Target's loss in Ottawa is Walmart's gain: Expert
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Target's loss is Walmart's gain.
Walmart's announcement of a $340 million expansion plan across Canada over the next year shows the U.S.-based retailer has been "licking their chops" at recent announcements other retail chains are scaling back or pulling out of the country.
The biggest of these is Target.
"So many people in the city were calling this (Target closing) a disaster," said Ian Lee, assistant professor in the Sprott School of Business at Carleton University. "It's not a disaster. Walmart sees this as an opportunity to expand and take Target's sales."
But it's not just Target's sales Walmart could be taking.
"This is just the latest example of churn in the retail industry," Lee said. "Jobs in the city will be quickly re-absorbed by Walmart and other competitors."
Walmart says the expansion is expected to create approximately 3,700 construction jobs, 1,000 in-store jobs and 300 distribution centre jobs across the country over the next year.
Walmart said $230 million will go towards building or upgrading 29 supercentres.
Lee adds Walmart won't be the only retailer in Ottawa expanding to pick up the sales that were going to Target.
"I could see Canadian Tire and Ikea making similar moves," he said.
There are currently nine Walmart locations spread across the nation's capital and more could be coming.
However, Walmart won't specify how its plans will impact Ottawa and surrounding areas.
"We aren't announcing specific store locations today," said Andrew Pelletier, vice president of Corporate Affairs and Sustainability at Walmart Canada. "Location and timing for specific store and distribution centre projects will be confirmed later on as projects become finalized over the coming weeks and months."
Mike Mulvey, assistant professor at the Tefler School of Management at the University of Ottawa, said he's curious to see where Walmart decides to set up their new shops.
"Riverside South could probably support one. There's enough of a community there and it's really under-serviced," he said. "I also wouldn't be surprised if Findlay Creek was on their radar."
Mulvey said he expects Walmart would rather create a few new superstores, instead of turning over older Target locations.
"I know they won't want to retrofit the Target on Billings Bridge. I think they'd rather build a superstore on a new piece of real estate."
He said consumers in Ottawa should be happy about the expansion news, for the most part.
"They better not put it near Lansdowne though, or we'll be hearing about it from the locals," he said.
Twitter: @Keaton_Robbins
