and returns and exchanges will no longer be permitted.
Retail consultant Doug Stephens says the move suggests that Nordstrom is just the latest department store chain to find its business model being squeezed on all sides — by discount brands from below and luxury brands from above, along with the rise of e-commerce.
"It's no secret that the department store channel has been in, let's call it, a pretty fragile state," he told CBC News.
It's the second major U.S. chain to pull the plug on its Canadian operations in a matter of weeks, after Bed Bath & Beyond announced in February it would close all of its 65 stores in Canada.
After years of suffering a drag on profits, Stephens says Nordstrom's U.S. parent is looking at the prospect of a recession in its home market and taking the opportunity to cut out anything that isn't adding cash to its bottom line.
"Clearly it's a move on Nordstrom's part to reconsolidate — tighten things down — and prepare for what could be a very difficult year ahead," he said.
Nordstrom closing down in Canada, shuttering all 13 stores | CBC News
The company filed for protection from its creditors this week under the Companies' Creditors Arrangement Act, a Canadian law that manages the orderly wind-down of businesses. CCAA is akin to what's known as "Chapter 11 bankruptcy" in the United States, and it is intended to enforce rules to ensure as many funds as possible get collected, to pay back creditors as equitably as possible
Nordstrom launched in Canada in 2014. The chain has six Nordstrom stores and seven Nordstrom Rack locations.
All stores will close and all the company's staff in Canada — roughly 2,330 people — will lose their jobs, the company said Thursday.
In court filings, the company says Nordstrom's Canadian business has lost money every single year it has been in operation.
"We entered Canada in 2014 with a plan to build and sustain a long-term business there. Despite our best efforts, we do not see a realistic path to profitability for the Canadian business," the company said in a statement.
Pending approval of the court monitor overseeing the wind-down, liquidation sales at all existing locations will start around March 20.
Gift cards will be honoured until the end of liquidation for in-store purchases. No new gift cards can be purchased after Thursday.
The company's Nordstrom.ca site has stopped sales effective immediately. Any orders placed online before Thursday will be filled, but no new orders will be processed online. After March 17, all sales are final and returns and exchanges will no longer be permitted.
Retail consultant Doug Stephens says the move suggests that Nordstrom is just the latest department store chain to find its business model being squeezed on all sides — by discount brands from below and luxury brands from above, along with the rise of e-commerce.
"It's no secret that the department store channel has been in, let's call it, a pretty fragile state," he told CBC News.
It's the second major U.S. chain to pull the plug on its Canadian operations in a matter of weeks, after Bed Bath & Beyond announced in February it would close all of its 65 stores in Canada.
After years of suffering a drag on profits, Stephens says Nordstrom's U.S. parent is looking at the prospect of a recession in its home market and taking the opportunity to cut out anything that isn't adding cash to its bottom line.
"Clearly it's a move on Nordstrom's part to reconsolidate — tighten things down — and prepare for what could be a very difficult year ahead," he said.
Nordstrom closing down in Canada, shuttering all 13 stores | CBC News
