April 04, 2012
radio commercial, circa 1960
Towers Department Stores History
- Towers Marts of Canada brought the chain discount store concept
to Canada in November of 1960. A crash building program would open
12 discount plaza units of 100,00 square feet each in just over two
year. In Quebec, the stores went under the Bonimart banner.
The first store was opened at the corner of Lawrence Ave. East and
Midland Ave. Each selling department within a Towers store was
operated as a licensed concession.
- Read Elayne Freeman's first hand
account of opening day
- Talks are underway to open gasoline outlets at Towers Department
- A new store opens (the third) at Bloor and Dundas
Sts. On the opening day, the first 1,000 customers were sold silver
dollars at 80 cents each. Seven sets of triplets, ranging in age
from 3 to 24, took part in the opening ceremonies. They helped Ben
Rosenberg, president of Towers Marts and Prooerties Ltd. fill a time capsule
and photographs and newspapers. The capsule will remain buried until
2062. [Editor's note: I wonder what happened to it?} Donald Jaffey,
president Allied Towers Merchants, said that centralizing
warehousing, bookkeeping and inventory control will help streamline
- Allied Towers Merchants Limited offers shares in this May 23
announcement in the Star.
- Shares of discount department store operator Towers Marts and
Properties Ltd. drop from a high of $9 to a level of $1 per share.
Ben Rosenberg, president of Towers Marts and Properties store chain,
announces March 6 that Towers is in receivership. Twelve of Towers'
13 stores are making money, he says. Attempting to cut costs, he
announces that Allied Towers Merchants Ltd. has just taken over
merchandising, cashiering and other in-store operations.
- The Star reports on May 29 that Allied Towers Merchants suffered
a $268,492 net loss for 1962. Three months earlier, Allied Towers
assumed the merchandising functions formerly done by Towers Marts
- Bankruptcy trustee J.L. Biddell comments on the affairs of
Towers Marts and Properties Ltd. "(They are) the most complicated
matter I have ever been connected with." About 120 creditors
consider a proposal that would keep the company in business.
- M.W. Book is elected president and general manager of Allied
- Maxwell Goldhar is appointed president and a director of Towers
Marts and Properties Ltd.
- Sales of Allied Towers Merchants Ltd. in the first seven months
compare favourably with 1963 figures.
- Oshawa Wholesale Makes Offer For
Allied Towers Share Back
(Montreal Gazette, December 4, 1965)
Oshawa Wholesale Ltd. and W. L. Atkinson, a director of Allied
Towers Merchant Ltd., have made an offer of 60 cents a share for
753,750 shares of Allied Towers held under voting trust agreement by
Towers Marts & Properties Ltd.
The offer is subject to approval of Towers Marts & Properties
shareholders at a meeting to be held Dec. 13. It is conditional on
tendering of at least 250,000 shares and will expire Dec. 15.
At last report Allied Towers Merchants had 1,731,516 common shares
outstanding of 3,000,000 authorized.
Allied Towers Merchants operates on a rental and lease basis the
stores of Towers Marts & Properties in Ontario and Quebec Towers
Marts wnet into receivership in 1963.
- Oshawa diversified into general merchandise retailing in
January, 1966 when it purchased a 75% interest and took over
management of the six-store Rite-Way Department Store chain, which
operated throughout Ontario. A year later the company acquired the
rest of Rite-Way's shares and purchased Allied Towers Merchants
Ltd., another department store chain, combining the operations of
the two under one management group.
- In 1968 Oshawa purchased
Rockower of Canada Ltd., a firm which
operated the men's and boys' departments in 26 of Oshawa's Towers
- The Richelieu Valley will have its
first one-stop regional shopping centre... Place St. Jean, a
$4,300,000 fully enclosed shopping complex, will contain a discount
department store... It will contain a 66,000 square-foot Les
Galeries Towers department store...
- Sudbury City Centre, with retail,
hotel and offices developed by Marchland Holdings, opens. It is
built around a Towers-Food City combination.
- There are ten department store chains
in Ontario and a handful of independents. The big ten are Bay,
Eaton's, Gem, K-Mart, Miracle Mart, Riteway, Simpson's,
Simpsons-Sears, Towers and Woolco.
- Toronto Star for October 5 reports that Eaton's, Simpsons, The
Bay and Towers will be open for the Thanksgiving Monday.
- In the October 27 edition of the Star, "a fight's shaping up
over extended store hours."
- In Canada, the Oshawa group introduces a hypermarket (department
and grocery store together) near Montreal and calls it
It was 268,000 square feet, with 60 checkouts and 3,000 parking
spaces. It was not a success. These “malls without walls” have a
high learning curve for their operators, particularly if they are
going from food to general merchandise.
- Falsely accused shoplifter at Towers Brantford store awarded
over $80,000 by the Ontario Supreme Court.
- Multi-Malls opens in Blandford Square
(just outside Woodstock) and in 1978 opens Norfolk Mall (just
A decade earlier, Towers/Food City combinations had proceeded
Multi-Malls, with little trouble and little debate. But the Oshawa
Group anchors were not accompanied by small stores in Woodstock
(1968), Peterborough (1965), St. Catharines (1965), Owen Sound,
Westminster (1967), Niagara Falls (1965), Brantford, Aldershot
(1968), and elsewhere. Indeed, the Towers department store was
basically a group of jobbers (independent merchants), so no more
specialty stores were needed (or advisable, from a landlord
perspective) under the Towers/Food City combination.
