9 iconic Canadian brands that went bankrupt or filed for protection in 2020
The pandemic has not been easy on businesses.
This year, thousands of small businesses and shops in Canada have gone under because of COVID-19-related economic hardships.
Between forced closures and sharp decreases in revenue, a survey by the Canadian Federation of Independent Business (CFIB) in the early days of the pandemic in March found that almost one-third of small businesses that were forced to close temporarily — 32% — were unsure if they’d ever be able to reopen. Many didn’t.
But even high-profile, legacy brands that are household names in Canada weren’t immune to the devastating effects of COVID this year.
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From clothing retailers to entertainment powerhouses and iconic fashion chains, Canada lost some heavy hitters this year.
Here are some of the iconic Canuck brands that were forced to restructure, filed for bankruptcy, or sought protection from creditors in 2020.
Thanks to private investment money, some, like Mountain Equipment Co-op, will live to see another day. Others, like Papyrus, have shuttered physical locations permanently, closing a long retail chapter of storefront shopping.
In October, Montreal-based fashion brand Le Château announced it would liquidate assets and wind down operations at all of its 123 stores. With cancelled events and celebrations this year, demand for its holiday party and occasional wear absolutely tanked, and the retailer said it had “no other option” than liquidation. Founded in 1959, the company employed 1,400 people.
Mountain Equipment Co-op
After filing for creditor protection, MEC announced in September it was ending its 49-year run as a co-op by selling to a US private equity firm — after its already struggling finances were worsened by the pandemic. Disappointed co-op members launched a petition to halt the sale to private firm Kingswood Capital Management, eventually gathering more than 150,000 signatures. The sale will turn Canada’s largest co-op into a private company. Brand headquarters are expected to remain in Vancouver, and Kingswood has pledged to keep 17 of MEC’s 22 locations open while retaining 75% of its employees.
Aldo Group Inc.
Citing too much pressure on businesses and cash flow during COVID, the Montreal-based shoe powerhouse filed for creditor protection in Canada in May. CEO David Bensadoun decided filing for protection was the best option to “survive this challenging period” in the short term while carrying on operations long term. The Aldo Group, which includes Aldo, Call It Spring, and GLOBO, operates almost 3,000 stores in 100 countries.
This summer, the iconic tea chain announced it would shutter 80 retail locations in Canada as part of a restructuring that would see 124 store closures across the continent. Although Herschel Segal, founder of the Montreal-based beverage brand, promised the closures were being made to ensure the long-term success of the brand, he admitted that all of the closed locations, many that were in malls, were unprofitable. A hundred Canadian locations were expected to stay open.
Moores the Suit People
Tailored Brands, the company that operates Moores the Suit People and Men’s Wearhouse, filed for Chapter 11 protection in the summer. Without men purchasing formal wear for weddings, work, prom and social events, the operation saw profits haemorrhage amid the COVID-19 pandemic.
Cirque Du Soleil
After the forced closure of dozens of its performances around the world and essentially zero revenue for months, the circus group filed for bankruptcy protection in Quebec court in June. Daniel Lamarre, president and CEO of Quebec founded and Montreal-based Cirque du Soleil Entertainment Group, said the purchase agreement would forge a path for the legendary entertainment powerhouse to emerge from COVID as an even stronger company, and an opportunity to rebuild operations “to once again create the magical spectacle that is Cirque du Soleil for our millions of fans worldwide.” In an Instagram post, the company said its performances were merely paused and asked fans to consider it a brief intermission.
Carlton Cards and Papyrus
Founded in Toronto 100 years ago (yes, 100!), Carlton Cards surpassed Hallmark as the market leader in the “social expressions” industry in 1970. Parent company the Schurman Retail Group (SRG) made a decision this year to close all of its specialty Carlton Cards and Papyrus stores — including 79 in Canada. In total, 254 stores will close across North America. The popular greeting card retailer employed over 1,400 people. Luckily for greeting card fans, Carlton and Papyrus products will still be available in 6,000 Canadian retail locations.
Dynamite and Garage
After record performance at its Dynamite and Garage stores in 2019, Groupe Dynamite Inc announced in September it had to restructure its business and secure court protection from creditors as a direct result of the COVID-19 crisis. The Montreal-based retailer said the ongoing pressures of store closures, social distancing measures, closed borders, and lack of tourism were just too much for its bottom line. Since starting in the 1970s, the company had expanded to over 300 stores in North America. It is still operating online, and it’s unclear how many stores will close as a result of the restructuring.
Starting in Calgary 45 years ago and growing to one of the country’s largest swimwear chains with 18 stores, Swimco announced in October it was going out of business after filing for bankruptcy. All storefronts were shuttered the same month, but their online presence will live on. Swimco operated in all five provinces east of Quebec, but the bulk of operations were in BC and Alberta.
Finally, here’s another 17 Canadian brands that suffered heavy losses this year.
- Flighthub Group Inc. – May 8
- Geox Canada Inc. – September 8
- GNC Holdings – June 29
- TA Hotel Management Ltd. Partnership – August 17
- Laura’s Shoppe Inc. – July 31
- Stokes Inc. – July 27
- Ann Canada Inc. – July 23
- Boutique Tristan & Iseut Inc. – July 20
- Mendocino Clothing Company Ltd. – July 14
- Lucky Brand Dungarees Canada – July
- Modasuite Inc. (Frank and Oak clothing retailer) – June 22
- Sail Outdoors Inc. – June 2
- Reitmans (Canada) Ltd – May 19
- Cranbrook Glen Enterprises Ltd. – May 1
- Foodora Inc. – April 27
- Marche Restaurants – April 16
- CannTrust Holdings Inc. – March 31