Canadian Tire is a Canadian retail institution that really has no equivalent south of the border - a big box store that’s a little bit Pep Boys, a little bit Home Depot, a little bit Bed Bath and Beyond, a little bit Dick’s Sporting Goods, a little bit Gander Mountain.
Considering how there’s no shortage of US retail chains in Canada, and that Canadian restaurant chains have some operations south of the border – mainly in Buffalo – it seems like there are few barriers stopping Canadian Tire from entering the US retail market. Still, there’s none of them on American soil, and as far as I know there have never been any plans to follow the country’s comedians, television news reporters and hockey players into the States.
How come Canadian Tire never expanded into the United States? Patriotism? Studies showing that Americans won’t accept such a retail concept? Something else?
Based on the name of the company, the owners probably never intended to expand south of the border.
OTOH, it is possible that they do have a presence in the US under a different name. Not sure, because I haven’t researched it, but there are a lot of tire stores in the US. Some of them may possibly be affiliated with Canadian Tire.
What’s so special about tires? It seems to be a pretty basic commodity. Can CT offer better pricing/service/etc.? than USA competition? Otherwise, trying to enter the USA market is expensive and difficult. Also, entrenched competitors will not give up-expect fierce competition. Is the CT chain big enough to absorb losses (possibly for years)?
The USA market is large, probably 10-15 X the Canadian market-but entering is not easy!
I’m Canadian and I don’t understand how Canadian Tire stays in business in CANADA. There’s nothing they do that Walmart and Sears don’t, and their prices are generally more expensive. The few times I’ve been their for special sale items I noticed that:
Often the female sales clerks are younger and more attractive, this seems to be true for several locations here in town.
They give out “Canadian Tire Money”, which I guess is some kind of rebate type program where you get a small credit towards your next purchase. I’ve never figured out exactly how it works and I’ve never used any of the CT money I have.
In addition, I understand CT has a contract with the Registrar of Imported Vehicles across Canada to perform federalization certification on vehicles imported privately from other countries. They charge a modest fee for this fairly simple service.
Beyond that, I really don’t know why anyone goes there aside from location.
I said attractive, not scantily clad, there’s a difference. In any case I have interests in particular kinds of women which I understand don’t appeal to everyone.
Since this sort of piqued my interest I had a glance at their wiki. It seems they are a fairly diversified company, with gas stations, the Partsource chain of automotive parts stores, credit cards, etc. So they are like any other big box retailer, and I suppose most big box retailers generally do Ok these days, but I can’t think of any particular gimmick or killer feature that CT has.
I think their biggest advantage is that they have been around a long time, so people go there out of habit. The first Canadian Tire opened in 1922. Canadian Tire established themselves as a ‘big box’ retailer in Canada long before there was much competition in that type of store.
The ‘Canadian Tire money’ rebate program is dead-simple to understand and was around long before computerized store cards became practical.
Despite the name, “Canadian Tire” isn’t just a tire store; it’s a retail outlet that very much fits the description of the OP’s first paragraph.
I’m not really sure what the niche is – I suppose it’s the same demographic as those that shop at Aco Hardware at home in the 'States, where hardware is really a small portion of what they do. Going into Canadian Tire is like going into Super Aco if one were to exist.
In direct comparison shopping I have found them invariably cheaper than Sears and Home Depot, and in a remarkable number of cases they had tools and parts I could not find at Home Depot. Home Depot, especially in Canada, is amazingly expensive.
They’re not cheaper than Walmart, but in their areas of expertise, such as tools, outdoorsy stuff, car stuff, and sporting goods, their selection is ten times better.
As the OP notes, their market space is really unlike any other store. There’s no equivalent. The truth is they’re popular because they’re the ultimate man’s big box store; automotive parts and service, a terrific hardware and tools section, outdoors/camping stuff, and sporting goods. There’s nowhere else you can go to find a new shotgun, a set of drill bits, a camping stove, a pair of skates, new rims AND have your tires balanced while you shop.