A blizzard of government restraining orders were issued against
Multi-Malls: in the case of Blandford Square, one was issued for the
wrong location and by the time the Provincial government noticed its
mistake, Multi-Malls had its building permit.
- The Kipling and Queensway Towers store is robbed by two men who
climbed to the roof of the store and down a vent. Over $5,000 in
men's watches and clothes are taken.
- Coles Book Stores Ltd., once had a connection with Towers - they
operated the toy, games and stationery concessions.
- Towers Department Stores joins with Hudson's Bay Co., the Great
Atlantic and Pacific Co. of Canada, F.W. Woolworth and Gambles to
create The Retail Research Foundation of Canada - a non-profit
organization that conducts quality, specification and safety tests
on a variety of products that retailers propose to sell to Canadian
- Former Vice President of Towers pleads
guilty to fraud.
Towers Head Office moves from Orfus Road
to Airport Road in Mississauga.
Kent Drugs Ltd., a wholly owned
subsidiary of the Oshawa Group Ltd. operating under the name Drug
City, buys the assets of Metro Drugs Manitoba Ltd.
- Ray Wolfe, chairman and president of
of Oshawa Group Ltd.,
announces that sales have increased 11.7 per cent to $2.12 billion.
This despite the lower profit from Towers Department Stores.
- Don Beaumont, vice-president of Marketing for Towers concedes
competition for toy sales from Toys "R" Us will likely be something
to be reckoned with. "We've watched them for many years and have
developed a healthy respect for them but Canada is another market,
another world. Many prosperous American businesses have moved to
Canada and have not enjoyed similar success."
- Larry J. Crystal is appointed
General Manager of the Restaurant Division
- Shoppers are advised not to
shop at the Riverdale Plaza or
Galleria Shopping Centre stores. The reason? If you want to cash a cheque there you are going to have your photo taken.
- Oshawa Group profit is up. Towers Department Stores helps out.
- Towers, and other retailers, remove fake 'Cabbage Patch' dolls
from their shelves.
Receives $128 refund for
Wayne Cammack appointed Vice President Information Systems.
The Towers Department Stores unit
of Oshawa Group Ltd. of Toronto is being more heavily promoted as a family
shopping chain with a new slogan and campaign developed by Saffer Cravit and
Freedman Advertising Ltd., also of Toronto. Photos of Towers employees with
their families will support the new slogan, "We're
part of the family," which will be used in fliers and on radio and
Globe & Mail (Toronto, Canada). (Feb. 6, 1985)
- W.L. Atkinson, president and chief executive officer of Towers
Department Stores Inc. is named to the Peel Region's first Junior
Achievement board of governors.
- Max Wolfe, founder of the Oshawa Group Ltd., passes away. He was
a grocer and businessman born in Lithuania in 1893 and raised near
Newmarket, Ontario. At age 16, with $25 cash and a $60 loan, he
bought a horse, wagon and load of apples and went into business. In
1914, he launched Ontario Produce Co. with his brother Maurice to
supply army bases. The operation expanded to become known as the
Oshawa Group Ltd. and at his death it included IGA, Food City, Dutch
Boy, Towers Department Stores and Drug City.
Tom Spayde develops prototype
retail design concept for Towers Department Stores (Toronto) and led
concept integration into Halifax, N.S. flagship location
- Towers looks for experienced retail department managers for
"...our new 'Store of the Future' in Newmarket opening early 1989.
[Editor's note: This store never opened.]
13 are charged in Towers store
promotion - Police say at least 13 people knew they could splurge on big purchases
without paying a cent. All of them had
scratch-and-save cards which, when checked by the sales clerks, showed they had
won a 100-per-cent discount and would get the goods free.
- William L. Atkinson,
President and Chief Executive Officer of Towers Department Stores Inc. announces
the appointments of Donald A. Beaumont as Executive Vice President and Chief
Operating Officer, and William Douglas as Vice President Marketing.
- The October 4 edition of the Star reports that Woolworth Corp.
of New York is interested in putting in a offer for Towers, despite
Hudson's Bay Co. signed letter of intent to buy the 51-outlet
operation from the Oshawa Group.
- Globe and Mail article "A bidding war
could erupt for the Towers department store chain run by Toronto's
Oshawa Group Ltd."
- The Toronto Star, on October 23, reports that "Oshawa, Hudson's
Bay seal pact on store sale." While details are sketchy, a "definite
agreement to sell its bargain-basement Towers and Bominart
department store operations" for between $100 million and $150
million has been reached.
- October 15 edition of Discount Store
News reports that "Zellers, Woolworth face off for control of
Towers - Zellers Inc. and Woolworth Corp. bid for Towers Department
- The November 5 edition of Discount Store News reports that “Zeller's
parent gobbles up Towers - Hudson Bay Company buys Towers Department Stores Inc.
from Oshawa Group Ltd., Zeller's Inc.”
