[afransen]

Odd that that article claims that few retailers have expansion plans. Most that I hear about are opening new stores at a moderate pace this year.

 

[Skeezix]

Canadian Tire tries selling groceries

Unlikely player in grocery business will have food aisles in four stores by spring in bid to wring out extra sales and profits

Mar 05, 2009 04:30 AM

Dana Flavelle
Business reporter

Next time you pick up some Goodyears and 10W-30 at Canadian Tire, stop by the food section for a carton of milk, a box of frozen burgers and a package of cookies.

As consumers clamp down on discretionary spending, retailers are increasingly adding more necessities, shifting to cheaper goods and opening smaller stores, investors heard at a CIBC World Markets conference in Toronto yesterday.

Canadian Tire is an unlikely player in the grocery business, though it already offers pet food and laundry detergent alongside the fishing rods and lawn mowers.

But it said that in the two stores where it's experimenting with additional fresh and frozen food, customers are putting more groceries in their baskets than expected. Now, Canadian Tire plans to add food in two more stores, in Hamilton and Sarnia, this spring.

"It's a very small experiment. It's 2 per cent (of selling space) in one store and less than 2 per cent in the other store," said Stephen Wetmore, president and CEO of Canadian Tire. "I don't think Loblaw has anything to worry about."

The test stores are in Welland and the Ottawa suburb of Orleans.

Food is just one of the new categories Canadian Tire is testing as it tries to wring more sales and profit out of some of its larger stores, said Perry Caicco, an analyst with CIBC World Markets.

The food is "very competitively priced, as if they're a discount chain," Caicco said in an interview. "They're not talking about whether they're making any money on it.

"At those prices, it would be difficult to do."

But it attracts a lot of attention, he said. The retailer is also testing ready-to-assemble furniture and a bigger investment in hockey equipment, Caicco noted.

Other dry-goods retailers, such as Shoppers Drug Mart, Wal-Mart and Zellers, have pushed hard into food retailing with good results. But it has become even more important as a sharp and rapid economic decline leads consumers to cut discretionary spending.

Food retailing is one of the biggest and most recession-proof retail segments. But it isn't easy predicting what thrifty consumers will buy as they trade up in some categories and down in others, a leading supermarket operator told the conference.

"It has become more important than ever before to have your finger on the pulse of changes in the household," said Bill McEwan, president and chief executive officer of Sobeys Inc., the country's second-largest food retailer.

As customers spend less time in restaurants, they're buying more supermarket tea and coffee, but at the same time buying less premium ice cream and are trading down from high-end pastrami to low-end ham, McEwan said.

"We're seeing profound changes in the way people shop."

Canadian retailers aren't facing the kind of consumer crisis described by U.S. retail guru Dan O'Connor, president of consulting firm RetailNetInc, who said a growing number of "distressed" customers are shopping only on payday, and only at discount stores.

But the worst may be far from over for Canadian retailers, cautioned Allan Leighton, president and deputy chair of Loblaw Cos. Ltd.

"What we don't know will hurt us," he warned. "There's still a lot we don't know."

Canadian Tire is one of the few general merchandise retailers that continues to succeed against Goliaths such as Wal-Mart though even Wetmore, who's new to the firm, is at a bit of a loss to explain why.

"How did we get to where we are today? I don't know if we know," he told the conference, adding it may be the retailer's unique combination of automotive, leisure and household goods.

However, like other retailers, Wetmore said he can't afford to be complacent amid a downturn that has hurt consumer confidence.

"Every day you worry about what's going to happen next week," he said. In response to declining consumer spending, he said Canadian Tire is shifting its mix of products to include more lower-priced merchandise. A falling loonie means it can negotiate better prices from offshore suppliers, he added.

 

[afransen]

Canadian Tire tries selling groceries

A falling loonie means it can negotiate better prices from offshore suppliers, he added.

Remind me not to buy any CT stock if that quote is accurate. A falling loonie hurts our purchasing power abroad.

 

[Peepers]

Remind me not to buy any CT stock if that quote is accurate. A falling loonie hurts our purchasing power abroad.

IF that quote is accurate then CT needs to start looking for a new CEO. IF this quote is accurate CT cannot afford to have someone that STUPID at the helm.

 

[Observer Walt]

The "Q Store" and gas bar, operated by Canadian Tire at Eglinton and Dixie, seems to have been rebranded as "Canadian Tire Gas +". The big "Q" has disappeared and been replaced by the familiar downward-pointing red triangle. I had wondered why they seemed to be going almost out of their way to play down the recognized Canadian Tire brand.

I wonder if any more of these outlets will open. They introduced this concept a couple of years ago with some fanfare, but don't seem to have done anything with it since then.