How can you not figure out how it works? They give you little coupons with values printed on them like money. You can then use them as money at a Canadian Tire store. It’s the simplest coupon system in the history of commerce.
Just a suggestion:
most shoppers are women. Most big box stores want to appeal to women. There may be a good niche in marketing to men, (especially if they all wear checkered shirts, work as lumberjacks, and sing …) But to compete against Walmart and Target, I would think you should try to attract female customers, too.
(Now, I don’t have a dog in this fight–I’ve never even heard of Canadian Tire stores, and I sure don’t know anything about them. But why should that stop me from acting smart? )
I agree with RickJay. When I am in Canada I always make a point to go into a Canadian Tire store.
Think of a Wal-Mart with all of the junk clothing removed. Use that space for auto parts, hardware, housewares, sporting goods and other useful stuff. Their inventory and selection is tremendous. You’ve got a very good chance of finding the auto part you need and can still pick up some hardware, a dog collar and a quality hockey stick. While you do your shopping you can sip on a cup of Tim Horton’s coffee.
I’m guessing that they got established by being a one stop place in smaller communities the way that Wal Mart got started. The stores then grew in prominence and size as populations increased and there was more affluence. They are probably reluctant to try to compete in the US marketplace because the competition is already well established. It would be an uphill battle.
Thanks Dr. Rick, but I got that part already. What I could not figure out is
On what basis the rebate calculated. I looked on Wiki and it says the exchange rate changes every year, but I’ve never seen the percentage disclosed in store, maybe it’s in their annual report?
Why I only got it some of the time, I just looked on Wiki and found out that it is only on cash or debit purchases, but the other day I went to exchange something for store credit, and when I used the store credit, I got CT money on it even though the original purchase was on credit card. This is very confusing.
How exactly is it treated for the purpose of calculating sales tax? If I buy a shed with CT money, is the entire amount treated as a “discount”? Is there sales tax applied or is it considered a gift?
How do they even begin to deal with this for accounting purposes? Is that cost plus the capital cost of installing seperate cash register trays for CT money really worth it?
I’m still very much confused by the entire system.
Since I’ve returned to Canada, I’ve shopped at Canadian Tire for: garbage cans & bags, a TV switcher, nuts and bolts, car washing stuff, a broom, A/V cables, etc… I’ll be heading there later this week for Xmas lights, a fire extinguisher and fluorescent light bulbs.
Why? Because it’s not just a hardware store. I’d be tempted to turn chappachula’s suggestion on its head and say that it’s a hardware and household item store that was originally started by a man then taken over by women, with an aim towards providing all your typical family items in one stop. The item selection may not make much sense to non-Canadians, but it’s as sensible as Wal-Mart becoming a grocery store.
It is a time-honoured ritual for a father to take his son to Canadian Tire on a Saturday and just… browse. My father did it with me, and, if I ever have a son, I will do the same.
When you enter the store, the first thing you notice is the smell of rubber from tires. You may not see them–there is so much else in the store–but you will smell them.
You can explore the seasonal and sporting goods aisles, looking at the bicycles and/or hockey equipment. Before specialist bike shops became common, this was where families bought their bicycles, and it’s still a place to go for kids’ bikes. You can buy tents and air mattresses and wheelbarrows and crossbows and ammunition and rifles. You can buy swingsets and garden sheds and wheed-whackers and betteries and lawnmowers.
There’s the electrical aisle. There’s lighting. There are plumbing supplies and cleaning supplies and tools, tools, tools. There’s a section of home electronics–TVs and clock radios and boomboxes and such–but it’s all off-brands or the house brand and nobody takes it seriously. The kitchen appliances, however, are on the edge of respectability.
And then there’s the historic core of the store, the automotive supplies. Tires line the walls, up near the ceiling. There are lubricants and gaskets and more tools and accessories and floor mats and Turtle Wax. When I was a kid, I always looked through the catalogue at the Thrush mufflers and go-faster kits and third-party tachometers and snow tires.
Yes, they still publish the catalogue.
And everyone in Canada has a wad of Canadian Tire money in the junk drawer in the kitchen. I think it’s a cultuiral requirement.