I don’t know much about the details, but I would be surprised if in the case of HBC it weren’t mostly a case of personnel. I think it takes vision and really hard work to build a retail chain that works, and when’s the last time that really happened in Canada?

To make something work is going to take a lot of effort. I think they’re going to have to re-differentiate the large flagship stores from the smaller ones, and keep those distinguised from their moribund Zeller’s franchise (or sell it off). Put them under the HBC name – ditch that freaking Bay logo and name, or reserve it for mall anchor stores – and then get to work on the buying end. They should be able to use their buying clout to strengthen the high end and the low end. I doubt that happens now, because it’s all low end.

Ottawa needs a Simons…soon.

But seriously, the old monolithic retailers are being overtaken by a) other monolithic retailers that learned how to become nimble and specialized, and b) small niche specialty stores.

The one thing the Bay sells that everyone gets a Bay credit card for is Big Four appliances (which under the hood are the same machines that Sears sells, rebadged). They’re squeezed on the luxury high end by Holt Renfrew, on the low end by their own brands (don’t get me started on how directionless Zellers is) and discount retailers. In big cities, anyway, their role as the ‘everything’ general store has been usurped. It’s probably different in smaller cities and towns, where they are regional meccas of a sort…but even those are falling to “power centres” and other branded outlet malls.

Apparently under this new regime about half the old Bay stores may get bought by Federated Department Stores – so here comes Macy’s or Bloomingdales – another bidder might be up-and-coming regional chain, Kohl’s. I’m sure some Zellers will become Targets before long.

But what of the old flagship stores? well, unless they want to make a real leap into Internet sales, and/or make financial services their central stated premise — make the Bay card relevant – make it a universal credit card, partner with VISA or Interac for services – I suspect they’re going to have to take a long, hard look at what sort of niche they need to occupy now. If they want retail to shine, then they need to shed a lot of pointless departments (travel agencies? hair salons?), revamping moribund ones (make that candy counter world class, the toy section should rival FAO Schwarz), and really rethink their buying practices – who wants no-name sweaters when you can go to the Gap? who wants no-name furniture when you have Ikea already? tailor them to regional or specific urban contexts…