Financial Service Division: Canadian Tire Corporation Limited - Research Paper Example

Financial Service Division: Canadian Tire Corporation Limited Background The Canadian Tire Corporation Limited (Ltd) is a retail organization that comprises of a family of companies. According to the 2013 Canadian annual report (2014), this corporation that consists of a family of companies has different segments namely; financial service division, a retail segment and a CT Real Estate Investment Trust (CT REIT) division. The corporation first started as a tire and garage store known as the Hamilton Tire and Garage Ltd in Toronto. This was in the year 1922, after two brothers John W. and Alfred J. Billes decided to use their savings to buy it. This cost them $1,800 (Canadian Tire, 2011). It was not until they opened their first associate store in the year 1934, that it later became the modern-day massive chain of Canadian Tire stores. Canadian Tire Corporation is a public limited company in the retail industry and headquartered in Toronto, Canada. It is estimated to have around 482 stores in Canada and more than 58, 000 employees in all the three different family segments of the corporation (Kearney and Ray, 2009). The president of this successful corporation is Michael B. Medline, the Chairman of the Board of directors is Maureen J. Sabla and the Chief Executive officer is Stephen G. Wetmore. Lastly, the Chief Financial Officer is Dean McCann (Year 2013 Annual Canadian report, 2014). History of the Organization The corporation’s mission is to remain as the Canadian family that it has been and focus on serving and ensuring that the lives of the corporation’s customers, shareholders and team members are enriched in different and impactful ways. The corporation’s vision is to continue growing and being an inventive eco-system type of business (Canadian Tire, 2011). The company sells a variety of products, ranging from home and leisure products to sports and automotive products. Some of sports products include bicycles, eco-friendly household items such as cleaners (National Round Table on the Environment and the Economy, 2012). Automotive products range from batteries to tires. The products also have a variety of brand names which are well-known by most Canadians such as Supercycle bicycles. Over the years, the company continued to successfully distribute their products and in 1972 celebrated its 50 years of service when it opened a tire store based in Saskatchewan in Western Canada. Even in the mid 2000s, the company still made progress particularly when it opened a Next Generation store which was supposed to provide customers with new products and services. As one of the most shopped retailer in Canada, the corporation also provides its clients with gasoline from one of its specialty chains called the Canadian Tire Petroleum. The corporation has around 300 retail gas sites in Canada. According to Kearney and Ray (2009), though most people today in Canada are used to the products that the stores sell, the corporation never tires from coming up with new products for its customers. In the year 2005, this leading retail company formed a partnership with other companies such as The National Association for Stock Car Auto Racing (NASCAR) which is in United States and a Canadian sports network known as The Sports Network (TSN). After the partnership, they came up with the three limited Canadian specialty of tire money coins. This is only one of the many concepts of promoting their store’s features. Market Share/ Competitive Position and Employee Mix a) Market Share In the last few years Canadian Tire Corporation has continued to maintain a stronger market share. The market share position allows it have a variety of products that have a strong market base, particularly the automotive, kitchen and hardware products. According to the 2013 Canadian Annual report (2014) Canadian Tire is known in Canada as one of the strongest within the Eastern and Central parts of Canada. In the Western side of Canada, the corporation may also have the opportunity to have a great market share. Table I showing the consumer spending techniques in the Canadian market from January 2012 to January 2015 Source: (Trading Economics, 2015) From the table above, it clear that the consumer habits of the Canadian consumer increases with each year. This shows that retail companies such as the Canadian Tire Stores that are all over the country need to continue coming up with new products to satisfy the increasing demand. b) Competitive Position The strongest competitors competing with the Canadian Tire stores include Target stores, Amazon and Wal-Mart stores. Nonetheless, the corporation’s competitive advantage is that it has a loyalty program which usually gives money, which is in form of coupons to its customers after they make a purchase. It was a program that first came into existence in the 1958, specifically designed to serve customers who would visit the store for many times. The corporation also collaboration contracts with some of its suppliers (Seifert, 2003). It resulted to the corporation becoming one that was more advantageous against its competitors. Moreover, because it is the first retailer to sell gasoline in Canada, it gains a more competitive edge over its competitors such as Target stores and Walmart stores. Table II showing Millions of Dollars that the Canadian Tire Stores make from year 2008 to 2012 