BUSA 2100 – Management Project
Canadian Tire
and
Home Depot
by:
Brian Fong
Cindy Wang
Emily Xu
Mohammed Moiz
Nazanin Salehi
Neda Sedighi
Team Inferno
FMGT - Set 2N
March 2nd,2006
David Meers
Table of Contents
Report
Introduction and Background _____________________________________________ 3
Organizations’ Vision, Mission and Goals ___________________________________ 4
Organizational culture ___________________________________________________ 6
The Environment _______________________________________________________ 7
Social Responsibility and ethics __________________________________________ 10
Strategic Planning _____________________________________________________ 11
Organizational Structure and Design ______________________________________ 13
Appendices
Introduction and Background – Appendix A ________________________________ 15
Organizational Culture – Appendix B______________________________________ 16
The Environment – Appendix C __________________________________________ 17
Social Responsibility and ethics – Appendix D _______________________________ 21
Strategic Planning – Appendix E _________________________________________ 22
Organizational Structure and Design – Appendix F __________________________ 23
SWOT ANALYSIS – Appendix G _________________________________________ 25
Resources – Appendix H ________________________________________________ 29
Introduction and Background
Canadian Tire is a primarily a retailer which offers customers a large selection of national
and retail brands through three 'stores' under one roof - automotive parts, accessories and
service; sports and leisure products; and home products. They also are involved in
financial services (Canadian Tire Financial) and are the country's largest independent
retailer of gasoline (Canadian Tire petroleum) with more than 250 gas bars and 55
Simoniz car washes in Canada. Canadian Tire employs over 48,000 people.
Canadian Tire has been in business since opening its first store on September 15, 1922.
It was founded by 2 brothers – J.W. Billes and A.J. Billes. The company today has been
kept within the family. Martha Billes, the current head of the company, is considered one
of Canada's most powerful business women. She provides a role in where the company is
heading in the future and is always on the lookout for places to obtain oil and areas to
expand their retailing into. The CEO is a man named Wayne Sales, who regulates day to
day business. Canadian Tire has an executive committee composed of 14 members.
Please refer to Appendix A for more details about Canadian Tire.
Home Depot is a big box home improvement retailer that aims for do-it-yourself home
improvement and construction. They have over 2000 stores across North America and
employ over 325,000 people.
The company was founded in 1979 in Atlanta, Georgia by Bernie Marcus and co-founder
Arthur Blank. Marcus was CEO of Home Depot and Blank was Chairman of the board
until 2000, when Robert Nardelli took over the position of CEO in December 2000. He is
their current CEO. Both Marcus and Blank co-chair the board of directors.
Please refer to Appendix A for more details about Home Depot.
Organizations’ Vision, Mission and Goals
Canadian Tire
Canadian Tire’s purpose and vision are to be a proud Canadian family of retail, retailrelated and financial services business; be inter-related and strengthened by the triangle (a
great Canadian Brand); and exist to create “Customers for Life” and “Shareholder Value”.
This purpose and vision is very specific and clear for the development of Canadian Tire.
This purpose and vision help its management run the business and to sustain development.
Canadian Tire’s glorious history is full of customer-focused activities and records. In
their values, they announced that they respond to customer demand. In reality, they do
what they say. When there was a customer demand for heating garages in the 1920s,
Canadian Tire rented their heating garages to customers.
When car users preferred to repair their car rather than buy new ones during the Great
Depression, Canadian Tire introduced their “super-lastic” tire guarantee, which was the
first time in Canada that a tire was guaranteed for other than manufacturer’s defects.
Home Depot
In Home Depot’s mission statement, they speak about their purpose: to help people
improve the places where they live and work. With their purpose being clear and simple,
they also mention that their business is large, complex and growing.
Compared to Canadian Tire’s customer-oriented management, Home Depot focuses more
on its customers. On Home Depot’s official website, it is very clearly written out that
their key to success is treating people well. Management takes care of their people. When
you step into Home Depot’s retailing warehouse, you can meet more sales people than in
other retailing places. These people provide valuable suggestions and help. Apparently,
Home Depot’s management depend on their people’s dedication and commitment to
explore their expanding markets since 1978.
Rather than customer-oriented, they are relationship-oriented. With a good relationship
with associates, their own people, and with the communities where their stores are in,
they are paying attention to build up good relationships as well as good reputations with
the whole society. This orientation helps management to have a more broad vision to
their developing opportunities.
Comparison
Although Canadian Tire and Home Depot have some differences, their mission statement,
vision and values both mention the customer’s satisfaction, shareholder’s value, respect,
open communication, integrity, team and community, accountability and innovation.
These modern concepts bring the two companies from scratch to retail giants, from local
stores to huge, national & global retailing groups. Customers would like both companies
to maintain their overall good quality of business and low prices on national and namebranded goods. Stakeholders expect to see increasing profits and more dividends.
Organizational culture
Home Depot
Canadian Tire and Home Depot both say that they are focused on both internal matters
especially employees as well as their customers’ and its related profit and output.
In practice, however, Canadian Tire has paid more attention to internalities such as being
more moral and open to suggestions which make Canadian Tire’s culture more or less a
Clan model. Home Depot is very much concerned about output, market, productivity, and
