Sears Canada Cuts Deal With Reitmans To Resell Its Penningtons Plus-Size Garments

The idea of cooperating with a rival (but only when there are serious bucks to be made) is alive and well in Canada these days. As the U.S. retail invasion of Canada (Sears Canada, Target Canada, Best Buy) continues, it might be surprising to see top Canadian chain Reitmans (about $1 billion in annual revenue, 1,000 stores) partner with Sears. But partnering is what it's doing, with the goal of selling the clothing from a Reitmans brand (Penningtons).

Penningtons sells into the plus-size space and the two chains saw that finding a great home within Sears Canada's stores. "We are delighted with our new association with Sears Canada," said Jeremy Reitman, Chairman and Chief Executive Officer of Reitmans (Canada) Limited. "The Penningtons brand and the Sears brand are both well-established and highly respected names in the Canadian marketplace and this combination is another effective way for Penningtons to market its apparel to Canadian women in a trusted and attractive retail environment."

The main details: Initially Penningtons will be available in five Sears pilot stores as well as on sears.ca. Penningtons apparel is expected to be introduced in additional Sears locations, and in the Spring general catalogue, in 2014. Here's where it gets interesting: the two chains said that "Sears will be the only Canadian store to offer Penningtons apparel outside of Penningtons' own stores."

First, Reitmans having to publicly refer to Sears as a "Canadian store" (as opposed to "a chain with stores in Canada") must have caused more than one Reitmans executive to say those words and then run into the hall shouting "It burns! It burns!" Secondly, if Reitmans wanted to offer Penningtons' products outside of Penningtons stores, why not start with its own stores, such as Reitmans, SmartSet, RW&Co, Addition Elle and Thyme? That gets us back into the plus-size issue.

Reitmans have been precisely targeted, with each brand having a very specific audience and merchandise segment. By cutting this deal with Sears, it can sharply expand the number of stores the merchandise is in without diluting any of its marketing distinctions.

"We're excited to bring Penningtons to Sears because it supports our strategy of working with successful brands that provide immediate credibility and continuity to our apparel offerings," said Calvin McDonald, President and CEO, Sears Canada. "There is a real opportunity for Sears to take a leadership role in serving the plus-size demographic, a segment that has traditionally been underserved. Penningtons caters to a fashion-focused customer, which complements the traditional offering currently available at Sears."

As Sears' statement suggests, Sears is open to almost anything that will deliver foot traffic. We then have one chain that is struggling with product and audience segmentation—and one chain that is pretty much just struggling. A match made in heaven—or at least Toronto.

For more:
- See the Sears Canada statement

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