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More U.S. retailers looking for fresh markets are turning to Canada, lured by their northern neighbor's resilient economy, strong currency and the familiarity with their brands.
Express Inc, a specialty clothing retailer with about 600 U.S. stores, last week opened a Canadian store in Toronto and said it would have six by the end of the year.
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Nordstrom Inc and Kohl's Corp is looking into opening department stores in Canada, though neither has announced plans.
Target Corp, the No.2 U.S. discount retail chain behind Wal-Mart Stores Inc, expects to start opening Canadian stores in 2013.
Many chains see Canada as untapped territory, having nearly run out of promising locations in the United States to open new stores, said retail consultant Wendy Evans.
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"Many of them have reached or are about to reach saturation in the U.S.," said Evans, whose firm, Evans and Co, advises companies on cross-border expansion.
U.S. chains are also looking for ways to counter a poor outlook for retail sales at home because of unemployment and a weak economy.
Home improvement chain Lowe's Cos Inc, which last month reported worse-than-expected quarterly sales, has sought a boost in Canada where it has 28 locations. It has about 1,700 stores in the United States.
"Canada is going well," Lowe's Chief Executive Robert Niblock told Reuters last month. "We have got many more stores in the pipeline."
The United States has nine times as many people as Canada's population of about 34 million.
But compared to a U.S. economy in danger of tipping into a double-dip recession, Canada is holding up much better, even though it is vulnerable to any U.S. slowdown. It also has regained all the jobs lost in the 2008-09 recession.
Its currency has traded at nearly the same value as the U.S. dollar for years, flattering the top lines of retailers that report their results in greenbacks.
Zale Corp, which owns Peoples Jewellers, Canada's largest jewelry chain, said the Canadian dollar added 1 percentage point to its sales gains in established stores last fiscal year.
Zale gets 17 percent of its sales north of the border, where its stores generated on average $1.4 million last year, compared with $1.2 million stateside at its Zales chain.
