Hudson’s Bay Company, a prominent player in the Canadian retail scene, is grappling with the impact of the ongoing Covid-19 pandemic. To address the disruptions caused by the crisis, the company has reluctantly made the decision to permanently lay off employees throughout the country. This unfortunate move affects more than 600 workers, equating to roughly five percent of the company’s workforce.

The pandemic has taken a significant toll on Hudson’s Bay, primarily due to enforced store closures that have persisted over the past year. Currently, around half of the company’s department stores remain temporarily shut. This situation undoubtedly presents significant challenges for a business that heavily relies on in-store sales.

In spite of these trying times, Hudson’s Bay is actively working on an innovative plan to adapt and thrive within the retail industry. Reports suggest that the company is exploring the possibility of separating its online platform, Saks.com, into a distinct public company. This strategic maneuver aims to establish two separate entities: Saks.com and Saks brick-and-mortar stores, which would operate under an exclusive agreement.

Sources indicate that Hudson’s Bay is currently in discussions with investors regarding a private placement, which could potentially lead to an initial public offering (IPO) within the next year. This development aligns with a broader trend in the retail sector, where many retailers have pursued IPOs in recent times to leverage market opportunities and ensure future growth.

Saks.com, known for its strong online presence, has recently undergone significant enhancements. These include a revamped new arrivals section and an increased focus on menswear categories. These improvements underscore the company’s commitment to continuously enhancing its online shopping experience and catering to the diverse needs of customers.

By separating Saks.com from its physical stores, Hudson’s Bay aims to capitalize on the expanding potential of e-commerce while maintaining the strength of its retail locations. This strategic move enables the company to adapt to changing consumer behaviors and preferences in a rapidly evolving retail landscape.

The success of similar ventures in the industry further affirms the market potential and viability of this approach. For instance, German luxury retailer Mytheresa achieved a valuation of $2.2 billion through its recent IPO in New York. Like Saks, Mytheresa offers a wide range of luxury products for women, men, and children from renowned designer brands. This successful IPO indicates the market’s openness to online luxury retail platforms.

Another relevant example is Poshmark, whose shares more than doubled during its public debut earlier this year. Additionally, ThredUp, a competitor in the resale market, confidentially filed for an IPO in October 2020. These cases demonstrate the resilience and growth opportunities within the retail sector, even in the face of challenging circumstances.

Significantly, Hudson’s Bay has managed to navigate the Covid-19 crisis without resorting to bankruptcy, setting itself apart from other long-established department stores such as J.C. Penney and Neiman Marcus. This resilience speaks volumes about the company’s ability to adapt to changing market dynamics, explore new avenues for growth, and prioritize the well-being of its employees and customers.

As Hudson’s Bay embraces its plans for Saks.com’s IPO and continues to manage the ongoing challenges posed by the pandemic, it remains steadfast in its commitment to delivering exceptional shopping experiences and meeting the evolving needs of its customers. By leveraging the power of e-commerce and maintaining a strong presence in physical stores, the company aims to shape a successful future within the retail industry.

Useful links:
1. Hudson’s Bay Company Official Website
2. Mytheresa Official Website