Sephora Expands Operations with ‘Takeover’ Initiative

Paris based beauty retailer Sephora (operating under the LVMH corporate umbrella) is in the process of expanding its Greater Toronto Area (GTA) operations in an effort to dominate and gain market share. Sephora’s ‘Toronto Takeover’, as it’s being called, includes new store openings as well as store renovations and expansions. 

Last week we revealed Sephora’s relocation plans for its Toronto ‘Mink Mile’ Bloor Street flagship. Bloor Street is one of Sephora’s five Toronto ‘headquarter doors’, according to a source familiar with the company. Each of these ‘headquarter’ stores is or will be in the 8,000 square foot to 10,000 square foot range when completed. The four other GTA headquarter doors include Sephora’s CF Toronto Eaton Centre, CF Sherway Gardens, Mississauga Square One and Yorkdale Shopping Centre stores. The 8,985 square foot CF Toronto Eaton Centre Sephora (which sources say is the second-highest selling Sephora location in North America) recently saw renovations, with a grand ‘re-opening’ event held last week. The CF Sherway Gardens store is seeing a 3,000 square foot expansion this summer that will bring it to about 9,000 square feet, with sales expected to increase substantially as a result. Square One’s Sephora recently saw renovations and is receiving minor retrofits, and the Yorkdale Sephora is seeing an expansion from 5,730 square feet to about 9,220 square feet that should be completed within several months, as part of Yorkdale’s expansion that will see a new Nordstrom-anchored wing open this October. 

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Sephora will open a further four new GTA locations in 2016 as part of its Toronto Takeover. A location at Vaughan Mills opened on Friday of last week, and this summer Sephora will open stores at RioCan’s Yonge-Eglington Centre (one of its largest in Canada at 10,459 square feet), RioCan Oakville Place in Oakville, and at Bramalea City Centre in Brampton. 

Aurora Realty Consultants represents Sephora as brokerage in Canada.  

In July of 2015, Sephora launched its Canadian ecommerce site, sephora.ca, to facilitate its growing Canadian business. Prior to that, online purchases were routed through the United States. As part of its new Canadian ecommerce initiative, Sephora retained a third party logistics provider out of Mississauga to facilitate order fulfillment in Canada. Sales have been stellar on the website, surpassed only by annual revenues at the CF Toronto Eaton Centre Sephora flagship, according to the source (the same source provided but asked us not to publicly disclose Sephora’s current/projected store sales numbers in this article).

Sephora expects about 50% of all its Canadian revenue to come out of the GTA by 2017 as part of this initiative, according to the source. Sephora now accounts for approximately 20% of the prestige beauty market in Canada, and it’s looking to gain market share from competitors as diverse as Holt Renfrew and Shoppers Drug Mart. Sephora’s Toronto Takeover is also targeted towards Millennial consumers — a hot market being courted by many companies including cosmetics brand NYX, which we will discuss soon in a separate article. 

As we mentioned last week, Sephora Americas’ President and CEO Calvin McDonald (formerly head of Sears Canada) is speaking today at this year’s Retail Council of Canada STORE Conference 2016, being held May 31 and June 1. Mr. McDonald’s presentation is titled ‘Winning in a Digital Landscape’. For details, visit: www.storeconference.ca/agenda.

Canadian Retail News From Around The Web: May 31, 2016