 

[Skeezix]

Since this thread appears to be more of a general CT thread (rather than one devoted to the Bay/Dundas store), perhaps an admin could change the title?

Roseman hits the nail on the head.

Roseman: Canadian Tire service needs a shake-up
May 25, 2011
By Ellen Roseman

Retail service is a lost art at Canadian Tire. You can get great deals if you hunt down the merchandise, figure out the price and do your own scanning at the checkout counter.

A recent experience made me wonder why this Canadian-owned chain can't step up its game and try to help customers, not ignore them. I needed an iron that turned off automatically when the heat was too high. At my local store on Sunday, I found two models that fit the bill, a Sunbeam and T-Fall, both selling at $49.99. However, the cashier rang in the Sunbeam at $59.99. I said I'd take the T-Fal instead, but she rang it in at $69.99. Turns out the shelf prices were wrong.

She called for help. No one came. Finally, a staff member arrived. He spent 10 to 15 minutes doing a search before telling me that the $49.95 irons were not in stock.

After buying the $59.95 iron and a $50 vacuum, my bill (before tax) was $110. I paid with my debit card and received just 50 cents in Canadian Tire money. When did this currency become so devalued? Once, it represented 5 per cent of your bill. Now it's 0.4 per cent.

Contrast that to The Bay, which used to be as bad as Canadian Tire when you needed service. Today, it's owned by Americans, who must have learned something from Wal-Mart. You find greeters on each floor, cheerfully showing you where to find what you need.

My husband and I shopped for a single-cup coffee machine at the Bay, where the assistant manager of housewares showed us the Keurig, Tassimo and Nespresso models. He was helpful, informed and opinionated. He gave us his card and offered to help us further by phone

I've been thinking about service after reading Malled: My Unintentional Career in Retail, by Caitlin Kelly. At 50 years old, she went to work part-time at a U.S. store called The North Face. She earned $9 an hour, compared to the $150 hourly rate she used to charge as a freelance writer and editor. But she needed the money as the recession hit home.

The lack of respect she felt from customers and her employer drove her crazy. One day, she had a meltdown in the stockroom and purposely destroyed the pole she'd been using to pull down an item stored too high to retrieve.

Kelly asks a lot of questions. Why are retailers so reliant on service, but so reluctant to pay for it? Why don't they ask employees how to improve things?Why do they treat staff as disposable?

Stores that proudly provide do-it-yourself service -- with no attempt to help the confused - don't deserve our continued patronage.Customers should stop going to retailers that stint on staff.

We have the power to change things, so let's use it.

 

[airplane-dude]

An interesting article and I think that explains what happened to Zellers. People no longer like Zellers and only shop there if there's no other choice.. or if they have a 'Midnight Madness' sale.

I don't think Canadian Tire is that bad everywhere as I had a great experience with one of their automotive sales managers a couple of years back. They went the extra mile to get my type of tires instock to the store and install them in a timely manner.

 

[ShonTron]

I found service to be better at the Bay and Dundas store than my previous experiences. The staff don't hide (though they don't go out of their way to help). I also happened into a Canadian Tire at Lindsay last year and found that the refreshed store was great for selection, layout and customer service. Since CTC is largely franchised (though it adopted the model before franchising became popular) it is up to the local management.

 

[Tuscani01]

I found service to be better at the Bay and Dundas store than my previous experiences. The staff don't hide (though they don't go out of their way to help). I also happened into a Canadian Tire at Lindsay last year and found that the refreshed store was great for selection, layout and customer service. Since CTC is largely franchised (though it adopted the model before franchising became popular) it is up to the local management.

The owner of Bay/Dundas was removed from the store by corp. There should be quite a few changes on the way for that store in terms of management, all for the better I say!

 

[DTowner]

Good service is in the eye of the beholder. Personally, I HATE greeters at the door; they're annoying. Plus, it is very American. The whole greet you at the door malarkey started when GAP and other U.S. clothing companies started coming here in full-force in the late 80s. They just brought their brand culture with them and it spread. I find shop assistants who are too 'friendly' and too attentive intimidating and a reall put-off. Take the cologne department at Holt Renfrew: they need to tone it down and STEP BACK. If I want someone's help, I'll go up and ask someone.

 

[Skeezix]

Good service is in the eye of the beholder. Personally, I HATE greeters at the door; they're annoying. Plus, it is very American. The whole greet you at the door malarkey started when GAP and other U.S. clothing companies started coming here in full-force in the late 80s. They just brought their brand culture with them and it spread. I find shop assistants who are too 'friendly' and too attentive intimidating and a reall put-off. Take the cologne department at Holt Renfrew: they need to tone it down and STEP BACK. If I want someone's help, I'll go up and ask someone.

