In addition, the company was operating about gas stations. Besides increasing the number of stores in its portfolio during the s and early s, Canadian Tire had introduced a variety of new merchandise. The company had started selling a large amount of sporting and leisure items, as well as hardware, lawn and garden items, inexpensive furniture and other home products, and even luggage. In essence, Canadian Tire was becoming a general-merchandise discount store with an emphasis on automotive products.
Under Groussman's leadership, Canadian Tire continued to expand its store network and distribution facilities. Between and , in fact, Canadian Tire added about 75 gas stations and 17 retail stores to its group, pushing sales past the CAD 3 billion mark for the first time in Meanwhile, net earnings gradually rose to nearly CAD million annually in both and Canadian Tire was ranked as the 42nd most profitable company in Canada in and the company's workforce swelled to nearly 25, Encouraged by healthy gains at home, Canadian Tire management decided once again to take a crack at the massive U.
In the company announced its intent to enter the Indianapolis, Indiana, market with four new stores under the name Auto Source Inc. Those stores, which mimicked the successful Pep Boys centers, incorporated 14 service bays and about 18, square feet of space for inventory. In , it decided to change the names of those stores and began construction on two new stores. The design of the new outlets was influenced by the growing trend toward superstores.
Thus, the new Auto Source outlets boasted 30, feet of retail space and 24 service bays. Auto Source planned to open between and additional outlets in the United States by the close of the century, aiming for CAD 1 billion in sales by that time. During the early s Canadian Tire opened six more Auto Source outlets, for a total of ten, that were soon generating more than CAD 60 million in annual revenues. Like the company's first attempt in the U.
The venture lost CAD Company officials explained that the loss was not unexpected considering that it was a new enterprise. In , however, the division's losses increased. Part of the problem was that Auto Source was attempting a start-up in the midst of a U.
But losses, according to critics, also stemmed from the fact that the company's U. Furthermore, the auto parts industry was facing increasing competition from discount stores such as Wal-Mart Stores, Inc.
In fact, Canadian Tire's domestic operations were also suffering from increased competition, particularly from invading mega-discounters such as Wal-Mart and Kmart Corporation. Indeed, by the early s Canadian Tire was generating only about one-third of its revenues from automotive-related sales.
The other revenue was generated from general merchandise. Canadian Tire was Canada's largest hardware retailer, for example, and a leading supplier of sporting goods.
Profits from those items were increasingly being pinched by competition from discount warehouse rivals. Partly as a result of that dynamic, Canadian Tire's financial performance deteriorated in the early s. Although the company's revenues grew to CAD 3. Groussman left Canadian Tire in and was replaced by Stephen E. Bachand, previously an executive vice-president at Hechinger Company, a home center chain based in Landover, Maryland. Under Bachand's leadership, the company began implementing a strategy to help it compete in the new retail environment.
That meant eliminating certain inventory items such as furniture and luggage from some stores and focusing on the company's traditional core products: automotive accessories, hardware, and sporting goods. The big superstores that were popping up across Canada carried all of those items and often had larger selections. But Canadian Tire benefited from intense market penetration--about 80 percent of all Canadian citizens lived within 15 minutes of one of its outlets--and was also known for its high-quality products.
Importantly, Canadian Tire launched an aggressive renewal program that called for the enlargement of of its stores by Canadian Tire's net earnings plummeted to just CAD 5.
Early in , moreover, the company decided to shutter its Auto Source chain in the United States and completely bail out of that market.
All of the U. Despite this setback, early results from the company's store expansion program were positive and management expected to realize substantial gains as it enlarged existing stores. On April 3, , company founder Alfred Jackson Billes passed away at the age of His professional accomplishments included investiture in as a Member of the Order of Canada, the highest recognition a civilian Canadian could achieve.
Canadian Tire's store improvement program continued throughout the late s and into the new decade, by which time the cost of the program would top CAD 1 billion. While some existing stores were expanded to conform to a handful of new prototype layouts later reduced to three , in many cases brand-new stores were built as replacements.
By , when the number of completed outlets stood at , the program had been expanded: The firm now planned to convert of its stores to the new formats. As the company saw dividends from the more modern store designs and improvements in customer service, it also made changes in its management and ownership structure.