profit that make its culture more of a Market model. For instance, Canadian Tire and
Home Depot both have staff meetings to “hear suggestions and increase the cohesiveness
of employees”. In Canadian Tire these meetings are very informal, management is very
open and flexible and employees can say anything they want. But, during the Home
Depot meetings, it is the management who does the most talking trying to motivate their
“associates” to sell more.
Culture is very important in the company’s success and overall we think Canadian Tire is
more successful in this case because its culture has provided a friendly and relaxing
environment for management by making their staff feel relax and cared for. Home
Depot’s environment is a little bit tensed in the management side as a result of every one
trying to increase profit. They treat their customers well though, but there have been a
few instances where customer service has wavered, which has cause Home Depot to lose
some customers to other retailers.
(refer to Appendix B for a CVF diagram)
The Environment
PEST ANALYSIS
Political factors
Comparing both companies, Canadian Tire has more to worry about due to the surging
oil and natural gas prices in Canada. Canadian Tire has a motto of keeping its prices low
for the everyday consumer, and with rising gasoline and oil prices they may need to
increase their prices to retain profit at their petroleum bars. Home Depot doesn’t really
need to worry about gas prices as they don’t have a gas bar and don’t plan on creating
one. Home Depot plans on expanding to other countries such as Asia and Europe, so
they will need to consider the political factors of those nations to be successful.
Economic factors
The Canadian economy is strong. Since 1994, Canada's economic performance has been
characterized by growth, low inflation, stable unit labor costs, improved cost
competitiveness, record exports, and a healthy level of business investment. In general,
Canadian Tire and Home Depot are making profits on their homeware sales.
However, there are some factors that affect these two companies differently.
1. Exchange rate
2. Oil price
Social factors
Safety:
Both companies have written safety policies and procedures, but Home
Depot provides training for all of its current and new employees and they
have a more comprehensive safety program compared to Canadian Tire.
Public Opinion:
It is difficult to compare Canadian Tire to Home Depot in this field
because Home Depot is the larger corporation that has more locations in
other places than just in Canada. Generally, there is more resistance met
with Home Depot expanding into smaller communities since they plan on
opening a lot more stores than Canadian Tire.
Corporate Social Responsibility:
Both companies have set up charitable organizations within their
corporations that basically have the same goals of helping people who
have financial difficulty. Canadian Tire is more people and activity
oriented, while Home Depot is more people and environment oriented.
Technological factors
Home Depot Technological improvements
Since 2006 Home depot has been invested 500,000 million alone on updating technology.
Today’s customers value speed and convenience, by improving the signage and also
installed 800 self-checkout counters, which 33 percent of customers use, cutting queue
time by 40 percent. The investment in 90,000 wireless bar code readers makes it easier
for customers with bulkier items to check out
Canadian Tire Technological improvements
In 1996, Canadian Tire turned to technology as a building block of its supply chain. As a
result, they implemented new operations and transportation-planning processes supported
by the vendor's transportation-management technology. Canadian Tire also built a robust
data-warehousing solution around the technology.
Canadian Tire is currently working with Fujitsu to supply Point of Sales (PoS) terminals,
with Windows XP software. They also plan to have PRIMERGY servers to meet
business-critical computing needs at each store location This system has the cumulative
effect of reducing maintenance costs over the lifecycle of technology systems and can
have a tremendous impact on the business performance by helping keep costs down and
prices competitive for customers.
Comparison: Both companies’ are improving the way they process sales, and in the
future we can expect to see more self-serve, wireless terminals that could
help reduce line ups and overall provide more efficiency.
(refer to Appendix C for more information)
Social Responsibility and ethics
Both of the Home Depot and Canadian Tire pay a lot of attention to the
environment, health, safe and social responsible operation. They build a lot of policies to
ensure their direction and action. Both of them have the Foundation Company to
cooperate with non-profit organizations to contribute to people, families, communities,
and society. They donate money to the disaster regions around the world, and help
people with building their homes after suffering from disaster.
Difference:
Home Depot insists on doing the right thing instead of just doing things right. It believes
that establishing the right goals is the most important issue. It strives to understand the
impact of our decisions, and it accepts responsibility for its actions. Refer to the appendix
for information about The Home Depot Foundation.
Canadian Tire applies its social responsibility within its daily operation management. It
strives to address environmental issues in all aspects of its operations. For example, its
operations include environmental programs that cover such issues as Storage Tank
Management, Energy Efficiency, and Waste Reduction and Diversion. Customers can
check material safety data on its website. Its 'Buy a Tree - Help a Family' Program and
‘Buy a Helmet - Help a Family' Program motive people to protect our environment.
Canadian Tire is good at promoting its brand and products through the social issues and
hot spots. Refer to Appendix D for an example.
Strategic Planning
Strategy of Home Depot:
Home Depot competes on price and serves the broad spectrum of the home improvement
industry. Over the next five years, Home Depot expects to maintain and grow its
leadership position in home improvement retail worldwide, become the nation's largest
diversified wholesale distributor, and become number one in services and also try to
dramatically increase direct-to-consumer channels.
New initiatives in 2006 include:

