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IKEA opens Kleinburg DC

19 September 2019

KLEINBURG, Ontario – IKEA Canada has brought its new 550,000 square foot customer distribution centre here online. Created in partnership with logistics giant DHL, the retailer said it will further its ability to have its products in the right place, closer to its customers while providing increased capacity for future growth.

“Today's opening in Kleinburg is an important step as IKEA Canada continues its transformation journey to become the leading multi-channel home furnishings retailer,” Liz Wilson, IKEA Canada country customer fulfilment manager said in a statement. “By continuing to grow and optimize our distribution networks, we ensure the IKEA business is fit for long-term growth and we are better able to meet our customers' needs for convenience and speed in this fast-changing retail landscape.”

IKEA Canada’s senior management team – including president Michael Ward (second from left) – celebrate the opening of its new distribution centre in Kleinburg, Ontario.She added the Kleinburg customer distribution centre will focus on last mile delivery directly to customers’ homes and will complement the retailer’s four stores – as well as its existing distribution centre in nearby Mississauga – across the Greater Toronto Area.

Customers served by the new centre are expected to see shorter delivery lead times, which will support the retailer's expanded service offering, including new lower pricing for parcel and truck delivery.

The site has created approximately 120 indirect jobs and is operated by DHL Supply Chain, a specialist in contract logistics and part of Deutsche Post DHL.

“Through our deep industry and market expertise, we’re well-positioned to help IKEA increase productivity and meet the ever-changing expectations of every customer, every time,” said Jennifer Askew, DHL’s vice president of Canadian retail operations. “Our culture of continuous innovation also enables our team to bring productivity-enhancing technology and data-driven insight to drive even greater agility and flexibility needed throughout the retail industry.”

Wilson also noted IKEA wants to have a positive impact on people and the planet. “Opening this new distribution location in the Toronto area brings the retailer closer to the customer, reducing transport distances and emissions,” she said.

IKEA, the world’s largest home furnishings retailer, has also committed to having 100% electric or zero emission vehicles in service globally by 2025.

The new Kleinburg location is IKEA’s fourth customer distribution centre in Canada. The first opened in the Vancouver area last year. It also operates facilities in the Montreal and Toronto areas. The retailer’s network in this country includes 14 stores, an e-commerce virtual store, five pick-up and order points and 17 collection points.

Fairstone to provide POS financing to Carpet One Floor & Home

19 September 2019
Flooring, Furniture, Retail

MONTREAL – Fairstone Financial, a non-bank provider of lending solutions, has signed a deal to provide point-of-sale (POS) financing for all retail purchases at some 90 Carpet One Floor & Home locations across the country.

As part of its retail POS financing offering, Fairstone is also providing Carpet One Floor & Home with an automated, mobile and digital financing platform enabling customers to be approved for financing in under two minutes.

Until 2017, when it was acquired by J.C. Flowers & Co. LLC and Värde Partners – a pair of U.S. based investment firms – Fairstone was known as CitiFinancial Canada.

In a statement, Fairstone said its proprietary solution easily integrates within the existing retail experience, simplifying the customer experience and dramatically reducing time and friction associated with paper-based credit application. This allows retail sales representatives to spend their time focusing on sales and customer service.

“We’re pleased to be working with the Carpet One Floor & Home banner to provide frictionless financing to their customers and support their continued growth in a competitive space,” said Serges Bériault, Fairstone senior vice president of indirect lending.

“Fairstone is providing a convenient and flexible financing solution for our customers and we’re pleased to launch their digital financing platform in all locations across Canada,” added Baxter Freake, vice president of Carpet One Floor & Home.

Carpet One Floor & Home is a co-operative floor covering retailer, with 1,000 independently owned and operated locations in the United States, Canada, Australia, and New Zealand.  It is a division of CCA Global Partners, which also operates the Flooring Canada banner.

Sunpan renews Corus agreement

18 September 2019

TORONTO – Contemporary furniture resource Sunpan has renewed its agreement with Corus Entertainment to be the exclusive on-set furniture provider for several the television programs it produces, including ET Canada. This will be the third consecutive season for the deal.

“Working with Corus Entertainment to furnish multiple television sets has been an exciting partnership,” Sunpan chief marketing officer Katherine Kalen said in a statement. “The style of our furniture aligns perfectly with entertainment and popular celebrity culture while providing durability and comfort.”

