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It’s hard to keep a Secret

Traffic at Yorkdale shopping mall jumped 40 per cent the day the hotly anticipated lingerie retailer Victoria’s Secret opened its first GTA store in August.

Traffic at Yorkdale shopping mall jumped 40 per cent the day the hotly anticipated lingerie retailer Victoria’s Secret opened its first GTA store in August.

That’s the power some big U.S. brands can wield in Canada, says mall manager Anthony Casalanguida.

“A lot of Canadian shoppers are very familiar with American brands. There was a lot of pent-up demand for them,” he said Thursday.

With Canadian retail sales running on average three to four percentage points ahead of the U.S. market in recent years, more American chains are looking to move north of the border, according to a report by Moody’s Investor Services.

But with consumer debt fuelling much of the increase in Canadian retail sales, can the fire keep glowing, Darren Kirk, senior vice-president at Moody’s asks in his report entitled Canadian Retail Competition Heating Up.

The list of U.S. retailers with Canadian plans includes cheap chic discounter Target Corp., specialty clothing firm J. Crew, and Marshalls department stores, a sister chain to Winners and HomeSense, the report says.

They will be joining some high-profile recent entrants, including Brooks Brothers and Crate & Barrel, the report says. U.S. retailers already here are expanding their Canadian operations, the report adds.

Having saturated their home market, many American retailers are looking to Canada as a first stop on the road to global expansion, the report notes. The geographic proximity and shared language make it a natural starting point.

As well, sales here have been more robust during the recent economic downturn than in the U.S., where the housing market and jobs took a bigger hit during the recent financial crisis.

Retail profit margins in Canada have also been relatively strong, the report says.

 
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