Canadian Tire Corporation (SWOT analysis)
An analysis about strengths, weakness opportunities and threats
of
CANADIAN TIRE RETAIL CORPORATION
A RESEARCH REPORT
BY
Diana De La Parra
10 June 2010
Canadian Tire was founded in 1922 by two brothers, John W. and Alfred J. Billes. With a combined savings of $1,800, they bought the Hamilton Tire and Garage Ltd. at the corner of Gerrard and Hamilton Streets in Toronto. Five years later they changed the name to Canadian Tire “because it sounded big”. In 1934 the store in Hamilton became the first officially designated Canadian Tire Associate Store. After this, Canadian Tire opened stores across Canada in almost every province.
Canadian Tire Corporation Limited is a growing network of associate businesses offering a range of products and services with more than 1180 general merchandise, Including general merchandise, clothing, gas stations, as well as major financial services provider and federally chartered bank.
Canadian Tire Retail, with 475 stores from coast-to-coast, offers customers a large section of national and retail brands through three specialty categories, automobile parts, accessories and service, sports and leisure products, and home products.
Canadian Tire Financial Services manages over five million Canadian Tire MasterCard accounts and markets related financial products and services for retail and petroleum customers. Canadian Tire Petroleum operates 273 gas bars, 267 convenience stores and kiosks and 73 car washes.
This report is an analysis about the strengths, weaknesses, opportunities and threats of Canadian Tire Corporation Limited.
Canadian Tire Corporation has many strengths as an organization. First and foremost, they enjoy a strong and loyal customer base. Their long history as a Canadian company has helped them in this regard, as many of the existing Canadian competitors have been purchased by foreign corporations over the years. They also have one of the most recognizable trademarks in the country. Another strength of the company is its diversity. They currently provide a wide range of goods and services to their customers – including automobile parts and service, financial services, clothing, hardware, and houseware. They also have one of the longest-running customer rebate programs of any retailer – that is, the Canadian Tire money that customers receive after making their purchases.
The major weakness of Canadian Tire is that in the past, they have periodically lost their focus on customer service. They have taken their customers for granted, assuming that the customer would always return to the store regardless of how they were treated. Because of this, they have occasionally lost market share. The company has also failed to recognize the changing demographic of Canada (immigration, different cultures). The stores tend to focus on their historical customer – the adult white male. They have failed to widen their focus to women and different nationalities such as Chinese and Indian customers. Another weakness of the company is its failure to expand successfully beyond Canada. This has put limits on the company’s growth.
Canadian Tire has a unique opportunity to capitalize on their status as a home-grown Canadian retailer. In the past several years, most other Canadian retailers have been purchased by foreign organizations. Therefore, Canadian Tire can continue to use national pride as a focus of their advertising campaigns to remind Canadians to support a Canadian company. This advantage is unavailable to most of the competition.
The major threat to Canadian Tire, or any retail operation, is competition. Canadian Tire has many strong competitors in its various areas of service, including Home Depot (hardware), Midas and Speedy (auto service), specialty houseware stores, and department stores such as Sears and The Bay. Many of these competitors can focus on their area of expertise while Canadian Tire must spread their focus to all of their areas. Another threat for the company is that they might lose their focus on customer service (as they have in the past) and this can cause their customers to go to their many competitors.
SWOT ANALYSIS
Strengths:
• Has a very strong and loyal clientele.
• Offer a range of goods and services that meet life’s everyday needs, including general merchandise such as clothing, petroleum and financial services.
• Offers a chain of automobile parts and professional automotive installers.
• Offers shopping on line.
• Canadian Tire bank provides greater marketing flexibility for using its credit card.
Weakness:
• Prices have gone up.
• They have lost their focus on customer service.
• failed to recognize the changing demographic of Canada (immigration, different cultures)
• failure to expand successfully beyond Canada.
Opportunities:
• Canadian Tire has a unique opportunity to capitalize on their status as a home-grown Canadian retailer.
• The opportunities to diversify the company opening other stores across Canada buying franchise in retails store or petroleum agency.
Threats:
• Home Depot is a threat for Canadian Tire because they offer almost the same range of items with quality and excellent customer service.
• Some customers complain about the bad quality of some items. This could be a threat because customers don’t trust TV as much as word of mouth, if customers are not happy they could be a bad campaign for them.
