Canadian Tire executives uncertain about the future of its paper money
In a world of digital wallets, virtual currency and polymer bills can there still be a place for the coupons handed out by Canadian Tire?
While the retailer has alluded to its desire to end the 50-year-old tradition of rewarding cash or debit purchases with Canadian Tire money, in favour of a card-based loyalty program, the prospect has reportedly met some internal corporate resistance.
"How to Fix Canadian Tire," a feature published in the July/August issue of Report on Business magazine, has focused on its recent efforts to overcome the stubbornness long associated with the stores.
A recent $771 million acquisition of the Foranzi Group, the Calgary-based owner of a dozen different sporting goods store banners across the country, was seen as one way to update Canadian Tire's homegrown image. A decade earlier, it acquired Mark's Work Wearhouse for $116 million.
With new retail competition arriving from the U.S., diversification is expected to help the bottom line, although chief executive Stephen Wetmore has also sought to refresh the core stores.
The first priority involved restoring the original story behind the Canadian Tire name. Where auto parts depots were once removed in favour of more general merchandise, they have now reappeared with products displayed at eye level.
Yet, the acquisition of the Foranzi Group is expected to help the company reach a new generation, which is unlikely to grasp the antiquated appeal of currency mascot Sandy McTire. There's only so much sentimental value attached to a 5-cent bill.
Curiously, debates over whether to keep or kill Canadian Tire money have come at the same time new approaches to the monetary system have reached a tipping point. Digital wallets, which eliminate the need for a bulging collection of cards, are expected to transform consumer spending.
Bitcoin, a digital currency that has stirred curiosity in the past few weeks, has also shed light on how our relationship with dollars issued by a central bank could change.
With the Bank of Canada's announcement this week of its new polymer notes, though, Sandy McTire's bills might end up being the country's last valuable form of paper money.