- On November 16, the Star reports that "Hudson's Bay to expand
- Zellers buys Towers/Bonimart from the Oshawa Group, 51 stores
for $181.5 million ($3.6 million per store, or some $60 per square
foot). Zellers buys another half billion dollars in sales and gets
an 18 percent market share. President Paul Walters predicts Zellers
will overtake Sears in 1991 sales. He also promises that Zellers
will remain headquartered in Montreal ("Our roots are here; we
wouldn't think of changing that"). Towers is doing some $90 per
square foot. The Zellers marketing will bring most of the stores up
to the Zellers productivity. [Ed. note.
Zellers clinches deal to take over
Towers Hudson's Bay beats out Woolworth. Ross Cowan, retail
analyst for Levesque Beaubien Geoffrion Inc., estimated the price may be up to
$150-million. He described the sale as a good fit. "I think it's a great
opportunity for Zellers."
Beaumont, Executive Vice President and Chief Operating Officer of Towers
Department Stores Inc., announces the appointment of Al Leblanc as Vice
move that surprised the industry here, Oshawa Group said it is getting out of
department store retailing with an agreement to sell its Towers/Bonimart stores
to Hudson's Bay Co.
Speculation is mounting that the giant Zellers Inc. chain is close to buying the
Towers and Bonimart department stores run by Toronto's Oshawa Group Ltd.
Officially, at least, neither side will comment on the prospects for a deal or
even confirm that discussions are going on. "I can't say anything about it,"
said a spokesman for Zellers' Toronto-based parent Hudson's Bay Co.
employees at the Towers/Bonimart office in Toronto and 55 workers at
the Montreal office will be laid off Feb. 9, 1991
of the Towers department store chain by rival Zellers Inc. will cost
at least 430 people their jobs.
Zellers, a Montreal-based unit of Hudson's Bay Co., said yesterday
that it plans to close the Towers merchandising and administration
offices in Toronto and Montreal.
Layoff notices have gone out to about 375 workers in Toronto and 55
in Montreal. The layoffs are effective Feb. 9.
Mergers and Acquisitions
Hudson's Bay Co acquires Oshawa-Towers/Bonimart Stores from Empire
Co Ltd - Detailed Transaction Report
Business Holidays Act (1990) of Ontario originally prohibited most
stores from opening on Sundays. However, there were many exceptions
to these rules (for example, gas stations, convenience stores,
tourist areas). Many store owners who opposed the law decided to
open their stores on Sundays, knowing the fact that they were
breaking the law.
In June 1990, Ontario Supreme Court found the Retail Business
Holidays Act to be unconstitutional. As a result, Ontario had nine
months of open-wide
Sunday shopping, until Ontario
Court of Appeal's reversal of the decision in March 1991.
However, public opposition to Sunday closing continued to rise.
Bowing to public pressure, the Rae government passed the legislation
in June 1992, to permit
Sunday shopping in Ontario.
- Discount Store News reports that “48 Towers due for remake.”
The March 4, 1991 article goes on to detail the conversion. John Urie, Zellers
executive vice president, expects sales of the latest Zellers
prototype stores "...to show double digit percentage increases."
- Toronto Star reports that "Zellers sees banner year, plans
expansion" in its March 6 edition. Paul Walters, Zellers president
and chief executive officer, says "We are not retrenching - not
pulling back and waiting for the storm to blow over. We intend to
dominate the Canadian mass retail market, pure and simple." The
purchase of Towers increased Zellers sales by about $500 million,
Walters said. Analysts indicate that the purchase grew Zellers slice
of the Canadian retail market to about 18 per cent, from 15 per
- The Toronto Star reports, on May 18, that despite the recession,
"Oshawa Group gains after Towers sale."
- Donald A. Beaumont yesterday was appointed president and chief
executive officer of K Mart Canada Ltd., a subsidiary of the K Mart
Corporation, the third-largest American retailer. The new appointee
comes to K Mart Canada from Towers Department Stores, a Canadian
department store chain, with which he was associated since 1977,
most recently as executive vice president and chief operating
officer. He was the Towers vice president of marketing before that.
Before joining Towers, he was with T. Eaton Company Ltd., one of
Canada's largest retailers, for 20 years.
- Zellers comfortable in tough retailing
climate - Retailing Around the World: Endless Possibilities or
Endless Problems? "...while successfully digesting its 6 month old
Towers Department Stores acquisition--the 46 Towers stores it kept
from the 51-unit chain have been fully converted to the Zellers
format--Zellers was also cultivating new retail formats."
- Flea market flourishes where abandoned
Bonimart once stood
- Zellers loses money despite Zellers
benefitting because it
received discounts from suppliers to stock the 47 Towers-Bonimart stores
acquired from Oshawa Group Ltd.
- Laid off Bonimart employees receive
little known benefits from Quebec government
- Oshawa Group uses surplus cash from
sale of Towers stores to buy more IGA
- Announced at Oshawa Group's General
Meeting that two top executives will leave.
Oshawa said Allister Graham, chief executive officer, will retire in
the near future, at which time there will be "an orderly change in
authority at the senior level."
Jonathan Wolfe, president and chief operating officer, also
announced his resignation, after it was revealed that he wasn't
being considered as a successor to Graham.