Source: Year 2012 Annual Report on Canadian Tire (2013) (pg. 29) From the table above, it is evident that the more the stores the corporation opened, the higher the revenue obtained. For example, an increase in the number of the stores from 1,200 in year 2008 to 1,800 in year 2012 led to an increase of the stores’ revenue from $9,000 to $11,000 (Year 2012 Annual Report on Canadian Tire, 2013). c) Employee Mix According to 2013 Annual Canadian report by Canadian Tire (2014), Canadian Tire does not only have permanent employee, but it also hires part-time employees. From this report it is also evident that the corporation hires only qualified employees who specialize in marketing, supply chain, Information Technology, Finance and management among other qualifications. The employees also have a chance of getting trained because it offers internal training programs (pg. 15). Challenges Like other major retail stores, the Canadian Tire also has its challenges. For example, even though it provides products that make it more competitive than its competitors, the company is not well known on an international level. Canadian Tire has not expanded to other parts of the world where it is likely to have more clients. This is a challenge because it gives its competitors the chance to dominate the other parts of the world without stiff competition. It is also a problem because it limits the corporation’s sales. In addition, the market share for this corporation becomes limited only to the Canadian consumers. According to the Canadian Tire 2013 Annual report (2014), the Canadian population is also changing which has an impact on their consumption behavior. Immigrants in Canada may have different tastes and preferences for products provided at the stores. The changes in economic conditions, domestic and political environments are factors that are likely to impact on the corporation’s market. Analysis Canadian Tire Corporation continues as a successful retail company because there are always consumers who will flock at different stores to get good price deals for gasoline. It has also been one of the most shopped retail stores in Canada because of its marketing strategy. A look at all the stores in Canada shows that it has expanded to almost all parts of Canada. It is also estimated that most Canadians also live near most of the stores that are in most parts of the country. The stores do not necessarily provide automotive products, but now provides products that match the needs of the Average Canadian shopper. For those Canadians who live away from any of the Canadian Tire stores in the country, they have the advantage of making their purchases through an online shopping portal that was created by the corporation in year 2001 (Canadian Tire, 2011). Based on such characteristics, I chose to research on this organization because it has an exceptional marketing strategy. Unlike other corporations, it also serves the needs of Canadians and has always been the “go-to” store whenever I needed automotive parts or eco-friendly household items. In addition, the staff members are very friendly, which makes shopping fun and easier. When I graduate, this is one of the many organizations that I would want to work in, because of several reasons. There is a good team atmosphere and based on what I saw as a customer at one of their stores, employees who have any problems are easily helped by the management. The company is also a steady one and has been in existence for many years, which makes the opportunity for employee growth possible (Seifert, 2003). Based on the response I got from one of the employees, one learns to push through the challenges which might not be present in other stores such as Wal-Mart. The National Round Table on the Environment and the Economy (2012) also indicates that this is one of the best companies to work for due to its considerations for the environment with its eco-friendly products. Questions I would ask the HR Manager There are five main questions that I would ask the HR manager at the Canadian Tire Corporation if I got the chance. 1) What is required of every employee for them to remain so knowledgeable and friendly to customers at all times? 2) Do employees have job securities such as health insurance covers and allowances? 3) What type of candidates is the department looking for when hiring? 4) How is the company’s culture at all Canadian Tire Stores? 5) How are the employees motivated and how do they get to reach their professional targets? References Canadian Tire. (2011). All about Canadian tire. Retrieved from http://corp.canadiantire.ca/EN/Pages/default.aspx Kearney, M., & Ray, R. (2009). The big book of Canadian trivia. Toronto: Dundurn Press. National Round Table on the Environment and the Economy. (2012). Canada's opportunity: Adopting life cycle approaches for sustainable development. Ontario: National Round Table. Seifert, D. (2003). Collaborative planning, forecasting, and replenishment: How to create a supply chain advantage. New York: AMACOM Div American Mgmt Assn. Trading Economics. (2015).Consumer Spending. Retrieved from http://tradingeconomics.com/canada/consumer-spending Year 2012 Annual Canadian Report. (2013). Canadian tire corporation, limited 2012 annual information form. Annual information form, 1-34. Year 2013 Annual Canadian Report. (2014). Canadian tire corporation, limited 2013 annual information form. Annual information form, 1-34. Read More