The launch of the broadest, most commanding tractor selection under one roof

Continued proprietary and exclusive brand leadership

New product resets, including a new Countertop Solutions Center and new tool and
millwork corrals

Expansion of the home organization and storage category

Increased lighting assortment in stores

Four convenience store openings in the first half of 2006, with the possibility of 300
by 2010.
Strategy of Canadian Tire:
Canadian Tire's Strategic Plan focuses on five strategic imperatives across all lines of
business, to:

Grow sales and revenues

Improve earnings performance

Embed a "Customers for Life" culture

Extend growth and performance beyond 2009

Enhance value creation through financial flexibility and maximization of real
estate assets
Comparison:
Home Depot
Canadian Tire

Focuses on expanding the business by
opening more outlets and convenience
stores by the end of 2010. 4 by 2006 and
300 by 2010.

Focuses on building strong customer
relationships with the customers and
focuses on ways to lower costs and give
higher returns to the share holders.

Plans on opening stores world wide

No plans to go global

Will expand the stores and bring in new
products which will result in increase in
prices

Promises to maintain the profit margin.


The launch of the broadest, most
commanding tractor selection under one
roof

Promises to make the products that are
required by its potential customers.
Enhance value creation through financial
flexibility and maximization of real estate
assets

Continued proprietary and exclusive brand
leadership
(refer to Appendix E for more information)
(refer to Appendix G for the SWOT analysis)
Organizational Structure and Design
Home Depot and Canadian Tire are both successful retailing companies. Home Depot is
constructed internationally (USA/Mexico/China) while Canadian Tire is constructed
nationally (Canada).
According to geographic situations, products and services lines, Home Depot constructs
its organizational structure in its 1818 Home Depot stores, 54 Expo Design Centre stores,
5 home depot supply stores, 11 home depot landscape supply stores, and other stores or
organizations under The Home Depot brand. The management of each branch or store is
responsible to their upper level directors, and all of them are subjected to an inspection
from the Board of the company, as well as stockholders and customers. As a public
company, Home Depot publishes its annual financial reports and speaks about important
decisions to its shareholders, employees and the whole society.
Although no Canadian Tire is exactly the same, the typical set-up for Management
personnel usually consists of a General Manager, Store Managers, Logistics Manager and
Department Manager. See the appendix for more details.
Differences:
As corporations, Home Depot, as a US based company, applies a one share-one vote
policy, Canadian Tire, as many other Canadian long-history companies, has a duel-voting
structure. Under this structure, when people buy Canadian Tire’s common stocks from
the stock market, there are amount of stocks which are held by some special people
giving those people more control on decision-making and operation of the company. This
specific difference of Canadian Tire and Home Depot’s organization structure and design
imply there are more chances for Canadian Tire to make decisions by small group people
who more concern their own benefits.
Same as Home Depot, there are marketing, financial, human resource and other businessrelated departments in Canadian Tire. These departments, as well as the dealers and
associates help the company functions well in a very huge structure under Canadian
Tire’s triangle brand. This structure and design are consistent with Canadian Tire’s vision
and conduct code. Under Customer and quality orientation, Canadian Tire demonstrates
its incredible potential in retailing industry. With a slogan “There are always
opportunities to fulfill your ambitions”, Canadian Tire puts it a special emphasis on
recruiting its work force and fostering its own people. With sufficient human resources
and abundant products lines, Canadian Tire has more opportunities to survive than it did
when it started in 1922.
(refer to Appendix F for more information)
Introduction and Background – Appendix A
Canadian Tire trades on the Toronto Stock exchange. Home Depot trades on the New
York Stock exchange. As seen by the 2 diagrams below, Home Depot’s stock is at $42.59
