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Keith MacDougall

Forzani and the Canadian Tire Purchase

Started in Toronto on September 15, 1922, Canadian Tire has since grown to over 480 stores and has moved into a wide range of side ventures. Canadian Tire operates gas stations all over the country and also owns Parts Source, a smaller auto parts retailer. Mark’s Work Warehouse was started independently in 1977, but was acquired by the Canadian Tire corporation in 2001. Today, two-thirds of Canadian adults shop at Mark’s at least once a year.By the end of 2011 we will be able to add one more name to the Canadian Tire family. A 771 million dollar move is in the works to buy Forzani Group Ltd., who specializes in sporting goods retailing. Never heard of Forzani Group? While the name may not ring a bell for most consumers, the outlets they operate might. If you have ever gone into an Athletes World, or a Sport Check, you have been a customer of the Forzani Group.So why the acquisition? Canadian Tire already has a sports selection, but it is mostly aimed at the low level, or inexperienced athlete. Sport Check is the solution to the problem demanding athletes have with Canadian Tire merchandise.Few would claim that Sport Check carries world class gear, but they do appeal to the intermediate to advanced market. This is a key demographic Canadian Tire has been missing. Most of the sporting goods Canadian Tire carries are cost effective, low end gear by bigger name brands such as Adidas and Schwinn. With this move, Canadian Tire will take a bit of a strangle hold on the sporting good market. They can now serve every athlete up to advanced, with elite athletes still likely to choice specialty stores. As CEO of Canadian Tire, Stephen Wetmore put it as such: “Canadian Tire is Strengthening its credibility as… Read More

America’s Debt Ceiling

America has always been about big; big cities, big statues, big meals and of course, big debt. While it may be some time before we see America put a ceiling on burger size, they have officially hit their debt ceiling. What is a debt ceiling? It is the maximum legal amount that the American Federal government can borrow. It is essentially a really high credit card limit with a limit that is currently set at 14.294 trillion dollars.There are now two proposed courses of action. Treasury Secretary Tim Geithner says that the limit should be raised, in order to “protect the full faith and credit of the United States and avoid catastrophic economic consequences for citizens.” Although, congress is not having any of this at the moment, at least not until there have been serious talks with the Obama administration. Congress is refusing to up the debt limit until Obama makes significant cuts to spending.So, one may be asking, if the ceiling can simply be raised once reached why bother having a debt ceiling at all? Well since 1964, there have been 74 raises of the debt ceiling, and now we are looking at another. In essence that debt ceiling is a political tool. It is for policy makers to tailor their spending towards, and when it comes time to raise it again, attention is drawn to the debt and pressure can be put on to control it.Attention has indeed been drawn by both sides of the argument, with congress not willing to raise it until the Obama administration gets spending under control, Tim Geithner has set a date of August second for congress to have reached an agreement. At this point Geithner will be out of tricks to keep the debt down, and America will have reached a pivotal… Read More