The company said it has a short list of candidates to replace
Graham, all of whom are from outside the company.
- Staples Inc. Names Edward C. Harsant As President, North
Inc. (NASDAQ: SPLS), the office supplies and services retailer,
today announced it has named Edward C. Harsant, currently president
of its Canadian operation, called The Business Depot, Ltd., to the
newly created position of president, North American Superstores for
- Zellers gives up on old Towers Sudbury
1962, Allied Towers Merchants, Ltd., is now the biggest discount chain
in Canada. The company was originally organized by a group of merchants
holding concessions in a mushrooming chain called Towers Marts
International under the presidency of
Samuel J. Rosenstein. Some
Canadian capital was invested in the company but the chief guidance came
from the principals who had started the chain. Every department was
leased and in the early days there was little real control; available
merchandise was bought in large quantities in the hope that it would
sell. For some months the chain prospered but in the latter part of 1962
trouble developed in regard to real estate payments and merchandising
policies. As a result the company went into receivership in March, 1963.
A group of concessionaries, under the company name of Allied Towers
Merchants Ltd., stepped in as a protective measure to take over on a
contractual basis with the trustees for Towers Marts. The lessees
operated jointly as a landlord taking over the collection of cash,
advertising, and setting general company policy.
President Myrle W. Book says. "We were just low, very low, and it was
not until late in 1964 that we had the situation well in hand. Since
that time our progress has been steady with a very substantial sales
growth. The company produced a sizeable profit for the first time in
1965. We now have 13 units in fast-growing suburban areas and our
current level of sales is far in excess of the national average. One of
the first things we did was to get into very solid planning.
"In our first year of operation we reduced our inventory by over $2
million since a lot of it was three years old. Many of our departments
had been loaded with unacceptable lines which had been bought for
promotion. We got rid of it at any price and dropped many low-end lines.
For example, we were selling thousands of dozens of Japanese brassieres
at 33 cents. We dumped them and put in 87-cent brassieres with excellent
We applied this principle to hundreds of items and it has brought about
better markon, better acceptance, and obviously a greater profit. At the
same time we developed goal planning and merchandise management. For a
long time we could not attract very many good people so it was almost a
one-man band. I am sure that many have gone through the same experience
in trying to find executive talent.
"Although we have traded up, price will always be our predominant
customer attraction. But it is price with style, quality, and downright
good value. We started as a discounter but we now consider ourselves
more of a small promotional department store type of operation. We use
comparable pricing fairly extensively.
In the main our prices range from middle-low to middle-high. Our highest
priced women's coat used to be $49.88 and is now $79.88 but we did not
reach this price in one jump and we cannot do it in all our stores. We
fought our way cautiously. The first area in which we started trading up
was in women's wear. We actually considered leasing this department as
it was one of our greatest losers, however, as a result of careful
merchandising, by 1965 our women's wear department became our greatest
"In 1965, on a very low budget, we managed to redecorate and re-fixture
our stores. We hired a company to set up a complete program of new
signing. We also strengthened our merchandise mix by adding name brands.
After a great deal of negotiation with suppliers we introduced several
of the leading lines of cosmetics which we agreed not to discount. We
have a large furniture and major appliance department including such
brands as RCA and Frigidaire.
"In Canada a whole new upper-middle class has risen in the past 15
years. It consists of educated people in executive, managerial, and
professional occupations earning $8,000 to $9,000 a year and up. This
segment today accounts for half of the consumer market in Canada.
The upper economic bracket now represents about 20 per cent of the
families in large urban areas contrasted with 5 per cent 15 to 20 years
ago. Together, particularly in our Ontario-Quebec market, these two
groups represent 70 per cent of the consumer demand.
How wrong we could have been in our case to have gone to low-end type
merchandise. In Canada 37 per cent of the labor force currently is aged
16 to 31 years. By 1970 this group will comprise about 56 per cent of
the labor force. In 1951 this was 11 per cent. Today in Canada about 25
out of every 100 married women work outside their home. To satisfy the
wants of this dynamic new consumer market presents a tremendous
In April, 1961 Samuel J. Rosenstein, president of Towers Marts, lectured
it the University of Massachusetts Conference on Discounting. At that
time a fierce battle between discount stores for the best locations was
in progress. In his talk Rosenstein said, "Now the question of
competition is a very difficult problem to analyze, because, as
|"We in Towers take a
very clear-cut position on this matter.
For example, we're going into the Washington area with depth.
Washington has a population of a little in excess of two
million, and after very careful economic studies, the type of
which I will exhibit here very shortly, we have decided to put
six stores in the metropolitan Washington area.
We think we have located them strategically.
Now is important for our competition to note that we are going
into this area.
For this reason we take great pains in publicizing these things
and I think that many of the people who know us now know that
when we say we're going into a given area, we go in."
