As we start talking about the economic factors in terms of The Hudson’s Bay Company,the unemployment rate is something that comes to mind.
According to recentresearch, the unemployment rate in Canada is 6.3%, which is considerably low. Forthe Hudson’s Bay Company, this could be a major advantage. Having a lowerunemployment rate results in more consumers with higher purchasing power,leading to more spending on retail. This is an important factor as e-commerce isan endlessly increasing form of retail business, and for The Hudson’s Bay Companyto not take advantage of the market opportunity, would be an economical mistake.As retail e-commerce revenue in Canada from 2015 has grown immensely, with16.92 billion US dollars in 2015 and a proposed amount of 28.66 billion USdollars by 2021.
Pursing the online retail business would be a strong corporatemove (Duncan, E). As of recently, the closures of bothTarget and Sears have put the Hudson’s Bay Company into a position of having limitednumber of direct Canadian competitors. Though, still compete on a smaller scalewith retail and department stores such as Canadian Tire and Giant Tiger.
Hudson’sBay has now made a prominent deal by selling the majority of the owned leasesfor Zellers to the Target corporation in 2011 for $1.8 billion, this being morethan what he paid for the entire possession of the company three years earlier (Strauss,2017). Having a vast financial gain from the recent sale of a failingdepartment store, would eventually allow for more growth within The Bay’sindustry. The Hudson’s Bay company developed a plan to cut around 2,000 jobsacross their North American stores in order to stay in the competitive marketof the retail environment.
This plan would be completed by the end of the 2018fiscal year to save the company an estimated $350 million annually (TheCanadian Press, 2017).