Canadian Tire

Canadian Tire

Mariam Hussein, Chris Flint, Natasha Muthu, Rabab Akbar

Presentation Outline

Background

Organization Culture

Organization Structure

Canadian Tire Strategies and Challenges

Canadian Tire Corp. SWOT Analysis

Canadian Tire Corp. Financial Report

Conclusion

References

Background

Canadian Tire, the country's largest hard goods retailer, consists of three business: retail, financial services and gasoline outlets. Including staff on the retail side, the company has 38,000 employees across Canada.

Canadian Tire covers all the corporation's employee programs related to wealth, health, the employee's role, growth, work environment and the community (Felix, 2001).

Under each of these six categories, Canadian Tire offers a broad range of employee programs such as holiday gift boxes to employee retail discounts, annual parties, frequent public recognition, opportunities for training as well as fully paid university tuition and a generous profit sharing and stock purchase plan (Felix, 2001).

Organization Culture

Strive always to make things better

Adapt, innovate and change quickly

Development of their employees

Implements flexible benefits program

Canadian Tire offers a generous health benefit plan along with the flexibility in its health benefits plan and working hours. In fact, a commitment to flexibility is one way Canadian Tire tries to help employees meet the challenges of both their work and family lives. Daily working hours, as well as the number of hours or days of the week that an employee works, accommodate conflicting demands that arise from family responsibilities, commuting as well as fitness and school schedules. Employees can work from home too if the need arises.

Canadian Tire was also one of the first companies in Canada to implement a flexible benefits program. Employees can choose from a range of health benefits, including optional disability and life insurance. They can even use flex dollars to purchase extra vacation days.

Although the profit sharing and stock purchase plans are intended as retirement savings, the company recognizes that employees may have different reasons for saving money. Eligible employees who want to save for a home or pay off an existing mortgage can have a portion of their annual profit sharing award put into a separate personal interest-bearing bank account for that purpose.

Organization Structure

This is a functional structure as it is divided into departments

Organization Structure

Different companies under CTC are Marks, FGL Sports, PartSource and etc. run under a divisional structure

Canadian Tire Strategies and Challenges

Driving, Living, Playing, Fixing

Target market: Young Homeowners

House of Innovation

Franchising all retail stores

Supply chain strategies and challenges

Numerous vendors, third-party logistics

Canadian Tire Corp. SWOT Analysis

Canadian Tire Corp. Financial Report

Canadian Tire revenue increased 3.4% or $76.2 million to $2.3 billion in the 1st quarter.

- First quarter results for the period ended March 29, 2014, show positive sales, revenue and margin growth.

- Consolidated revenue increased 3.8% or $93.3 million in the 1st quarter as a result of higher shipments in key categories at Canadian Tire

- Financial Services selling, general and administrative expenses increased 11.3% in the quarter

Strong second quarter results

- Consolidated diluted EPS up 11.0% or 18.2% on an adjusted basis

- Consolidated revenue increased 4.8% or $145.0 million

Canadian Tire Corp. Financial Report

Consolidated earnings performance reflects strong revenue and gross margin contributions from the Retail segment

- Retail segment revenue increased 4.7% or $129.9 million

- Same store sales up 2.8% at Canadian Tire, 8.2% at FGL Sports and 3.2% at Marks

Solid second quarter performance at Financial Services

- Gross average accounts receivable growth of 7.4%

FINANCIAL SERVICES OVERVIEW

Financial Services continued its strong performance in the quarter. Income before income taxes was $82.2 million, an increase of 6.4% in the quarter compared to Q1 2013 due to higher revenue from gross average receivables and interest expense savings

Conclusion

Canadian Tire Retail is becoming more engaging towards its customers via its online retail and House of Innovation strategies.

CTRs functional structure allows for specialization within departments, to better serve its employees. Franchising to local dealers saves CTR money, while providing customers a more specialized experience.

By focusing on employees and customer satisfaction, Canadian Tire Retail has managed to increase profits while delivering on their plethora of merchandise from tires to housewares and seasonal dcor.

References

Annual Report. 2013. Canadian Tire Corporation Ltd. Retrieved from http://corp.canadiantire.ca/EN/Investors/Documents/2013%20Annual%20Report.pdf

Canadian Tire Corp. 2014. Annual Report 2013; retrieved from http://corp.canadiantire.ca/EN/Investors/Documents/2013%20Annual%20Report.pdf

Canadian Tire Corp. (2014). Corporate Structure; retrieved from http://corp.canadiantire.ca/EN/Investors/Governance/aif/CTC_AIF_2011.pdf

Canadian Tire Corp. (2012). Canadian Tire Corporation, Limited SWOT Analysis. Canadian Tire Corporation Ltd. SWOT Analysis, 1-8

CTC About Us. Retrieved on October 29, 2014 from http://corp.canadiantire.ca/EN/ABOUTUS/Pages/AwardsRecognition.aspx

Felix, S. (2001). The Canadian Tire Way. Benefits Canada, 25(1), 24-29. Retrieved from http://search.proquest.com/docview/224281761?accountid=142373

Financial Post. April 18, 2013. Canadian Tire Reaches Long-Term Agreement with Franchise Dealers. Financial Post. Retrieved from http://business.financialpost.com/2013/04/18/canadian-tire-reaches-long-term-agreement-with-franchise-dealers/

Hartley, M., & Shaw, H. March 21, 2013. Canadian Tire Sets Up Shop in Communitech to Start Thinking Like a Startup. Financial Post. Retrieved from http://business.financialpost.com/2013/03/21/canadian-tire-sets-up-shop-in-communitech-to-start-thinking-like-a-startup/?__lsa=c101-e063

Horn, J. (2011). Canadian Tire Plays House. Strategy, 9. Retrieved from http://search.proquest.com/docview/1458457202?accountid=142373

MBA. Canadian Tire SWOT Analysis. MBA Skool. Retrieved on November 2, 2014 from http://www.mbaskool.com/brandguide/lifestyle-and-retail/4307-canadian-tire.html

Power, M. (2011). Sustaining Value. Purchasing B2B, 53(4), 14-18. Retrieved from http://search.proquest.com/docview/878742707?accountid=142373

Smyrlis, L. (2010). Rewriting the Book on Supply Chain Management. Canadian Transportation Logistics, 113(1), 26-27. Retrieved from http://search.proquest.com/docview/203022595?accountid=142373

Williams, N. (2006). Finalist Canadian Tire: Canadian Idol no, You're Not Mistaken That Fresh-Faced Brand is Old-Timer Canadian Tire. Strategy, 42. Retrieved from http://search.proquest.com/docview/214173947?accountid=142373

Strength Weakness

1. Presence in different categories like

online, automotive, financial services

2. Canada's largest retailer

3. High accessibility of stores by

consumers

4. The world's first hard go ods retailer to

begin selling gasoline at their stores as a

means of driving customer traffic.

5. Attractive promotional offers

6. High presence in domestic market

1. Not known globally compared to some

other brands

2. Market share is limited due to

competitive segment

Opportunity Threats

1. Expand globally into other countries

other than Canada

2. Large brand awareness so could leverage

on it.

1. Competitors global presence

2. Consumers are not habituated of buying

different categories like automotive and

gifts under one roof

3. Low priced brand perceived to be of low

quality in Indian consumer minds