Canadian discount retailer Zellers may be making a comeback in Ottawa as the brand pursues national expansion following the success of its new Edmonton store.
In late October, Zellers opened a new standalone location at Londonderry Mall in Edmonton.
“Launching our first store exceeded our expectations in every way,” Joey Benitah, chief operating officer of Zellers, said in a press release Thursday. “The excitement we saw on opening day has continued well beyond the launch, with consistent customer traffic, overwhelmingly positive feedback, and sales performance that continues to surpass our internal targets.”
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The opening also marked the official in-store reveal of Zeddy, the store’s mascot.
This week, the retailer said it’s “actively pursuing new leasing opportunities across Canada” and is “focused on securing locations in every major Canadian market, with flexibility at the core of its real estate approach to ensure thoughtful, sustainable growth.”
Though Zellers remains mum on where future stores will be located, retail analyst Bruce Winder told OBJ Friday that he believes Ottawa will be on the list of future markets.
“If one assumes that they’re going to roll out the concept carefully to major markets in Canada, I think it’s fair to assume that Ottawa would be one of those markets,” he said. “Now, I don’t know if it would be one store or two stores. It would depend on how quickly they want to expand.”
If the retailer were to come back to Ottawa, Winder said there is a chance it may take over one or more of the former Hudson’s Bay locations, though perhaps not downtown.
“It’s very much a value-based business model. I would assume that they might look at more economical real estate to make the numbers work … They’re also going to have to look for a value demographic, perhaps (in) malls outside of (downtown) Ottawa in the suburbs,” he said.
Winder said Zellers might see success based on the fact that it’s a recognizable brand to Canadians.
“There’s a high sort of nostalgia feel for Zellers, particularly around the restaurant, which I don’t think is coming back, but also Zeddy. Canadians grew up with Zellers … You’ve got an awareness that’s already there.”
While nostalgia may be a contributing factor, Winder said Zellers shouldn’t put all its eggs in one basket.
“This might hit the sweet spot, as long as they don’t bet on the nostalgia piece being a big part of it, because, at the end of the day, Canadians like nostalgia but they’ve got to make ends meet and they’re not going to pay more for nostalgia.”
Winder added that Zellers may seem more attractive to Canadian shoppers as inflation pushes them to be more mindful of their spending.
“There’s a lot of people who are watching their money right now, who are having a hard time making ends meet. What this offers is an alternate (that is) above Dollarama and Giant Tiger but below Walmart. There is an apparent appetite for value merchandise in Canada right now,” Winder said.
The original concept for Zellers was established in Ontario in the 1920s, with a revival of the brand in 1931. In 1978, HBC bought a majority stake in the company and picked up the remaining interest in 1981. At its peak, Zellers had 350 stores across Canada.
Mounting competitive pressures forced the company to sell many of its leases to American retailer Target and to close the rest of its stores by 2013. The last Ottawa location closed in 2020.
Small “shop-in-shop” Zellers sections were opened inside HBC stores in 2023, but they closed along with HBC locations last year.
Benitah’s family has owned clothing chains like Fairweather and International Clothiers as well as houseware brands Bombay and Bowring. Les Ailes de la Mode Inc., a company the family owns that shares its name with a department store they once ran, acquired the Zellers name, its logo and the rights to mascot bear Zeddy, loyalty program Club Z and the Zellers portrait studio in August 2025.
Calling this recent expansion project “Zellers 3.0,” the company said this week it will consist of “a small-format department store blending heritage with contemporary design,” selling men’s, women’s and children’s apparel, footwear, accessories and home essentials.
In October last year, Benitah said he has initially targeted former HBC properties and has been signing leases with landlords for single floors or portions of the space the department store once held that measure no more than 50,000 square feet.
– With files from The Canadian Press