President, Towers Marts
Downs (Real Estate Research
Corp., Chicago) pointed out, it's very hard for anyone to know exactly
who is going into a given area. We in Towers take a very clear-cut
position on this matter. For example, we're going into the Washington
area with depth. Washington has a population of a little in excess of
two million, and after very careful economic studies, the type of which
I will exhibit here very shortly, we have decided to put six stores in
the metropolitan Washington area. We think we have located them
strategically. Now is important for our competition to note that we are
going into this area. For this reason we take great pains in publicizing
these things and I think that many of the people who know us now know
that when we say we're going into a given area, we go in. And when we
specify a time that we're going to be there, we will be there. We will
open with four stores in Washington in the latter part of May, and we
will have two more this fall so that we will have six stores in the
greater Washington area within a very, very limited period of time. This
principle of saturation we feel is healthy for the industry because
unless one of our competitors wants to really come in and have a
knockdown, dragout battle, they will look for another city."
In the New York Times of June 10, 1961 it was announced that Towers
Marts, Inc., of New York and its wholly-owned subsidiary, Towers Marts
of Canada, had made a $25 million transaction for eleven shopping
centers, seven of which would be in Ontario, two in Montreal, and two in
Washington, D.C. The company then operated nine centers in the United
States and one in Toronto.
In May, 1962 Towers Marts filed suit to end its contracts with the
Darling Stores Corporation and Grayson-Robinson Stores, Inc., agent for
Darling in operating the departments. The suit asked for $1 million
damages for breach of contract and the right to terminate agreements
with the defendants to operate women's and children's apparel and
millinery departments in fifteen Towers stores. Towers charged that the
two companies did not cooperate properly in the advertising program and
did not maintain a complete line of seasonable and representative
merchandise at competitive prices. This situation, according to Towers,
jeopardized its customer image. A statement by counsel for
Grayson-Robinson as reported in the New York Times of May 5, 1962 called
the Towers Mart action "without foundation. It was brought primarily,"
counsel said, "because the terms of the existing leases are so
beneficial to Grayson-Robinson Stores, Inc., that Towers now believes it
can secure better terms from others, or by means of this litigation,
from Grayson-Robinson. In fact, Towers is in default in the performance
of its obligations as landlord in vital respects, and large counter
claims are being asserted against Towers by Grayson-Robinson." The
matter was settled in June, 1962 when Towers agreed to pay
Grayson-Robinson $1,384,936 with the understanding that Grayson-Robinson
would give up its right to operate leased departments in present or
future Towers stores. Towers made a payment of $703,590 towards the
In September, 1962 Grayson-Robinson Stores filed suit to collect
$681,346 alleged owing to it by Towers Marts International, Inc. It was
charged that most of the money had been withheld by Towers from the
sales of merchandise in leased departments operated by Grayson-Robinson
in Towers stores. The dispute was finally settled by a payment of
$500,000 by Towers Marts to Grayson-Robinson.
In November, 1962 Towers Marts International sold its Canadian
subsidiary, operating thirteen stores, to a group of investors. The
company also announced that it had withdrawn a proposed public stock
issue of 550,000 shares owing to market conditions. The Wall Street
Journal of February 12, 1963 carried an article stating that Towers
Marts was in temporary financial difficulty owing to expenditures of
more than $500,000 in connection with lawsuits against Grayson-Robinson
In March, 1963 the Towers Marts and Properties, Ltd., the former
Canadian subsidiary, was placed in interim receivership by the Ontario
Supreme Court. This company still owed Towers Marts International an
unsecured debt of $450,000. It was given six months by its creditors to
work out a reorganization.
On April 5, 1963 Towers Marts International filed under Chapter XI of
the Federal Bankruptcy Act listing liabilities of $11,073,146 and assets
of $9,796,000. Liabilities included $2,959,000 in accounts payable to
concessionaires in its stores, all eighteen of which were closed. The
four former Towers Marts in the Washington, D.C. area were acquired by
the Zayre Corporation from the individual owners of the properties.
As it turned out, Towers management was building a house of cards since
the company's stability and the expansion of its physical premises
depended on a sales-lease-back principle. All Towers stores had
commitments in terms of sales-lease-back but nonetheless cash from the
business was used initially to construct the stores. When the stock
market crashed and the Tower's stock issue, which would have raised $5
million, also collapsed, the company never went public. The individuals
who had made the commitments had to renege because their individual
house of cards, so to speak, came tumbling down, or they wanted to
contract so the commitment was withdrawn. Towers Mart money was tied up
and sunk into the real estate and management could not get it out. In
order to keep paying the contractors and to keep the business alive,
money due to lessees was borrowed. Marrud, Inc., the cosmetics lessee it
is said, was "hung up" for approximately a half million dollars;
Rockower, another lessee, lost three quarters of a million.
At any given moment, even in those days, if the principal does not send
out a weekly check to his lessee, he is in trouble. Two weeks can go by
and "you're sitting on a big chunk of money." Customary procedure with
lessees is to settle on Friday for the week ending the previous
Saturday. Some have a schedule of payment on the Wednesday of the second
following week. Suppose this settlement is not made on the Wednesday but
is delayed to the following Monday. You are then talking three weeks of
receipts which has already been taken in without the lessee receiving a
cent. This can happen very quickly as the days and weeks roll by
extremely fast. The check may be a few days late. The lessee controller
forgets to tell his boss. If the boss is not informed, the principal may
be four, five, or even six weeks into a firm's receipts before
management is aware of it. This is exactly what happened with Towers.
