Yet another Canadian retail sector is about to experience intense competitive pressures at the hands of a so-called ‘category killer’ superstore chain.

Michaels of Canada, which will sell arts, crafts and decorations, plans to open two 20,000-square-foot outlets in southwestern Ontario this October.

Each store will be about 10 times larger than the typical Canadian arts and crafts store and will carry more than 30,000 different items.

Michaels parent company is u.s.-based Michaels Stores, which operates 186 arts and crafts superstores in 27 states.

Annette Vershuren, president of Michaels of Canada, says the new stores, to be located in Oakville and Burlington, are the first of 20 outlets that will be opened across the country over the next five years.

Five of those openings are slated to take place in 1994.

Vershuren says Michaels will be aggressive in its pursuit of market share, but she predicts the appearance of the chain will prove beneficial to everyone participating in the category.

‘I believe Michaels will draw attention to arts and crafts and get people excited,’ she says, adding the chain will introduce new products to the country and encourage people to discover arts and crafts as a hobby and a pastime.

Vershuren notes some people mistakenly label Michaels as a warehouse-style discount store.

She describes it as a ‘destination’ store, where there is ‘interaction between the consumers, associates [staff] and products.’

Stealing a page from the marketing handbook of its u.s. parent, she says Michaels will offer a high level of customer service in addition to a regular schedule of in-store classes and demonstrations.

As part of its efforts to meet the needs of its customers, Michaels in the u.s. publishes a magazine and runs a children’s arts and crafts program.

Vershuren says she intends to do the same here.

According to Michaels, arts and crafts retailers in the u.s. sell $7 billion worth of goods annually.

Canadian sales are believed to be underdeveloped compared with u.s. sales.

Michaels of Canada is a joint venture between Michaels Stores, Vershuren, Brian McDowell and Jerry Payton, the latter two being u.s. retail veterans with experience in Kmart, Wal-Mart and Michaels Stores.

Cape Breton, n.s.-born Vershuren, who has a background in business planning, was the catalyst behind Michaels’ decision to invest in the Canadian market.

In 1989, she joined Toronto-based Imasco as vice-president of corporate development.

Two years later, the company granted her request for an opportunity to gain experience in retail by naming her head of its Den for Men chain.

Vershuren says shortly after joining Den for Men, she became convinced she wanted to stay in retail, so she began to think about going into business for herself.

In 1992, Vershuren left Den for Men and began prospecting in the u.s., eventually identifying five chains she thought would transfer well into the Canadian scene.

Ultimately, she decided on Michaels and presented its owners with a business plan.

Vershuren says that while the owners previously had no intention of expanding into Canada at this time, they liked what they saw and agreed to back the venture with a large enough investment to make Michaels Stores the majority owner of Michaels of Canada.

Michaels’ chief competitor in Canada is Lewiscraft, a 78-store national chain that plans to opens its first superstore in August.

The 12,500 sq-ft. outlet is located in London, Ont.

Lewiscraft says it will open 20 to 30 similar outlets in major Canadian centres in the next few years.

After Lewiscraft, the competition fragments among mom-and-pop stores specializing in the category and dedicated arts and crafts departments within larger stores.

For example, the White Rose Crafts and Nursery Sales chain is known primarily as a nursery although it also carries a wide selection of arts and crafts.

Vershuren says the October openings of her first two Michaels stores will be backed by a brand-building campaign featuring ‘some tv and possibly some radio.’

As well, she says Michaels’ on-going marketing strategy will be to ‘penetrate the markets surrounding the stores on a continual basis.’

Michael’s ad agency is Toronto’s Hamel Communications Marketing.