and Canadian Tire’s is at $64.40 as of March 2nd, 2006.
Both companies have executive management which basic job is to oversee the operations
of the company and increase shareholders’ value.
Home Depot
Canadian Tire
Organizational Culture – Appendix B
Using the Oticon worksheets in Lab,
we composed the CVF diagram for
Canadian Tire and Home Depot
by using our knowledge of both
corporations. These diagrams
are an accurate tally of our numbers.
Canadian Tire (above)
Home Depot (left)
The Environment – Appendix C
PEST ANALYSIS
Political factors
Canadian Tire is currently Canada’s only “government approved” retail store, which
meets all of the consumer needs of on-the-go male Canadians, who are too busy to
engage in time-wasting activities such as shopping.
Home Depot
Economic factors
Retail store sales by selected commodity have been increasing since 2000. This includes
automotive parts/accessories, automotive fuels, oils and additives, indoor furniture,
household appliances, home electronics, computers and cameras, home furnishings,
housewares, hardware and home renovation products, lawn and garden products,
equipment and plants and Sporting goods. In 2003, Home centers and hardware stores’
gross margin was 28.8%.
1. Exchange rate: The Home Depot currently imports products from
over 40 countries. Presently, Canadian dollar exchange rate
increases, Home Depot imports more than exports. On the other
hand, customers feel their money become more than before due to
the increasing exchange rate, they are more willing to go shopping.
2. Oil price: Since the Middle East political circumstance has been
unsteady for the past several years; countries of producing oil have
been reducing producing oil, which has caused the international oil
price dramatically increased. As the result, the prices of petrol
related products relatively increased. Canadian Tire Petroleum
still pumps over one billion liters of gas per year through a crosscountry network of gasoline outlets operating in prime locations on
or near its retail stores sites (over 400), which means you benefit
from the traffic and customer loyalty these stores generate
customers' needs and getting their purchases processed with the
greatest efficiency.
Social factors
Canadian Tire
 Safety
o Canadian Tire promotes protection of the environment and the health and
safety of its employees.
o Employees are required to follow the Company’s Environment, Health and
Safety Policy issued by their business unit.
o If an employee needs to travel, transportation services offered by a 3rd party
may be accepted provided that such services prove time and cost efficient or
protect the health and safety of the employee.
Home Depot
 Safety
o Home Depot believes in maintaining a safe working and shopping
environment is every associate’s responsibility.
o They have a comprehensive safety program which includes:
 safety standards
 customer communication
 associate training
 accountability
o Department safety awareness plans by topic
 attended by all associates the day the training is conducted
o Back Injury Prevention Training (BIPP) taken by new employees.
Canadian Tire
 Public Opinion
o After a slow start, launched it’s website in November 2000 and soon after
became No.6 e-tailing site in the country (according to Nielsen/NetRatings)
 Canadian Tire customers enjoy shopping online
o Attempting to bring in more female shoppers.
 Cambie Street, Vancouver location:
 Hardwood floors, widened aisles, brighter lights
 More touch and feel displays
 Female customers said it was more focused toward them,
especially for ones who had children
Home Depot
 Public Opinion
o Planning on launching a new website www.myhomedepotproject.com
 Website will be specifically tailored to improving customer experience
 Will assist customers with home installations and provide
additional services
o Certain locations have been met with resistance to having a home depot built
in their community, while some are embracing it.
 Agoura Hills, Mountain View, Reedley, Calexico, and East Palo Alto
 Cities in California that didn’t like the idea of having a home depot
around.
 Local home improvement businesses would go bankrupt if Home
Depot came into town.
Canadian Tire
 Corporate Social Responsibility
o Canadian Tire Foundation For Families
 Helps families by making sure that basic needs are met
 Food & shelter
 Have donated to various food banks and have helped others rebuild
their homes, particularly victims of the South East Asian Tsunami