There was no way out since there was no permanent money coming in to
replace the temporary money that was supporting these stores.
The Towers organization was not really a merchandising business since
hey merchandised no part of the store — it was merely a real estate
It is conceivable that the Towers management might have pulled through
if they had been able to raise the needed money or if the 1962 crash had
not taken place making it possible to honor the long-term commitments.
On the other hand, not being basically merchandisers, they might have
eventually run into store operational problems. It is a
generally-accepted theory that in building the discount industry the
major lessees play a very important role in supplying operating capital
and know-how but a limited one in terms of time. Eventually — in a
rapidly expanding and successful chain — there comes with few exceptions
a time when there is no place for them since they function as an "extra"
middleman between the manufacturer and the ultimate consumer. If they
are good merchandisers and making good money, then why, reasons the
principal, should that money not accrue to the store operator? If they
are not good and don't see eye to eye with the principals as to how the
store should be run, then they ought not to be there. Negating this
point of view is the fact that some lessees have built up such
extraordinary expertise in their specialties that they can, in very many
instances, provide more profit for their principals for a given
department on a lessee rather than on a self-operated basis. Otherwise
why, one might ask, did the Kresge K Mart management lease out their
men's and boys' wear departments to Unishops on a long-term basis?
Oshawa Group History
The Oshawa Group was one of Canada's largest suppliers of food,
operating in both the wholesale and retail sectors. The company ran 102
supermarkets under a variety of banners, including Food City, IGA, and
Dutch Boy. It was also the largest wholesale supplier to independently
owned IGA stores in Canada. Oshawa was active in the general
merchandwase and pharmaceutical market as well, running 39 Towers
department stores in Ontario, nine Bonimart stores in Quebec, and 156
drugstores under the Pharma Plus, Drug City, and Metro Drugs chains. The
company also operated 25 pharmacy units throughout its department stores
company was originally incorporated in Ontario on June 18, 1957 as
Oshawa Wholesale Ltd., and operated as a distributor to grocery stores
during its first few years.
But as the company grew in the early 1960s, it quickly began to
In 1963 Oshawa purchased a controlling interest in the Dominion Mushroom
Company, a large mushroom growing and packing concern. Earnings
surpassed $1 million in 1963, and Oshawa soon invested heavily in
In September, 1964 the company acquired full control of the Independent
Grocers Alliance (IGA) Distribution Company.
Oshawa diversified into general merchandising retailing in January, 1966
when it purchased a 75% interest and took over management of the
six-store Rite-Way Department Store chain, which operated throughout
A year later the company acquired the rest of Rite-Way's shares and
purchased Allied Towers Merchants Ltd., another department store chain,
combining the operations of the two under one management group.
Oshawa continued its diversification into other businesses and new
geographical areas in the late 1960s.
In July, 1968 the company purchased Kent Drugs Ltd. The acquisition
added about $7 million to Oshawa's annual sales, and Oshawa President
Ray D. Wolfe announced the company's plans to put Kent Drug store units
in new Towers Department stores.
Also in 1968 Oshawa purchased Rockower of Canada Ltd., a firm which
operated the men's and boys' departments in 26 of Oshawa's Towers
Oshawa's food distribution unit was greatly expanded late in the year by
the purchase of Shop & Save Ltd., an IGA supplier in Quebec.
The company branched into Canada's maritime provinces when it acquired
Bolands Ltd., which as supplier to 45 IGA stores in that region had
accounted for about $27 million in sales the previous year.
By the end of its shopping spree Oshawa was the supplier to 325 IGA
stores in five provinces and had become well diversified in the general
merchandise and drug store markets.
In the 1970s Oshawa became more involved in real estate dealings. In
mid-1970 the company purchased an interest in Baxter Estates, a real
estate partnership which owned an apartment building in Winnipeg and a
shopping center in Calgary. (The company sold its interest in Baxter
three years later for a nearly 100% profit).
In November, 1971, three months after it changed its name to The Oshawa
Group Ltd. to reflect its diversity, the company purchased the rest of
Marchland Holdings Ltd., a real estate developer it already half-owned.
At the time of the acquisition Marchland owned four Towers-Food City
shopping centers and a commercial complex in Sudbury, Ontario that
included a shopping mall, hotel, office center, theater, and parking
garage. Oshawa also purchased the remaining third of the modular home
developer Systems Construction Ltd. of Ontario.
In early 1972 Oshawa moved into western Canada by acquiring Codville
Distributors Ltd. Oshawa's bid was accepted over the competing bid of
Westfair Foods Ltd., a subsidiary of George Weston Ltd., because
Oshawa's offer was more attractive to Codville's minority stockholders.
In October, 1973, Harvey S. Wolfe succeeded his brother Raphael Wolfe as
president of Oshawa; Raphael became chairman and CEO.
The Oshawa group introduced the first hypermarket (Hypermarché) in North
America near Montreal in 1973. A hypermarket is a superstore which
combines a supermarket and a department store. The concept has been
created in France, then exported to other countries.
