Canadian retail sales grew 2.8% in the first quarter marking the highest gains in six months. Across the board, retail sales in all major retail sectors are increasing, a solid indicator that the market is heading in the right direction; according to retail consultant Ed Strapegiel (stats from Statistics Canada). Notable highlights include increases from the Food & Drug sector (↑3.6%); Supermarkets and grocery stores (↑4.3%); and health & personal (↑3.1%). The highest growth in Canadian retail over the past three months appears to come from miscellaneous store retailers with gains of 9.3% yoy (mostly thanks to new cannabis stores opening). Jewelry, luggage, and leather goods all did well with 7.5% gains while General Merchandise grew by 5.5%—marking the categories highest gain in over a year. Poor performers include consumer electronics and appliance stores with sales decreasing by 8.8% over the past three months.
One of the largest growth areas for Canadian retail is e-commerce where sales were up almost 20% in the first quarter. In the 12 months ending April 2019, electronic shopping and mail-order houses had an estimated $11.4 billion in e-commerce sales. In addition, many Canadian brick and mortar stores also sell online with estimated sales of close to $8 billion. Overall, Canadian e-commerce represents 3.1% of total retail sales, representing $19 billion. Total Canadian retail sales are approximately $624 billion, according to Strapegiel.
Additional research shows that by 2027, the value of consumer returns will near $1 trillion worldwide. Current trends show that the majority of these returns will stem from e-commerce; which currently has a 30% return rate. This high return rate creates three priorities for retailers who must 1) keep warehouse inventory flowing; 2) increase recovery rates against the rising costs of labor, processing, and shipping; and 3) retain brand protection.
These top priorities create a need for a new, modern liquidation process to sell off returned and overstocked items that can no longer be sold as new. B-Stock provides retailers a private, online marketplace to auction off returned and overstock merchandise, on an ongoing basis, to a large network of business buyers from across the country. By selling via their own B2B liquidation marketplace to a larger buyer group, retailers can increase recovery rates and keep warehouses from hitting capacity.
Please take a moment to review our case studies and our suite of private marketplaces that we operate for the world’s top retailers, including hundreds of smaller retailers that are also suffering from increased returns due to online sales.
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