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George StroumboulopoulosAnthony Jenkins/The Globe and Mail

The Canadian Broadcasting Corp. is getting out of its unprofitable retail business, and plans to sell its bobbleheads and retro T-shirts online rather than in its lobbies.

The public broadcaster confirmed late Tuesday it would shutter its storefronts in Vancouver and Toronto, which have been open since 2004 and have never been able to turn a consistent profit. It plans to offer its wares – including T-shirts, mugs and bags – online and through retailers such as Chapters and Renaud-Bray.

Ten employees will lose their jobs, and the closings are effective immediately. Financial details of the retail operation were not immediately available, although its most recent quarterly report listed its merchandising inventory at $811,000 at the end of March.

"Unfortunately, the current business model has not proven to be profitable overall for CBC," an internal memo informed employees. "This new approach will eliminate the financial risk to CBC and offer higher profit margins – profits that can be reinvested in our programming."

The CBC was one of its own biggest customers. It spent a half-million dollars over the last four years on promotional giveaways for its employees and fans, according to documents made available through an access to information request, and most of the purchases were made from the stores (which were on street level in each building's lobby).

"The CBC Shops will move to a different business model that will continue to make high quality CBC merchandise available online and through major Canadian retailers," the memo stated.

The documents show the publicly funded broadcaster is a frequent customer at its own retail outlet, with hundreds of small purchases adding up to hundreds of thousands of dollars in expenses. The items cover the full range of the store's inventory, from $7 for one "Hockey Night in Canada Retro Beanie" to just over $1,000 for 252 George Stroumboulopoulos coffee mugs.

The most expensive trip to the store last year was a bulk purchase of 284 Stroumboulopoulos bobbleheads for $3,124. Other large buys in 2012 included 15 "CBC Music 8GB iPods" for $3,073, and 175 "Retro CBC Mobile Reporting Bags" for a total cost of $3,020.

The items are frequently used as prizes on its radio and television shows, and are also distributed internally as employee incentives.

The costs have jumped considerably. In 2009, the broadcaster spent $20,802 on the items. Last year, it had increased 550 per cent to $135,278 (although that was $50,000 less than the broadcaster spent the year prior).

Anyone who wants to give away an item from the company's vast inventory needs to seek the approval of a senior manager, spokesman Chuck Thompson said, but there are no policies about when it's appropriate to give something away.

"The promotional items were bought from the CBC shop for the public, advertising partners, sponsors and on occasion for employees to mark significant milestones," Mr. Thompson said. "[They are] discretionary but obviously with good judgement and any purchase must be approved by the supervising manager."

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