The format was pioneered by Carrefour upon opening its first such store
in 1963 at Sainte-Geneviève-des-Bois, France, In the Americas,
In 1976 Oshawa bought out its partners in the Decairie Square shopping
mall in Montreal. In December, 1977, Norman S. Lipson, former president
of Oshawa's Tower Department Stores unit, pleaded guilty to four counts
of fraud which involved kickbacks of $411,000. Lipson had resigned from
his position in late 1976. He was sentenced to two years' imprisonment
and fined $30,000.
In the late 1970s the Wolfes began to slim Oshawa's operations a bit.
The company shed its 50% interest in the Consumers Distributing Company,
Ltd. in 1978. Consumers Distributing sold brand-name general merchandise
at reduced prices in large, no-frills showrooms; Oshawa had entered into
a joint venture with the limited-service retailer, providing capital for
the chain's expansion eight years before. Oshawa also sold its 90%
interest in Coinamatic Laundry Equipment in late 1978.
The early 1980s saw Oshawa emphasize its core businesses--food
wholesaling and retailing. In 1983 group sales surpassed $2 billion. In
1985 the company strengthened its presence in the Atlantic provinces
when it acquired nine supermarkets and a distribution center in Nova
Scotia from Dominion Stores Ltd. and bought 22 Canada Safeway
supermarkets in the Toronto-Hamilton area.
In 1986, as group sales passed the $3 billion mark, Oshawa divested its
Dominion Mushroom farm due to both erratic earnings and the unit's need
for a major capital reinvestment, and sold its Decairie real estate in
Montreal and its Sudbury shopping center.
In the late 1980s Oshawa took bold steps to improve its food retailing
business. Oshawa's corporate-owned Food City stores took on a new
"streetscape" look. The store layout was intended to resemble an
old-fashioned sidewalk merchant atmosphere, and at the same time appeal
to young urban professionals as well as retirees. Oshawa targeted
upscale consumers wherever possible with specialized services and fancy
For example, in 1987 the company's Thornhill, Ontario Food City
superstore added a kosher deli, bakery, and meat department to appeal to
the community's large Jewish population. By specializing wherever
possible, Oshawa commanded beefier margins on premium products and
In 1988 Oshawa tripled its drug store chain by acquiring the 109 retail
units of Boots Drug Stores for C$45 million. The stores were renamed
Pharma-Plus Drugmarts and joined the 34 Kent Drugs and 12 Metro Drugs
units in operation. The addition helped Oshawa sales to top $4 billion
On November 2, 1998, Empire Company Limited ("Empire") and The Oshawa
Group Limited ("Oshawa") announced that Empire, through Sobeys Inc.
("Sobeys") would acquire all of the voting common shares and Class "A"
non-voting shares of The Oshawa Group Limited. The transaction included
Oshawa's retail and wholesale operations across Canada, with the
exception of the Maritimes. Sobeys also acquired Oshawa's food service
business, SERCA Foodservice Inc. which operates coast-to-coast.
More about the Oshawa Group...
ANOTHER ONE BITES THE DUST:
TURNOVER AND FAILURE AMONG THE LEADING CANADIAN FIRMS, 1973-2003
Parable of the Family Jewels
Observer was a "...quarterly newspaper published by and for the
employees of the Oshawa Group Limited and subsidiary companies" -- which
included, of course, Towers Department Stores.
As an employee of Towers for many years, I would receive the Observer at home,
glance it and toss it.
Except for one edition.
The "Spring Issue. Volume 12, No. 1", published June 1974, I kept for some
reason. And I'm glad I did. It's a unique snap shot of Towers - who was
just promoted, who just got married and who celebrated the birth of a child.
I'm going to pick out this and that from this edition for you to enjoy.
There is, more me at least, an extraordinary photo on this page. It was included
in an article, by Oshawa President Harvey S. Wolfe, that bemoaned the fact that
many small towns still had laws in place that forced businesses to close by 6
The photo is of an opening of a Towers store - a store that opened in, or
before, 1974. I don't know which one. The noticed (and OMG, remember!) the
cashier uniforms and the cash registers.
The uniforms where an outrageous canary yellow colour, with a short mini skirt
and a "beret" cap that had a little "stem" on the top -- like a stem of a pear!
Iona (Hixson) Fevreau for this submission
The cash registers where from a company called Sweda.
Cashiers had to (and I remember this because I had to know how to do this):
Separate the taxable items, from the non-taxable items.
The machine had 7 or 8 columns of vertical buttons, arrange
from zero at the bottom to nine at the top. They were colour coded. These
buttons where mechanical. You had to apply some force to depress each one.
Towers tickets were made up the CLASS, ITEM and PRICE. The
CLASS, or department, would identify a category of products -- like candy.
The ITEM number would identify a specific product in that department -- like
Coffee Crisp chocolate bar.
Cashiers has to enter the each piece of information one a
time. It was commonly referred to as "3-pass" entry.
with the first taxable item, they would press the ITEM button. Then,
moving their index finger swiftly up and down, enter the item number. It
meant (counting from the right) entering the first digit in column 4, the
second digit in column 3, and so on. Experienced cashiers would zip up and
down -- their finger nails making clicky noises as they flew up and down.
Once done entering the item number, they would press the big "ENTER" button
on the far right. The cash register would go ca-chunk. The numbers would
appear (white against a black background) in the mechanical display at the
top of the machine.