Canadian Tire Corporation is a Canadian success story in retail. They have successfully built a diverse retail giant that has survived the very competitive retail environment that exists today. Despite some customer service issues in the past, the company has been able to capitalize on their Canadian roots to build a strong and loyal clientele. The company needs to continue to build their expertise in their different retail areas in order to maintain their client base and to remain competitive in today’s retail environment.
of
CANADIAN TIRE RETAIL CORPORATION
A RESEARCH REPORT
BY
Diana De La Parra
10 June 2010
Canadian Tire was founded in 1922 by two brothers, John W. and Alfred J. Billes. With a combined savings of $1,800, they bought the Hamilton Tire and Garage Ltd. at the corner of Gerrard and Hamilton Streets in Toronto. Five years later they changed the name to Canadian Tire “because it sounded big”. In 1934 the store in Hamilton became the first officially designated Canadian Tire Associate Store. After this, Canadian Tire opened stores across Canada in almost every province.
Canadian Tire Corporation Limited is a growing network of associate businesses offering a range of products and services with more than 1180 general merchandise, Including general merchandise, clothing, gas stations, as well as major financial services provider and federally chartered bank.
Canadian Tire Retail, with 475 stores from coast-to-coast, offers customers a large section of national and retail brands through three specialty categories, automobile parts, accessories and service, sports and leisure products, and home products.
Canadian Tire Financial Services manages over five million Canadian Tire MasterCard accounts and markets related financial products and services for retail and petroleum customers. Canadian Tire Petroleum operates 273 gas bars, 267 convenience stores and kiosks and 73 car washes.
This report is an analysis about the strengths, weaknesses, opportunities and threats of Canadian Tire Corporation Limited.
Canadian Tire Corporation has many strengths as an organization. First and foremost, they enjoy a strong and loyal customer base. Their long history as a Canadian company has helped them in this regard, as many of the existing Canadian competitors have been purchased by foreign corporations over the years. They also have one of the most recognizable trademarks in the country. Another strength of the company is its diversity. They currently provide a wide range of goods and services to their customers – including automobile parts and service, financial services, clothing, hardware, and houseware. They also have one of the longest-running customer rebate programs of any retailer – that is, the Canadian Tire money that customers receive after making their purchases.
The major weakness of Canadian Tire is that in the past, they have periodically lost their focus on customer service. They have taken their customers for granted, assuming that the customer would always return to the store regardless of how they were treated. Because of this, they have occasionally lost market share. The company has also failed to recognize the changing demographic of Canada (immigration, different cultures). The stores tend to focus on their historical customer – the adult white male. They have failed to widen their focus to women and different nationalities such as Chinese and Indian customers. Another weakness of the company is its failure to expand successfully beyond Canada. This has put limits on the company’s growth.
Canadian Tire has a unique opportunity to capitalize on their status as a home-grown Canadian retailer. In the past several years, most other Canadian retailers have been purchased by foreign organizations. Therefore, Canadian Tire can continue to use national pride as a focus of their advertising campaigns to remind Canadians to support a Canadian company. This advantage is unavailable to most of the competition.
The major threat to Canadian Tire, or any retail operation, is competition. Canadian Tire has many strong competitors in its various areas of service, including Home Depot (hardware), Midas and Speedy (auto service), specialty houseware stores, and department stores such as Sears and The Bay. Many of these competitors can focus on their area of expertise while Canadian Tire must spread their focus to all of their areas. Another threat for the company is that they might lose their focus on customer service (as they have in the past) and this can cause their customers to go to their many competitors.
SWOT ANALYSIS
Strengths:
• Has a very strong and loyal clientele.
• Offer a range of goods and services that meet life’s everyday needs, including general merchandise such as clothing, petroleum and financial services.
• Offers a chain of automobile parts and professional automotive installers.
• Offers shopping on line.
• Canadian Tire bank provides greater marketing flexibility for using its credit card.
Weakness:
• Prices have gone up.
• They have lost their focus on customer service.
• failed to recognize the changing demographic of Canada (immigration, different cultures)
• failure to expand successfully beyond Canada.
Opportunities:
• Canadian Tire has a unique opportunity to capitalize on their status as a home-grown Canadian retailer.
• The opportunities to diversify the company opening other stores across Canada buying franchise in retails store or petroleum agency.
Threats:
• Home Depot is a threat for Canadian Tire because they offer almost the same range of items with quality and excellent customer service.
• Some customers complain about the bad quality of some items. This could be a threat because customers don’t trust TV as much as word of mouth, if customers are not happy they could be a bad campaign for them.
Canadian Tire Corporation is a Canadian success story in retail. They have successfully built a diverse retail giant that has survived the very competitive retail environment that exists today. Despite some customer service issues in the past, the company has been able to capitalize on their Canadian roots to build a strong and loyal clientele. The company needs to continue to build their expertise in their different retail areas in order to maintain their client base and to remain competitive in today’s retail environment.
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