disaster.
o Canadian Tire Jumpstart
 Helps kids in financial need participate in organized sports and
recreation
 Hockey, dance, soccer, swimming etc.
Home Depot
 Corporate Social Responsibility
o The Home Depot Foundation
 Supports organizations working to create/rehabilitate/finance home for
low to medium individuals and families.
 Promotes a healthy environment by supporting programs to restore and
sustain urban territory (parks, playgrounds) and wildland forests.
Technology
Home Depot Technological improvements
By changing the IT technology, they started retrofitting the insides of stores with new
point-of-sale systems, cordless scan guns, and self-checkout technology. This redesign,
with a price tag of a quarter-billion dollars, was the single largest IT capital investment in
the history of the company. In 2004, the company focused on back-end systems and on
building better partnerships with his 7,000 suppliers.
UCC net will improve the electronic-data sharing for product information. Today, the
processes are highly manual, and require faxes and forms. Many times, new products
arrive at a store from a manufacturer before they can even be set up on the system. It's
time-consuming and the tools are old. When the system was built, no one anticipated the
volumes and scale the company handles today.
New operational initiatives are free associates to spend more time serving customers.
New technology is driving productivity and customer service initiatives. The company
has redeployed approximately 100 hours onto the selling floor as a result of technology
enhancements, including self-checkout and new POS systems.
Canadian Tire Technological improvement
The new technology of Canadian Tire Retail and the Canadian Tire Dealers’ Association
has named Fujitsu Transaction Solutions Inc. Fujitsu will supply its Team PoS 2000 M
POS terminals, PRIMERGY TX150 servers and managed services, including staging,
integration, on-site/depot maintenance and call center support.
This system has the cumulative effect of reducing maintenance costs over the lifecycle of
technology systems and can have a tremendous impact on the business performance. It
helps keep costs down and prices competitive for customers.
Social Responsibility and ethics – Appendix D
The Home Depot Foundation defines an affordable home as one for which a person
making 80% or less of the area median income would spend 30% or less of their monthly
income on mortgage or rent payments. They believe that by helping families and
individuals secure dependable, quality, affordable housing, we are increasing their
chances of success in all areas of their lives. When the Home Depot are constructing new
houses, it conducts its employees to minimize the depletion of natural resources,
including timber and water; decreases the amount of construction waste going to landfills;
controls erosion and minimizes impact on natural areas; increases energy efficiency and
conserves water in construction and operations; reduces maintenance costs using
innovative and durable materials; improves indoor air quality; controls moisture and
provides proper ventilation; uses more environmentally friendly materials; and ensures
smart site planning and land use.
The Home Depot Foundation works with nonprofit partners to restore urban and rural
forests in order to create healthier natural areas and a better environment for our
communities. They incorporate a diverse array of trees to guard against disease and
infestations, utilize native trees when possible to take advantage of the region's climate
and conserve water, and engage community volunteers in the planting and maintenance
of their neighborhood trees.
Home Depot recognizes the value of providing timely and accurate information about the
social and environmental impacts of its business.
Canadian Tire
In 2005, a Canadian Tire in Halifax sponsored a TV show concerning homosexual
marriage, which was one part of their promotion strategy. When the local Canadian Tire
spokesperson was asked their opinion on homosexual marriage, she announced that they
would like to leave this issue to the lawmakers.
Strategic Planning – Appendix E
Home Depot
Mission Statement
The Home Depot is in the home improvement business and our goal is to provide the
highest level of service, the broadest selection of products and the most competitive
prices. We are a values-driven company and our eight core values include the following:








