Lowe's is closing 34 stores in Canada
Lowe’s Companies Inc., the U.S. owner of Rona and Lowe’s home improvement stores, says it’s closing nearly three dozen outlets across Canada — including two in Calgary — because of underperformance.
The Lowe’s in Shawnessy, which employs 118 people, and the Rona in Midnapore, which employs 35, are scheduled to shut their doors Jan. 31, 2020, along with 32 other Lowe’s, Rona and Réno-Dépôts locations in Canada, the company said in a statement Wednesday. While the company has said that eligible employees will be shifted to nearby stores, Nita Chhinzer, professor of human resources at the University of Guelph, said a high number of layoffs are expected nationwide.
“There will be a number of people who will experience job loss, and it’s a very nervous time of year for individuals to be laid off because they’ll start to make decisions about how much they can enjoy the holiday season and how much is set aside for savings,” said Chhinzer.
She added that the hardware stores will be busy over the holidays but employee morale will be low and staff will put on a “brave face” for customers. The store closures could affect the company’s brand as an employer at the remaining locations in the city, and the competition for work will increase as some employees are laid off and others leave the company for something sturdier, said Chhinzer.
The closures come after an internal strategic review and almost a year to the day after Lowe’s closed 31 properties across the country in November 2018.
Lowes, based in Mooresville, N.C., bought Rona in 2016. Rona was founded in 1939 in Quebec, and that’s where the largest share, 12, of the closures will occur.
Lowe’s owns about 600 stores across Canada under the Lowe’s, Rona, Réno-Dépôt, Ace and Dick’s Lumber banners, employing some 28,000 people, the company said.
“While making decisions that impact our associates and their families is never easy, closing underperforming stores is a necessary step in our plan to ensure the long-term stability and growth of our Canadian business,” Tony Cioffi, interim president of Lowe’s Canada, said in the statement. “We are taking decisive action to build a healthy business, which will provide us with the flexibility to reinvest in our future growth.”
Lowe’s said in the statement that all affected employees will have access to the Employee Assistance Program and many will transfer to newly created merchandising support positions in Rona big-box stores.
Chhinzer said this is another example of physical shops dying in the age of online shopping. Such store closures also affect the local economy by reducing foot traffic in shopping plazas where they operated, which has been seen with closures of Sears and Future Shops, and complicating the market for plumbers, carpenters and others in affected industries.
“I don’t know if Calgary could handle five or so different Lowe’s and Rona locations providing the same service while competing with Home Depot and online. Maybe they expanded too aggressively and consumer demand didn’t meet up. But the rise of online shopping is a challenge all retailers in Canada are facing,” said Chhinzer. “I’m wondering with Rona and Lowe’s if this is the start of the end.”
— With files from Reuters
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November 21, 2019 at 05:56AM
