Rona shifting away from big-box stores

Canadian retailer Rona will close 10 of its warehouse-sized stores by the end of the year, shifting its focus to the opening of 25 smaller-format units, the company announced on Feb. 24.

The new focus comes on the heels of a C$151 million loss posted for the company’s fourth quarter, which ended Dec. 25, 2011. This compares with a profit of C$20 million in the same period a year ago.

Net sales for the fourth quarter increased 2.6% to C$1.17 billion. Same-store sales were down 2.3% in the quarter.

The Quebec-based home-improvement chain, Canada’s largest, posted a loss of C$78.4 million for fiscal 2011, compared with C$137.4 million in net income in 2010.

Most of the big-box closings will be in Ontario. The rollout of the 25 smaller stores includes retrofitting and reducing the size of 13 big-box stores. The new “proximity” stores will average 35,000 sq. ft., and the concept will be deployed in 20% of the Rona corporate store network, the company said. The new store has been tested over the past year in Edmonton, Alberta; Repentigny, Québec; and St. John’s in Newfoundland and Labrador. 

Other new plans for the company include the rollout of a new integrated digital platform, which includes the new website rona.ca. In addition, the company will complete a full review of the digital platform and part of the Rona store network in order to adapt to the new social and economic realities influencing the behavior of Canadian consumers.

“The primary objective of the New Realities, New Solutions plan is to bring us closer to consumers, which means being either just a click away, or no more than 10 minutes distance from a Rona store that perfectly meets their needs,” said Robert Dutton, Rona’s president and CEO. 

Luc Rodier, executive VP retail, added: “In response to consumer demand, these stores emphasize service, with more experienced staff and a central service counter that forms the heart of the store and is visible as soon as you enter, along with a more user-friendly layout, a regionally based offering and an optimal choice of products in key categories.”

Rona currently operates 700 retail and distribution locations throughout Canada.