Review the takeover of the Forzani Group by Canadian Tire, announced on May 9, 2011.
For reference, you can use newspaper articles, company press releases, investment analyst
reports, interviews with the CEO, etc.; a good place to start would be;
http://www.theglobeandmail.com/globe-investor/canadian-tire-acquires-a-new-set-of-custo
mers/article2014865/ –
• What is the likely strategy Canadian Tire is pursuing?
Canadian Tire’s strategy is to create an unprecedented opportunity for business growth, to
explore diversity, and establish its position as Canada’s ultimate authority in sporting
goods. Canadian Tire would be looking to strengthen a core business category, and cease
an opportunity to create a Sporting goods super-brand.
• What is the likely reaction of their competitors?
The first concern of companies facing such a significant competitive move is to protect
their position or try turning the situation to their advantage. Competitors will most likely
focus on a direct response and instead focus on market share and earnings. Competition
will concentrate on differentiating products, or tapping into new markets. Finding a niche
will be the key to staying in the race.
• Do you think Canadian Tire will be successful?
Yes, I think Canadian Tire will be successful because the company will have a stronger
financial and strategic fit to accelerate growth in a core category. The transaction will
establish Canadian Tire as Canada’s ultimate authority in sports. Canadian Tire will also
gain from having access to an expanded customer base with FGL’s retail banners,
including mall-based shoppers and the important 18-35 year old customer segment.
References
Chapter 6. FORMULATING LONG-TERM OBJECTIVES AND GRAND STRATEGIES.
(n.d.). Retrieved May 18, 2014 from
http://www2.uhv.edu/wang/mgt6331/notes/chapter6.htm
Canada.gc.ca. (2011, October 05), Canadian Tire/Forzani Position Statement. Retrieved
May 18, 2014 from
http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03421.html