The Westin sofa, Kristoffer lounge chair, Kane end table and Evert coffee table from Sunpan are seen here on the set of ET Canada’s interview lounge at the Toronto International Film Festival.The 2019 season partnership was launched during the recently ended Toronto International Film Festival with Sunpan providing the furniture for the ET Canada Interview Lounge. Directors, actors, producers and Hollywood A-listers were seen interviewed by ET Canada hosts while seated on the Westin sofa, Kristoffer lounge chair, Kane end table and Evert coffee table.

This year, Corus Entertainment producers opted for a cohesive look across several programs. Set designs for the Canadian Country Music Awards broadcast in early September as well as the daily edition of ET Canada feature Sunpan pieces designed with vintage blue faux leather, antique brass and white marble.

CREA boosts 2019 forecast

18 September 2019
By the Numbers

OTTAWA – For the second time this year, the Canadian Real Estate Association (CREA) has upwardly revised its quarterly forecast and now believes home sales via its Multiple Listing Service (MLS) will gain 5% by the end of 2019 and will jump another 7.5% next year. They attributed the anticipated climb to a number of factors including population and employment.

This is good news for big ticket home goods retailers of all kinds as each home sale is expected to generate between $6,000 and $6,500 in furniture, mattress and major appliance sales over the next three years.

“Economic fundamentals underpinning housing activity remain strong outside of the Prairies and Newfoundland & Labrador,” CREA said in its forecast. “Population and employment growth have both remained supportive and the unemployment rate remains low. At the same time, expectations have become widespread that the Bank of Canada is unlikely to raise interest rates over the rest of the year and into next.”

Chart courtesy of the Canadian Real Estate Association.The realtors’ group also noted longer term mortgage rates have been declining – most importantly the five-year rate used by banks to qualify mortgage applicants.  “The decline in mortgage rates is arguably the most important development since the release in June of CREA’s most recent forecast,” the association said.

The forecast also said price declines in the Lower Mainland of British Columbia and across the Prairies may be abating while those across Ontario’s Golden Horseshoe region are showing signs of re-accelerating.

“Strong economic fundamentals, previously unexpected declines in mortgage interest rates and stronger than previously expected housing market trends in British Columbia and Ontario have resulted in CREA upwardly revising forecast home sales in 2019 and 2020,” the forecast said, adding it expects overall national sales to remain below those prior to the implementation of the stress test.

CREA said national home sales are now projected to total 482,000 units in 2019, a 5% increase from the five-year low recorded in 2018. This is an upward revision of 19,000 transactions from CREA’s previous forecast and represents a return their ten-year annual average. “It also remains well below the annual record set in 2016, when almost 540,000 homes traded hands. Notwithstanding the upward revision, the forecast for 2019 on a per capita basis remains the second weakest since 2001,” the forecast said.

B.C. will take the biggest hit, with sales falling 5.4% this year. Alberta, Saskatchewan and Newfoundland & Labrador are all forecast to come in at or near multi-year lows in 2019. By contrast, Manitoba, Quebec and New Brunswick are expected to set new annual sales records. Activity in Ontario is forecast to be in line with the 10-year average for the province.

CREA still maintains the national average price will stabilise this year, though with a small 0.5% increase instead of the previously forecast 0.6% decline. It is projected to come in at $491,000 nationally although it is expected to fall in B.C., Alberta, Saskatchewan as well as Newfoundland & Labrador while rising in Ontario, Quebec and the Maritimes.

In 2020, national home sales are forecast to rise by 7.5% to 518,100 units next year, with most of this increase reflecting a weak start to 2019 rather than a significant change in sales trends out to the end of next year. Sales in B.C. are expected to return to their ten-year average, gaining 14.3% on a year-over-year basis.

Ontario and Quebec are predicted to see sales rise by about 7% in 2020, while activity in Alberta will recover by about 5% compared to 2019. The number of homes trading hands in other provinces is predicted to edge up or down only marginally.

The national average price is forecast to advance by 2.1% in 2020 to $501,400 – still below the record set in 2017. CREA believes average price trends across the country will be more moderate versions of those in 2019, with small declines in Alberta, Saskatchewan and Newfoundland & Labrador with modest gains in Ontario, Quebec and the Maritimes. In B.C., the average price is expected to stabilise following this year’s decline.

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Home Goods and its accompanying newsletter - HGO This Week - covers the furniture, bedding, appliances, consumer electronics, accessories, lamps and lighting and floor coverings product sectors of the big ticket home goods market in Canada. HGO is also a forum for the dissemination of market research and hard-hitting articles on best practices for Canadian retailers.

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