Excellent customer service
Taking care of our people
Giving back
Doing the "right" thing
Creating shareholder value
Respect for all people
Entrepreneurial spirit
Building strong relationships
Quotes:
“We will continue to drive productivity throughout our business in 2006,"
"By generating more than $8 billion annually in operating cash flow, we will continue to
invest in the business and return cash to our shareholders."
- Carol Tome, executive vice president and CFO.
“With more than 11,000 installations per day, The Home Depot is emerging as a major
force in the services arena, and we expect to continue our double-digit growth through
2010, becoming number one in that market,"
"Our goal is to provide customers with one-stop shopping, affordable pricing and
guaranteed results."
- Frank Blake, executive vice president of business development
Canadian Tire:
Mission Statement
We are a Proud Canadian Family…
We exist to serve and enrich the lives of our customers, our
shareholders, our team and our community.
Vision Statement
We are a growing, innovative network of interrelated businesses,
achieving extraordinary results through extraordinary people…
We touch the lives of more people in more ways every day.
Organizational Structure and Design – Appendix F
Home Depot
Home Depot strives to be the employer, retailer, investment, and neighbor of choice in
the home improvement industry. Corporate governance is part of its culture and is
founded on their daily commitment to living values and principles that recognize its
ethical obligations to their shareholders, associates (employees), customers, suppliers,
and the communities.
Home Depot strives to be the employer, retailer, investment, and neighbor of choice in
the home improvement industry. Corporate governance is part of its culture and is
founded on their daily commitment to living values and principles that recognize its
ethical obligations to their shareholders, associates (employees), customers, suppliers,
and the communities.
During 1999, the Company adopted recommendations of the SEC-sponsored Blue
Ribbon Committee. Since that time, the Company has continued its commitment to
strong corporate governance by implementing practices that strengthen its compliance
procedures and improve its financial reporting processes. During 2002 and 2003, the
Company built upon its strong corporate governance foundation by implementing a
number of new significant procedures which includes a Disclosure Committee, a
Corporate Compliance Council, a Policy and detailed procedures for the retention of the
Company's independent auditors; and New independence standards for Board members,
which meet or exceed the standards proposed by the New York Stock Exchange
The Company's Board of Directors is dedicated to continuing the Company's leadership
position in matters of corporate governance and to maintaining an active role in the
business. In addition to attending Board and Committee meetings, the members of the
Board regularly visit stores and engage in the operational review of stores throughout the
year. A substantial majority of the Directors on the Board are independent and each
Director serving on the Audit, Leadership Development and Compensation, and
Nominating and Corporate Governance Committees. Through its existing procedures and
with the guidance of an informed, engaged, and independent Board, the Company has the
structure and tools in place to continue to execute on its commitment to strong corporate
governance.
Canadian Tire continuously strives to meet the needs of its customers for total value by
offering a unique package of location, price, service and assortment. The employees of
Canadian Tire, its Associate Dealers, franchisees and agents all contribute to the
Corporation's objective to deliver top-quartile total return to shareholders among North
American retailers.
Canadian Tire
General Manager - This position is the highest management position available within a
Canadian Tire store. They are only outranked by the Associate Dealer who physically
owns the store. The GM is responsible for scheduling other managers, operating budgets,
creating policy and hiring new employees.
Store Managers - These people also can be known as duty managers in the sense that
they are just below the GM in rank. They typically are given the overall duty of running
day to day floor operations during their shifts. They can also write up employees and
lower managers, and conduct the termination of employees.
Logistics Manager - This manager is responsible for the stock and product within the
store. He or she is also responsible for the receiving crews, fill crews and deal crews who
mainly operate within the warehouse, commonly known in other stores as the 'stock
room'. These managers, depending on the GM can also act as acting store managers and
can supervise the entire store at a given time.
Department Manager - These managers control, supervise and operate an entire
department and the personnel within. These managers generally give the day to day
operational orders within the department, maintain the department in peak operating
shape, conduct disciplining of employees, and conduct employee reviews. These people
are generally assisted by subordinate Supervisors, who are a form of management, but
possess only the powers of seniority and signing of orders and rainchecks.
SWOT ANALYSIS – Appendix G
Strengths
Home depot is Canada’s largest home improvement retailer and operates in 10 Canadian
provinces and 49 US states with 23,000 Canadian employees. These employees are
composed of home improvement, construction and building maintenance professionals.
These employees mastered in 40,000 to 50,000 different kinds of building materials,
home improvement supplies and lawn and garden products. Home Depot is the leader in
employee development and volunteerism and for this Retail council of Canada recently
recognized Home Depot’s leadership in this area with an award for Excellence in
Employee Development at the Retail Council of Canada's 2002 Excellence in Retailing
Awards. Moreover, for eight consecutive years, Home Depot has been ranked by Fortune
magazine as America's Most Admired Specialty Retailer.
Strengths of Canadian Tire:

