Canadian retailer Roots Corp. has bumped up prices and reined in promotions as it contends with ongoing inflation and prepares to reintroduce Beaver Canoe.
Roots president and CEO Meghan Roach said the chain took a small price increase on its core products and saw "no impact on consumer shopping behaviour with us."
"With a history spanning almost five decades, Roots retains many loyal followers and a highly attractive customer base that has shown a willingness to pay for the unique features and benefits we offer," she said during a conference call to discuss the retailer's first-quarter results.
It's that devoted customer base the retailer is targeting with the return of Beaver Canoe, a 1980s outdoorsy wardrobe staple with a diamond-shaped logo featuring a beaver and trees.
The brand will be relaunched this summer to celebrate its 40th anniversary, Roach said.
The Beaver Canoe brand was reintroduced a decade ago as part of its 30th anniversary, and was briefly sold under licence to Target Canada. Vintage Beaver Canoe apparel also continues to sell through online marketplaces.
The 2022 relaunch comes less than a year after MEC introduced its anniversary collection and as brands like MAC Cosmetics launch 1980s-inspired products amid a wave of Stranger Things-inspired nostalgia.
The company, which sells apparel, leather goods, footwear and accessories, posted $43.1 million in sales in its most recent quarter, up from $37.3 million in the same quarter last year.
The increase reflects the full opening of all of its stores during the quarter, compared with about 70 per cent a year ago during a partial lockdown caused by the pandemic.
Roots has also scaled back promotions — sales and discounts that typically erode margins in the retail industry.
"We haven't really seen significant resistance from customers since we've removed promotions," said Mona Kennedy, chief financial officer of Roots.
The company has recorded higher input costs, with volatile cotton prices and higher fuel and freight bills driving up costs.
"We have taken some strategic price increases in the first half of the year and may do so in the second year to offset (higher costs)," Kennedy said.
Overall, Roots reported a first-quarter loss of $5.3 million compared with a loss of $4.9 million in the same quarter a year earlier.
The loss amounted to 13 cents per share for the quarter ended April 30 compared with a loss of 12 cents per share a year ago, the company said.
Direct-to-consumer sales amounted to $37.4 million, up from $31.4 million a year ago, while partner and other sales totalled $5.7 million, down from $5.9 million.
Roots said the slight decline was related to a reduction in the company's Asia business in Taiwan, which was higher a year ago due to a shift in timing of wholesale orders, partially offset by growth in sales of custom Roots-branded products to business clients and sales through TMall.com in China.
Meanwhile, the Toronto-based retail company is extending the sizes it offers across its apparel collections.
This report by The Canadian Press was first published June 14, 2022.
Companies in this story: (TSX:ROOT)
Brett Bundale, The Canadian Press
