[2] However, fierce competition and an inability to adapt during the early stages of the retail apocalypse resulted in Zellers losing significant ground in the 2000s.

While HBC initially retained 64 Zellers locations, it announced on July 26, 2012, that all of them would be liquidated and closed by March 31, 2013, due to their lack of profitability.

[4] As of 2023 however, the Zellers brand name has been formally reintroduced as a store-within-a-store concept inside Hudson's Bay department stores, complemented by online shopping.

Within months, Zellers was doing such good business that they were bought out by the American firm Schulte-United Ltd, but within two years, the rebranded stores went bankrupt.

[8] During this period of expansion, Zellers concluded a deal with W. T. Grant, a similar chain of American mass merchandise department stores.

[8] In exchange, the Grant Company made available to Zellers its experience in merchandising, real estate, store development, and general administration.

Zellers employees were sent to Grant stores and head office for training and the two companies made common buying trips to East Asia.

In 1976, Fields, a clothing retailer based in Vancouver, British Columbia, offered to purchase a 50.1 percent stake in Zellers for $32,675,000.

Counterfeit video games for the Atari 2600 console were manufactured in Taiwan and sold by Zellers in the early 1980s, usually under new names and artwork and occasionally with modified graphics.

[13] In 1990, Hudson's Bay Company acquired the 51 stores of the Towers/Bonimart chain from the Oshawa Group,[14] and converted most of them to Zellers outlets, including its flagship location in the Scarborough district of Toronto.

[20][36] In addition, the United Food and Commercial Workers Union planned to hold demonstrations as many Zellers staffers were to be laid off instead of being retained by Target or Walmart.

Foote focused on raising profits, even if that meant losing market share and reducing store traffic, by ramping up inventory levels of higher margin goods over loss leaders such as apparel over deeply discounted paper towels and detergent, and by slashing costs.

[38] The Hudson's Bay Company announced on July 26, 2012, that it would close most of the 64 remaining stores that were supposed to continue operating as Zellers outlets.

A company spokesperson stated that these stores employ 6,400 people, or approximately 100 per location, range in size from 48,000 to 128,000 square feet and are mostly in small towns.

The closings of these stores were to happen at the latest on March 31, 2013 which coincided with the deadline date the HBC had to vacate the sites acquired by Target.

[29][39][40][41] The HBC also remarked that it would not be viable to keep Zellers as an ongoing chain due to the geographical locations of the remaining 64 stores.

With HBC preparing an initial public offering in late 2012, it either terminated these liabilities with landlords at steep discounts or found new tenants to sublet the space.

[44][36] After HBC decided not to continue Zellers with the remaining 64 stores, these locations started their liquidation sale on December 26, 2012 and the company stopped accepting returns on January 31, 2013.

In January 2013, HBC revised its strategy and decided to keep a total of three stores open under the Zellers banner after March 31, 2013.

Replacing it was a previously closed Zellers in the Ottawa community of Nepean, which reopened on April 3, 2014, keeping the number of stores at three.

[54][55][56] In September 2021, as a pilot project, HBC relaunched the Zellers brand as a pop-up shop within a Hudson's Bay department store at the Burlington Centre mall in Ontario.

[9] Essentially a store-within-a-store concept, it sported hanging Zellers logo banners, the classic red-and-white painted walls colour scheme, and red floor lines to mark off one small section within the Hudsons Bay store.

While offering a limited selection of goods, including Canada-branded apparel, bedding, housewares and toys, it mainly was intended to invoke a "fun and nostalgic experience" according to HBC.

[58] Subsequent reporting by trade publication Retail Insider indicated the pop-up location may have been prompted by trademark filings by an unrelated group that had opened two stores under the Zellers (as well as Kmart Canada) brands, after HBC allowed a trademark on the Zellers logo to expire in 2020; HBC is suing the group to prevent what it alleges to be unauthorized use of a brand that it still controls.

[59] Some retail analysts believe the re-introduction of Zellers is primarily due to HBC's lawsuit over protection of its trademark, using this as a demonstration of ownership of the brand, and doubts any successful expansion or revitalization of the former chain.

[60] In March 2023, HBC formally brought back the Zellers brand as an e-commerce website and physical space within 12 select Hudson's Bay stores in Ontario and Alberta.

[62] After another wave of openings in August, it was announced in September 2023 that the totality of Hudson's Bay locations will have Zellers spaces by the end of the month.

In July 2010, Zellers unveiled prototype store designs in five Winnipeg locations, with two more originally planned for late 2010 and early 2011.

It was also possible to record a radio commercial for Zellers Moonlight Madness sale by using a computer microphone and reading the site's teleprompter.

[71] During the Festive Finale campaign in 2011, Zeddy was reintroduced in weekly flyers for Zellers Toyland before closing their stores for Target or Walmart.