CTR is Canada's leading hardgoods retailer and operates 459 stores from coast to
coast through its network of entrepreneurial Associate Dealers. Canadian tire has
a large selection of national and retail brands through three 'stores' under one roofautomotive parts, accessories and service; sports and leisure products; and home
products-each of which has a large share of the Canadian market. CTR owns
Canadian Tire Petroleum, Financial Services and Mark’s Work Wear house.
Comparison:
Home Depot

Focused more on Community
development and focuses less on
revenues.

World’s Largest Home Improvement
retailer.

Each store stocks approximately 40,000
to 50,000 different kinds of building
materials, home improvement supplies
and lawn and garden products.

Retail council of Canada recently
recognized Home Depot's leadership in
this area with an award for Excellence in
Employee Development at the Retail
Council of Canada's 2002 Excellence in
Retailing Awards.

For eight consecutive years, Home Depot
has been ranked by Fortune magazine as
America's Most Admired Specialty
Retailer.
Canadian Tire

Focuses more on revenues than
Community development

Canada’s Leading hard goods retailer.

Large selection of national and retail
brands through three 'stores' under one
roof-automotive parts, accessories and
service; sports and leisure products; and
home products-each of which has a large
share of the Canadian market.

A commitment to ethical business
practices, a key part of operating with
honesty, integrity and respect, is core to
the values of Team Canadian Tire.

Owns Canadian Tire Petroleum,
Financial Services and Mark’s Work
Wear house.
Weaknesses
Canadian Tire

Complex business structure therefore
decision making will be a costly in
regards to time. This is derived from
high levels of in store inventories,
Canadian Tire contacted BRAMSS to
design an inventory control system to
reduce inventory costs and maintain
high service levels. BRAMSS designed
a data collection procedure and a
model to efficiently compute optimal
ordering policies which satisfied a
service level constraint.

Products are very slow moving

Home Depot
Complex and busy business structure cause time consuming and bad customer
service. Many people, though, see nothing but dread here. They see a store with
no helpful salespeople, a jumble of product, none just quite right, a very very long
checkout line and fear of having to come back and return something. The fear
(very real) of something big falling from the top of one of these shelves and
squashing them like a bug.

Staffs doesn’t have enough knowledge about products and services

Due to its safety regulations, Home depot has an obligation to provide a safe
environment for its quarter of a million workers and the millions of shoppers that
visit its stores each year

Not a good installation service
Comparison:
Both stores have very crowded design that confuses the customer and is very time
consuming for one to find their needed product and sales people’s lack of products
information adds to that. Also, both companies have problem providing safety for
their customers and employees due to heavy volume of products stocked in stores.
Canadian tire has decision making problem very slow inventory turn over as a result
of its high level of inventory. On the other hand, Home Depot has huge customer
service problem again resulted from too much inventory.
Opportunities
1. Potential Demand Changes
More than 70% of the existing houses in Canada are more than 20 years old and in need
of some repair and it is expected that six million house owners will finish renovation in
2006. People realize a house is probably the best investment they will ever make so they
want to take care of them. This situation provides Canadian Tire and Home Depot huge
business opportunities to increase their sales as well as their markets.
The gas price increases cause people to change their cars to oil-saving types. It could be a
potential threat to Canadian Tire's petroleum business. However, oil shortage does not
become a big problem to Home Depot.
The new generation of consumers is more concerned about saving their time and having
high quality of services. As many huge retailing companies expand their merchandise
inventory varieties, Home Depot concentrates on segmenting their markets to meet
different customers' needs. Other than having product lines crowded together, they open
different stores. For example, Home Depot white house supplies stores provide designing
experts with professional products, and landscape supplies stores provide gardening stuff
to professional gardeners. Additionally, Home Depot even makes contract with CARP to
hire more 50+ years old people to work in their stores, so that they can more fit the baby
boomers' requirements.
2. Global Economics, Development and Globalization.
The “Information technology era” brings business people to put their eyesight on the
global markets. Home Depot (after they successfully expanded in Canada, Puerto Rico,
and Mexico) has opened 2 Home Depot stores in China. This area’s economic
development provides a good background for Home Depot's development.
Canadian Tire, with its vision statement only focuses on the Canadian domestic market,
and do not have any plants to extend their business to global markets. However, with its
very successful operating experience and sufficient knowledge about retailing, petroleum
and financial services, they do have an opportunity to expand internationally.
3 Demographic Changes
As people are living longer than before, the population in communities becomes a
dominating change in Demography. Older people are more wealthy and experienced in
shopping. They have more money and more time to spend than any other age-range.
However, their needs are seldom studied and explored, which leaves a big opportunity for
retailers such as Canadian Tire and Home Depot to explore.
Women are more and more taking charge of the household purchasing tasks, which has
become the big trend as well as big opportunities for retailers to attract and meet their
demands. Home Depot in the U.S is taking its partnership with Trading Spaces (the
popular tv show) to the next level by offering "Do-It-Herself” workshops that teach
women about topics previously featured on the hit reality show such as tiling a
backsplash, building a headboard, and designing unique table tops. More than 200,000
women took part in these workshops during the first year alone. Home Depot Canada will
following the similar way as its U.S. stores.
Threats
Canadian Tire

