NEW YORK ( TheStreet) -- Hunting and fishing retailer Cabela's (CAB) has grown across America with its large, destination stores. The additional stores and strong sales per square foot have delivered exceptional returns to patient shareholders. With the company's increased prospects for a hunting and fishing mecca like Canada, investors will continue to be pleased.
For years, Canada's hunting and fishing market has been dominated by small mom and pop shops and catalog sales. Cabela's and privately-held Bass Pro Shops have seen the opportunity and both have aggressive plans to expand in the country. Bass Pro Shops has two Canadian stores, with plans for four more.
Cabela's recently opened its sixth Canadian store with its first Ontario location. From 2007 to 2013, Cabela's took the slow approach to test the Canadian market with a total of four stores. That figure will double by the end of 2014 to eight and will hit double digits by the end of 2015.
Cabela's will face competition from an existing Canadian chain that already recognized the opportunity. Canadian Tire (CDNAF) opened proshops in its stores with hunting and fishing items available in hundreds of locations nationwide. Canadian Tire has the advantage of having locations within 15 minutes of 90% of the Canadian population.
Of course, Cabela's has been able to compete in the U.S. with its large destination stores and that's what it will do in Canada. In fact, the Canadian Tire expansion should show that there is a clear demand for hunting and fishing products if the retailer is willing to redo its store designs to capture additional sales.
In 2014, Cabela's will open three stores in Canada. The following three years each have two scheduled openings for Canada. The stores will range from 50,000 to 70,000 square feet, slightly smaller than most of its American stores. Canadian Tire has 6000 square feet committed to pro shops in some stores. Cabela's will be able to offer a much wider selection and its growing namesake brands.