After closing the majority of its stores during the pandemic, Montreal retailer DavidsTea is ready to relaunch the expansion of its store network. DavidsTea plans to settle next year on the site of Royalmount, this future shopping center under construction at the corner of highways 15 and 40 in Montreal.

A letter of intent has been submitted to that effect, says DavidsTea CEO and Chief Brand Officer Sarah Segal.

Three years ago, DavidsTea operated over 230 stores. But after closing them all in March 2020 in response to the pandemic, the company used the Companies’ Creditors Arrangement Act to restructure, leaving it now with only 18 stores nationwide to support a strategy focused on digital and wholesale trade in groceries and pharmacies.

“The in-store experience and in-person discovery is really important. We’re looking for great opportunities where the consumers are,” Sarah Segal said in an interview.

“We want to open more stores in Montreal. We hold discussions. We look in Montreal, but also in other markets where we were present in the past. We can’t wait to open stores, we don’t need 200 stores like before. »

She maintains that the organization is even willing to open stores in the United States again if a great opportunity arises. “We learned a lot to improve, refresh and adapt our stores. »

Sarah Segal does not want to mention an optimal number of stores for the network. She talks about the importance of having a “good” partnership with malls where there is good traffic. She also specifies that she sees attractive figures in several shopping centers across the country.

“We see it starting to come back to Toronto and downtown Montreal,” says Sarah Segal. “But there are still a lot of people who haven’t come back to the office,” she adds.

The increase in the size of the network of establishments is envisaged as online sales fell by 41% at DavidsTea during the months of February, March and April.

Management points out that difficulties surrounding the processing of online orders have created frustration among customers and negatively affected sales in recent months.

The situation prompted executives to send a termination notice to the current fulfillment service provider last week. DavidsTea believes that by handling order fulfillment itself, the company can better support speed of service and quality of experience.

DavidsTea is also renovating several of its existing stores by integrating tea bars, drawing inspiration from the atmosphere observed, for example, in Apple stores. That is to say with tables favoring circulation and discussions.

To boost sales growth, management is also banking on other elements, including the upcoming launch of a mobile shopping app, the launch of new products (ready-to-drink drinks, superfood powders, etc.), and the increased wholesale presence in the United States. Tests will be carried out in the fall in a chain of supermarkets in the American Northeast with more than 400 establishments.

DavidsTea started wholesale five years ago and the company’s products are now available in 3,800 locations.

DavidsTea released its early fiscal performance on Tuesday evening. A net loss of 2 million was recorded for the months of February, March and April, while turnover for the quarter fell by 30% to 14.3 million.

Management says sales continue to be impacted by “adverse economic conditions that are dampening consumer demand.”

DavidsTea stock closed Wednesday at 66 cents on the Toronto Venture Exchange, giving the company an approximate value of $17 million.