Thunder Bay, Ontario. Wal-Mart and Target Divide Up The Spoils
This week, residents in Thunder Bay, Ontario contacted Sprawl-Busters to strategize about the saturation of their community by Wal-Mart and Target. A dying Canadian retailer is being carved up by the two American retail cannibals that helped eat Zellers, the Canadian retailer.
"As you may be aware," one resident of Thunder Bay wrote, "Canada's Hudson's Bay Company sold the leases to some of its Zellers stores. There were 3 Zellers stores in our town, 2 of which had been sold to Wal-Mart. We already saw the drop in sales at other stores when the first Wal-Mart opened and when they renovated it to became a "super Wal-Mart." Many of our local grocers are feeling the pinch from a decline in sales. We as a city are struggling to keep some sense of identity and beautify our downtown core -- but this cannot happen if our dollars are usurped by a faceless corporation and delegated to who knows what.. Please help, our local economy is suffering and morale is low, but if we see some hope, we will fight for what's right."
In late September, the Thunder Bay News Watch confirmed that Wal-Mart planned to open up two new stores in Thunder Bay by late 2012. Two giant U.S.-based retail conglomerates 'negotiated" over the remains of the Zellers department stores. Wal-Mart Canada and Target Canada huddled over who would take over 39 store locations owned by the Hudson's Bay Company. Nineteen of these stores are in the province of Ontario. Two of the stores listed were in Thunder Bay -- one at County Fair Plaza and the other at the Arthur Street Marketplace. The stores are expected to be open late 2012.
On September 23, 2011, Wal-Mart Canada issued a press release which began: "Today Wal-Mart Canada announced that it has completed the acquisition from Target Canada of leases for 39 store locations currently occupied by Zellers. Wal-Mart also announced the locations acquired... Wal-Mart expects this announcement will create more than 5,000 construction, trade and store jobs and will represent a significant investment in Canadian communities."
According to the Sault Star newspaper, Target bought 189 Zellers leases, and plans to open Target stores in as many as 135 of them beginning in 2013. The remaining leases were sold off to other retailers or businesses. One of the Zellers stores bought by Target will also be opened in Thunder Bay.
Thunder Bay News Watch says that employees at two of Thunder Bay's Zellers stores have been told they have another nine months of employment left before their stores close and are taken over by Wal-Mart.
According to staff working at the Zellers at County Fair Plaza and Arthur Street Marketplace, the last day for the two stores will be June 2, 2012. Staff will continue working at the two stores for another few weeks after the closure date. Each of these Zellers stores has about 100 employees. Hudson Bay Company says that all employees have been offered resumé and job re-training services to help them find other jobs once their stores close.
In September, Wal-Mart also announced it had taken over the leases of 39 Zellers stores across Canada, including two in Thunder Bay. Between the two of them, Target and Wal-Mart have overtaken 228 dead Zellers stores.
The Canadian experience should help Americans understand that when giant retail chain stores come to town, they represent a form of economic displacement, not economic development. The demise of Zellers illustrates the zero sum game that unfolds in most communities. No new jobs are created, no added value to the local trade area.
What you can do: Wal-Mart and Target issued press releases touting the new jobs they are creating in Ontario -- but as the Zeller's experience demonstrates -- they are really old jobs in new name tags.
The lead on Wal-Mart's press release focused on jobs: "Canada's fastes-growing retailer to create more than 5,000 jobs." But all that has happened is that two American-controlled corporations have divided up the weakened Hudson's Bay Company. As of September 2011, Wal-Mart now has 181 discount stores and 148 superstores in Canada. Wal-Mart has been in Canada since 1994.
In response to the Wal-Mart store takeovers, one reader of the Thunder Bay News Watch commented: "After 20 years of service at Zellers, those employees are over qualified to work for Wal-Mart. And might be paid a little over minimum wage too, so Wal-Mart wouldn't be able to make payroll and still produce record profits with those overpaid workers!" Another reader posted this comment: "Every single ignorant person that spends a dollar at Wal-Mart is responsible for this. Every penny you "save" at Wal-Mart is making you more destitute."
"When Wal-Mart bought out Woolco it was in the agreement that they would take on the former employees of the stores. Not in this case. Just the leases were purchased and no concern from Hudson Bay Company or Target about all the employees they are about to put out of work. Yes they have offered resumé and job re-training services to help them find other jobs -- but no guarantee that they all will. So what is wrong with fighting and trying to organized and bring in a union? They got nothing else to lose now do they?"
Readers are urged to email Wal-Mart Canada's Director of Corporate Affairs, Susan Schutta, at firstname.lastname@example.org with the following message:
"Dear Ms. Schutta,
I have my pencil in hand, and I am trying to figure out what kind of math Wal-Mart Canada used to come up with the figure "more than 5,000 jobs" which you claim are being "created" by your takeover of 39 Zellers stores. It looks to me like the loss of Zellers jobs pretty much makes this deal an economic wash for Canada -- no real added value. And if these workers dare try to organize -- Wal-Mart Canada will threaten to shut these stores down. So where's the gain here for Canadians? The demise of Zellers means a larger slice of the retail pie for Wal-Mart and Target. That helps your corporate to 'live better,' but it won't mean much to the job outlook in Canada."