In the late s and early s relations between the Toronto headquarters and the Canadian Tire dealers had been strained--so strained that the dealers had tried to buy the company in from the three children of A. Billes who held a controlling interest. The brothers, Alfred and David, and the sister, Martha, had been locked in a battle for control of the company before agreeing to sell to the dealers.
But security regulators blocked the plan, contending that it was "abusive" to nonvoting shareholders. A truce was reached in that put an end to various lawsuits, but it was not until Bachand came onboard that relations with the dealers began to be mended. Bachand spent much of his first year meeting with and listening to the dealers, and he also started involving them in corporate strategy sessions.
In anticipation of the transition, Muncaster had been promoted to vice president in and formally took over as president in Muncaster launched three key initiatives. Gone were the days when a new dealer might acquire a Canadian Tire store with a simple handshake and an agreement to buy Canadian Tire products.
Second, Muncaster looked west, as Canadian Tire had no presence west of Ontario. By the end of , the company opened a store in Winnipeg. Finally, he brought in one of the first IBM computer systems in Canada to help streamline inventory management across the growing organization.
For the most part, the Muncaster-led expansion was successful. However, not everything went well during the s, when rates of both inflation and unemployment were high; by , the company reported its first ever year with no profit, and concerns about oversupply and overexpansion grew. During the s, the long-simmering disputes between the Billes family members erupted.
In , A. Rifts also began to emerge between the Billes family and Muncaster, namely over his expansion plans in Australia, A. The divided situation became more complicated when the various charitable organizations that held the trust shares that had been bequeathed by J. Imasco was encouraged by interest from Muncaster and the Canadian Tire management team but faced stiff resistance from A. J and his children. Following a highly unprofitable purchase of the Texas retail chain Whites, Muncaster was ousted as president in However, ownership uncertainty remained, as Martha, Fred and David Billes, who had a famously tumultuous relationship, continued to jockey for control of the company shares.
The dealers also sought to increase their power. If successful, the dealers would acquire a majority share of the firm. The bid caught the attention of the Ontario Securities Commission, which alleged that the deal did not consider the interest of shareholders with nonvoting shares, who would not benefit from the high price for voting shares.
After the OSC quashed the dealer bid, the siblings took their dispute to court. Finally, in October , an agreement was reached between the siblings and the dealers whereby no one party could make a sale that would threaten their majority hold without first informing the other parties and giving them first opportunity to bid.
Despite the widely reported ownership disputes, the company began to recover from its difficulties following the Whites acquisition. The company ran several successful advertisement campaigns, and in the firm reported profits. Canadian Tire has undertaken several initiatives in its effort to remain competitive, particularly with the expansion of US-based chains like Walmart and Home Depot and growing competition from online retail services.
The company homogenized the layout of Canadian Tire stores, using clearly delineated sections and providing information kiosks. Building on its experience with Canadian Tire money, the company expanded its financial services arm, launching the Canadian Tire Bank in The bank was meant primarily to market a credit card linked to Canadian Tire money.
To capture more of the youth market, Canadian Tire took over Forzani Group owner of Sport Chek and other athletic stores in In recent years, Canadian Tire has focused on its online store, recalling its catalogue roots that took it from Toronto to the entire country.
It has also continued to expand its product and brand offerings. It acquired Norway-based sportswear company Helly Hansen in Canadian Tire Corporation, Limited Canadian Tire Corporation, Limited is a network of interrelated businesses, engaged in retail, financial services, and petroleum. Search The Canadian Encyclopedia. While the new Wal-Mart and Home Depot superstores often offered more products and greater selection than Canadian Tire, the retailer had geographic proximity on its side: on its website it says that 80 per cent of all Canadian citizens live within a 15 minute drive of one of its outlets.
Buckman is on leave from his work as a doctor and is preoccupied with buying stuff at Canadian Tire. The page you are looking at will not be updated. The Story. Did You know? The upside of downsizing Canadian Tire Acceptance CEO Jos Wintermans proves that it's possible to take care of your employees while scaling back operations. Rob Buckman, Canadian Tire addict Dr.
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