I hate greeters too.

 

[Tuscani01]

Our newest stragey in the media today. Smaller stores, focused on specific needs of each community they will be serving.

Downsizing the big box? CT's vision

Report on Business: Globe and Mail

March 7, 2013

Byline: Marina Strauss



Canadian Tire Corp. Ltd. is thinking big about getting small.

The iconic Canadian retailer, whose big-box stores are a fixture in suburbs and towns across the country, will test a vastly smaller version in urban malls this summer.

It's also set to pilot a separate chain of outdoor recreation stores - and other specialty chains eventually - taking on so-called category killers such as U.S.-based Bass Pro Shops and Cabela in stores that could be as little as one-10th their size.

"This is an opportunity for us to demonstrate our leadership position in these categories and look at markets that we believe are under-served," Marco Marrone, chief operating officer of Canadian Tire, said in an interview.

The initiative comes amid intensifying competition and the arrival this month of Target Corp. and its big-box outlets.

As the U.S. discounter moves into the crosshairs of Canadian Tire’s suburban stores, the domestic chain is racing to branch out into new territory - city centres - to shore up its business in smaller stores.

But it will feel the pressure to pump up sales in new mall stores to compensate for much higher urban rents than at its existing locations.

"It's quite a departure," said James Smerdon, vice-president of retail consulting at realtor Colliers in Vancouver.

"But in a mall you've got a focused group of shoppers walking right by your door. You can get the impulse shopper," Mr. Smerdon said.

An array of retailers, including discount giant Wal-Mart Stores Inc., are moving in the same direction, responding to time-pressed consumers who are seeking convenience and faster shopping - and often ready to spend more for the speedy experience. As well, big-box retailers are close to saturating their core suburban markets and now are following their shoppers, who are moving into dense city centres, where store space is at a premium.

Enclosed malls tend to attract more browsers, women and younger consumers, with stores that can generate twice as many sales per square foot than those in the open-air power centres where Canadian Tire and other big-box stores tend to operate, Mr. Smerdon said.

Canadian Tire already has found that its smaller stores are more productive: In 2009, sales per square foot were almost 17-per-cent lower in its more spacious outlets.

But the move to the urban mall will bring with it the challenge of having to be even more productive in a smaller space to make up for steeper rents. Enclosed malls command 50-to 60-per-cent higher overall lease rates than typical suburban power centres, estimated John Crombie, national retail director at real estate expert Cushman & Wakefield.

Canadian Tire’s downsizing and move to the core is just another example of the ongoing retailer's rush to capture more revenue in the under-serviced retail market in the urban area," Mr. Crombie said. " Urban retailers are now trying to capitalize on this growing trend."

In the past few years, Canadian Tire has rolled out some smaller stores of roughly 15,000 square feet in rural areas. Now its urban "express" stores will scale back more - taking up about 10,000 square feet - which is one-quarter the size of its conventional outlets.

"The idea of a smaller footprint makes sense," said Jim Danahy, chief executive officer at consultancy CustomerLAB. "The idea that there may be an alternative format to the Cabela and Bass Pro superstore model is quite interesting."

He said demand is growing for hunting and fishing products, which carry attractive profit margins. Already, Canadian Tire is benefiting from the heightened demand in its mainstream stores, enjoying some if its sharpest sales gains in those categories. In its fourth quarter, its hunting-gear sales jumped 25.4 per cent from a year earlier, while fishing gear sales picked up 9.4 per cent and camping merchandise 13.4 per cent, Marrone said. To spur the business, the retailer has set up mini-boutiques, called ProShops, within 50 of its 490 stores.

It also is considering standalone specialty chains for other areas of strength on which it is focusing in its big-box stores, including kitchenware and home goods, Mr. Marrone said. Its fourth-quarter sales of kitchen appliances grew 8 per cent and storage products were up 4.4 per cent, even though less than 20 per cent of its stores got the latest makeovers in those sections, he said.

At the retailer's diminutive new Canadian Tire "express" store, it plans to stock most categories that the chain is known for, but fewer items, he said.

 

[DavidJamesTO]

Sounds like a smart move. It's not always easy to find hardware stores within walking distance once a big box has moved in a few minutes' drive up the road.

 

[uptown]

How about building stores where you don't have to squeeze past customers in the checkout line to ask the cashier on duty to buzz the gate to let you get out of their firetrap of a store?

 

[ShonTron]

How about building stores where you don't have to squeeze past customers in the checkout line to ask the cashier on duty to buzz the gate to let you get out of their firetrap of a store?

The installation of the self-checkout lanes finally provided a barrier-free exit to CT stores, though the self-checkouts are annoying to use (swapping one annoyance for another).