rising oil and petroleum prices

competitors: Rona and Home Depot

Development of hydrogen fuel cells and other environment friendly fuel could
cause petroleum bars to not be needed anymore

other retailers providing financial services or better rates and incentives from
current financial institutions.
Home Depot

competitors: Lowe’s in the United States, Rona and Canadian Tire (Retail) in
Canada, other retailers in places where they plan to expand.

costs in expanding into other nations and exchange rates

communities who oppose the idea of having Home Depot around.

higher prices of housing in areas could cause people to rent instead of buy homes
to renovate.
Comparison:
Since Home Depot is the bigger retailer, it has more direct threats from its retailer
competition than Canadian Tire does, and more to lose if housing prices were to increase.
Canadian Tire’s main threats are from rising oil and petroleum prices as well as Banks
and other financial institutions.
Resources – Appendix H
Websites
www.canadiantire.ca
www.homedepot.com
www.tsx.com
www.nyse.com
www.nunetcan.net/ctccc/ctccc.html
www.lifesite.net/ldn/2005/feb/05021408.html
http://www.optimizemag.com/issue/033/leadership.htm
http://www.gsb.stanford.edu/news/headlines/vftt_nardelli.shtml
http://www.rtmilestones.com/article.asp?ArticleId=1866
www.marketingteacher.com/Lessons/lesson_PEST.htm
http://en.wikipedia.org/wiki/Category:Canadian_Tire
http://en.wikipedia.org/wiki/Canadian_Tire_Corporation
www.homedepotfoundation.org/
www.homedepotcenter.com/home/default.sps
http://en.wikipedia.org/wiki/Home_Depot
www.buildings.com/Articles/detail.asp?ArticleID=1509
www.urlwire.com/news/060402.html
http://moneycentral.msn.com/content/P114438.asp
www.optimizemag.com/article/showArticle.jhtml?articleId=22101756
http://www.brandchannel.com/features_profile.asp?pr_id=260
http://www.ehmac.ca/archive/index.php/t-18835.html
http://www2.canadiantire.ca/CTenglish/corpidx.html
http://www.pollara.ca/Library/News/bricksnclicks.html
www.statcan.ca/english/sdds/document/5027
http://www.newrules.org/retail/news_archive.php?browseby=slug&slugid=97
http://www.ajc.com/sunday/content/epaper/editions/sunday/news_34156f33a62120e8004
0.html
http://www.theacorn.com/News/2001/0517/Front_Page/04.html
http://ir.homedepot.com/releasedetail.cfm?releaseid=184769
http://corpresponsibility.homedepot.com/safety.cfm
www.forbes.com
http://www.lfpress.com/cgi-bin/publish.cgi?p=119967&x=articles&s=shopping
http://www.netratings.com/news.jsp?section=new_pr#
Books/Other
Armstrong, Gary. Marketing – An Introduction
www.powerwise.ca/about/pw_092305_en.pdf
csrhomedepot.pdf
shareholder_views_csr1.pdf
Stores
Home Depot, Bridgeport location, Richmond BC.
Canadian Tire, Kingsway location, Vancouver, BC.