Sail ends Sportium brand after bankruptcy filing

The outdoor retailer is closing all four of its sports banner's locations as it repositions to emerge from the challenges of the pandemic.

After filing for bankruptcy protection earlier this week, outdoor retailer Sail is closing six of its stores, including all four locations of its Sportium apparel and sports banner.

Sail initially announced that it had filed for protection under the Bankruptcy and Insolvency Act on Monday, which it said would allow for a restructuring process that would reposition the company to meet the challenges of the current retail environment, which have been “accentuated” by the pandemic.

On Thursday, the company revealed that repositioning would include closing all four Sportium stores, closing the banner for good (its ecommerce site will continue operating for “a while,” a press release said). Two Sail stores in Ontario – one in Vaughan and one in Etobicoke – will also close, following liquidation sales that are set to begin soon (both banners have reopened in Quebec and Ontario after spending roughly two months closed due to COVID-19).

The closures will impact roughly 500 employees, though the company said it would make offers to transfer employees to other stores or its distribution centres. After the permanent closures are complete, Sail will have 12 bricks-and-mortar stores remaining.

“For several years now, the retail industry has been undergoing a major transformation characterized, among other things, by an increase in online sales and heightened competition,” said Norman Décarie, president and CEO of Sail. “Unfortunately, the consequences of the pandemic, such as the closure of stores for two months, have added further pressure on our cash flow and financial health. This situation is forcing us to make major decisions to ensure the company’s sustainability.”

Filings say the company’s total debt exceeds $100 million, against roughly $300 million in annual sales last year.

Over the last three years, both the Sail and Sportium banners continued with plans to expand in both Quebec and Ontario, including a a 50,000 sq. ft. Sail location and 70,000 sq. ft. Sportium store. While its retail footprint is characterized by large-format stores meant for more experiential shopping, it also made changes to adapt to other consumer needs that disrupted the retail sector. Last year, the company opened a new distribution centre completely dedicated to fulfilling online orders, which Décarie says demonstrates the company’s commitment to evolving based on market and consumer needs.

Despite positing itself to handle the ecommerce-only world most retailers have been in for the better part of the last three months, demand for products at both banners has been low since the start of the pandemic. For Sail, demand for camping and outdoor equipment has been low, as many public parks and private campgrounds in its main markets have been closed. National parks are currently only open for day use, and not overnight stays. Provincial parks in Quebec began reopening for camping just this week, while Ontario provincial parks have begun “gradual” reopenings that only include day-use activities and backwoods camping. Regardless of being open, public health officials continue to advise against travelling between regions, in order to prevent the spread of COVID-19 from larger urban centres to smaller communities that may not be able to handle the toll of an outbreak.

For Sportium, most organized sports are cancelled, and public recreation facilities are closed.

In addition to the challenges presented by the pandemic, both Sail and Sportium faced new competition in recent years. MEC has remodelled stores and continued to expand its operations in Canada, while French sports retailer Decathlon – which operates similar large-format stores – has opened stores in Quebec and Ontario since entering the market in 2018.