Los Angeles - The Canadian market offers an opportunity for U.S. retailers to expand and to gain experience operating in an international market. According to a new study from market research firm IbisWorld, the U.S. retail segment best suited for expansion into Canada is department stores, followed by men’s clothing stores.
In order, the remainder of the top five U.S. retail categories primed for expansion into Canada are shoe stores, auto parts stores, and lingerie, swim and bridal stores. According to IbisWorld analysis, U.S. industries best suited to expand into Canada are characterized by slow growth and a high level of market share concentration, with few dominant major players generating the majority of industry revenue. In contrast, Canadian industries primed for entry tend to be fragmented and exhibit low levels of market share concentration; these industries are especially appealing if they consistently post revenue growth.
IbisWorld also advises that the Canadian retail sector has exhibited rapid growth in the past five years. Consumers have remained financially confident, with plenty of cash on hand for discretionary purchases. Most are familiar with U.S. stores and frequently cross the border to shop for a broader selection of brands. Furthermore, the Canadian retail sector is a less-crowded field with fewer dominant players.