Next came the class number. Cashiers would press the
CLASS button and enter (just as described above) this 3-digit number and
press the ENTER button. Ca-chunk.
Finally, the PRICE would be entered.
When the ENTER button was pressed for the last time,
a little bit of the customer receipt would peak out (with that item printed
on it) and, unseen, a computer paper tape on the right side of the machine
would be punched with little dots. (These tapes would be sent in daily for
computer processing at the Head Office.)
The cashier would then move on to the next item.
I don't recall a way of repeating the transaction if a
customer was buying two or three of the same item.
Once all the taxable items were done, the cashier would
press the SUBTOTAL button. Using a chart, the casher would then manually
calculate the tax, press the TAX button and enter the amount.
The cashier would then move on to the non-taxable items.
else happened on the day Towers was officially taken over by Zellers?
October 22, 1990 was the day that Zellers acquired
the 51 Towers-Bonimart discount stores in Eastern Canada for estimated
What else happened on October 22 in Canadian history?
Canada - End of General Motors strike at Oshawa and Boisbriand, as GM
and the CAW settle three-week strike that idled over 46,000 workers
across North America.
New York City - Prime Minister Jean Chrétien joins 200 other world
leaders in New York for three days of festivities marking the 50th
anniversary of the United Nations organization.
Toronto Ontario - Atlanta Braves beat Blue Jays, 7-2, in Game 5 of the
World Series, as Lonnie Smith hits a grand
slam; first American team to win a World Series game outside the US.
Ottawa Ontario - Senate passes Mulroney government bill overhauling the
Unemployment Insurance Fund; employers and workers to shoulder the
Montreal Quebec - Queen Elizabeth II makes a speech in which she praises
the distinct character of Quebec.
Montreal Quebec - Dominion Textile announces it is withdrawing from
South Africa in support of Canada's anti-apartheid policies.
Toronto Ontario - English rock group the Who wrap up their tour with a
concert in Maple Leaf Gardens; last show Keith Moon will play in North
New Brunswick - Richard Bennett Hatfield 1931-1991 leads Progressive
Conservatives to victory in NB election, defeating Liberals under Louis
Ottawa Ontario - Lester Bowles Pearson 1897-1972 named first chairman of
the Board of Governors of the International Development Research Centre;
former Prime Minister.
Ottawa Ontario - Edgar Benson brings down budget; proposes serious
changes to tax savings plans and capital gains; Benson Budget.
Ottawa Ontario - Blanche Margaret Meagher 1911- appointed Canadian
Ambassador to Israel, Halifax-born Meagher Canada's first woman
ambassador; later serves as ambassador to Austria and Sweden.
Ottawa Ontario - Government removes wartime price controls on meat.
Ottawa Ontario - King Government brings in Canadian Citizenship Act to
the House of Commons; becomes law in January, 1947; abolishes 'Canadian
national' or 'British subject' as the legal terms for non-aliens in
Savio River, Italy - Seaforth Highlanders Private Ernest Alva 'Smoky'
Smith shows conspicuous heroism, holding the Savio River crossing
against German counter-attacks and destroying at least two enemy tanks;
awarded the Victoria Cross.
Berlin Germany - Canada signed its first trade treaty with Germany.
Alma Quebec - Alma incorporated.
Montreal Quebec - Patriotic celebration takes place at the National
Monument, to celebrate the mobilization of the 24th Battalion of
Montreal Infantry for service in France.
Montreal Quebec - Laying of the cornerstone of the École des Hautes
Études Commerciales building.
London England - Judicial Committee of the Privy Council rules against
the appeal of Louis Riel's sentence, and he will be hanged in Regina
Nov. 16, 1885.
Toronto Ontario - McGill and U of T play Canada's first college football
game on the University of Toronto lawn; the two teams try to play
annually after that; the first football games under the Canadian
Intercollegiate Athletic Union (CIAU) will be played in 1898.
Montreal Quebec - Failure of the Commercial Bank.
London England - John Rae 1813-1893 arrives in England to claim the
£10,000 British Admiralty prize for discovery of the fate of Sir John
Franklin's expedition; the Hudson's Bay Company explorer, fur trader and
surgeon made four expeditions to the Arctic before meeting an Inuit man
who told him of a group of white men who died of starvation four years
earlier, and sold him some marked silverware and a medal which confirmed
they were remains of the Franklin expedition. Rae will not be awarded
the prize until July, 1856, since his report quotes Inuit statements
that the last survivors had resorted to cannibalism, and many Britons,
including Lady Franklin, insisted that sailors of the Royal Navy would
never do such a thing; therefore Rae was not to be believed.
Toronto Ontario - Founding of Toronto, Hamilton, Niagara, & St.
Catharines Telegraph Company; first telegraph company in Canada.
Verchères Quebec - About a thousand young Patriotes, Les Fils de la
Liberté [Sons of Liberty], go on maneuvres in the outskirts of Montreal,
in preparation for a great meeting the following day at St-Charles
[Grande Assemblée des Six-Comtés à Saint-Charles-sur-le-Richelieu].
Quebec Quebec - Shipbuilder Jean Langlois starts construction of another
Quebec Quebec - Father Charles Raimbault dies at Quebec; first Jesuit in