Canadian Tire
Individual Assignment 1. What are the key facts as presented in the article?
A few key facts presented in the article are as follows: a. Canadian Tire’s plans to move to smaller sized stores in urban locations in an effort to attract a market they believe is underserviced – sports and outdoor recreational activities b. These decisions were influenced by Target’s arrival in the Canadian market. c. Leasing in urban areas such as malls means greater lease rates. On the contrary, urban areas means greater traffic and can very easily lead to many impulse buyers. d. The smaller stores are set to pilot their sports and outdoor recreation stores to compete against larger similar stores such as Bass Pro shops and Cabela e. Other retailers are also making moves to capture impulse buyers as a result of Target’s expansion and the saturating suburban markets. Canadian Tire’s decision to penetrate this particular market places even more weight on the executives who pushed and agreed for this to happen.
2. If you were acting as an outside consultant for Canadian Tire, what key stratgic problem or problems can you identify?
One problem I find is their lack of experience operating under smaller stores. This is a whole new different ballpark the management team would have to adjust to. Since they are dealing with smaller area space, deciding which inventory to shelf becomes an even more critical task. Which products can entice customers to buy? Do the products that yield the greatest margins get priority? What would attract customers to the store? And so on. A smaller space also means greater storage and related inventory costs. Do they have an accurate and timely inventory information system to track which inventories need to be restocked? Also, most of the outdoor and sports products that Canadian Tire sells are seasonal; again, inventory management is vital.
Furthermore, the lease rates at the locations they
A few key facts presented in the article are as follows: a. Canadian Tire’s plans to move to smaller sized stores in urban locations in an effort to attract a market they believe is underserviced – sports and outdoor recreational activities b. These decisions were influenced by Target’s arrival in the Canadian market. c. Leasing in urban areas such as malls means greater lease rates. On the contrary, urban areas means greater traffic and can very easily lead to many impulse buyers. d. The smaller stores are set to pilot their sports and outdoor recreation stores to compete against larger similar stores such as Bass Pro shops and Cabela e. Other retailers are also making moves to capture impulse buyers as a result of Target’s expansion and the saturating suburban markets. Canadian Tire’s decision to penetrate this particular market places even more weight on the executives who pushed and agreed for this to happen.
2. If you were acting as an outside consultant for Canadian Tire, what key stratgic problem or problems can you identify?
One problem I find is their lack of experience operating under smaller stores. This is a whole new different ballpark the management team would have to adjust to. Since they are dealing with smaller area space, deciding which inventory to shelf becomes an even more critical task. Which products can entice customers to buy? Do the products that yield the greatest margins get priority? What would attract customers to the store? And so on. A smaller space also means greater storage and related inventory costs. Do they have an accurate and timely inventory information system to track which inventories need to be restocked? Also, most of the outdoor and sports products that Canadian Tire sells are seasonal; again, inventory management is vital.
Furthermore, the lease rates at the locations they
References: Strauss, MARINA. "The Globe and Mail." The Globe and Mail. N.p., 07 Mar. 2013. Web. 19 Mar. 2013. http://www.theglobeandmail.com/globe-investor/goodbye-big-box-canadian-tire-thinks-small-to-take-on-giant-target/article9382548/ News, CBC. "Canadian Tire to Buy Forzani Group." CBCnews. CBC/Radio Canada, 09 May 2011. Web. 18 Mar. 2013. http://www.cbc.ca/news/business/story/2011/05/09/canadian-tire-forzani-group.html -------------------------------------------- [ 1 ]. http://careers.canadiantire.ca/english/about/way.html [ 2 ]. http://careers.canadiantire.ca/english/about/way.html