Canadian Tire to delve further into financial services
Canadian Tire has announced the launch of its “One-and-Only” combined checking, savings and mortgage account for homeowners. The new product will allow users to fold all three into one financial product, according to the company.
The goal is to allow consumers to pay off debts faster, the company said, while consumers who open the account also will be able to earn bonus Candian Tire “money” for purchase of goods at the home improvement and automotive products retailer.
“We know from our consumer and market research that as the size of the average mortgage continues to grow, so does every Canadian’s desire to pay off that debt as quickly as possible,” said Marco Marrone, president of Canadian Tire Financial Services.
Canadian Tire jointly launched the Web site mortgageinyourway.com, to show consumers where and how they can save money with the One-and-Only account. The site includes a tool to help see how consumers can pay off their mortgages quicker, called the “Mortgage-Free Faster Tool.”
Canadian Tire operates more than 1,100 stores and gas stations in Canada. The company offers other financial services, including its “Canadian Tire Options MasterCard” and the Canadian Tire Auto Club, which offers emergency roadside assistance services.
Owens Corning completes siding business sale
Owens Corning, the Toledo-based supplier and manufacturer of insulation and building materials, has completed the sale of its siding business to French building materials giant Saint-Gobain.
The $371 million sale included Owens Corning’s Norandex/Reynolds siding distribution business with 153 distribution sites in the United States and manufacturing facilities in London, Ontario; Joplin, Mo.; and Claremont, N.C.
“This sale is part of our ongoing strategy to focus on core businesses that bring value to our customers,” said Dave Brown, president and CEO. “This transaction enhances shareholder value by strengthening Owens Corning’s ability to generate consistent profitable growth across its portfolio of businesses.”
The transaction completes Owens Corning’s previously announced strategic review of its “Siding Solutions” business, the company said in a statement.
Lowe’s, Home Depot look to new store formats
Columbus, Ohio-based retail research firm Retail Forward held its annual home improvement industry conference on Aug. 30, outlining the predictions for the next five years at the nation’s two largest home improvement retailers.
Both retailers face challenges in the coming years, but those challenges differ, analysts said. While Home Depot must deal with aging stores and fewer expansion opportunities, Lowe’s will face new challenges in Canada.
First, speaking on Home Depot, economist and senior consultant Steve Spiwak said the nation’s largest retailer faced impending market saturation, and predicted the retailer would follow through on plans to diversify its store formats to continue expansion.
“Home Depot has its work cut out for it,” Spiwak said. On top of a weak housing market and major competitive pressures from Lowe’s, “it’s facing market saturation and an aging store base.”
For that reason, rather than continue strictly in the 100,000-square-foot and larger big-box format, the company could be considering smaller “25,000- to 50,000-” square-foot stores, “about the size of a neighborhood hardware store.”
Spiwak pointed to the company’s purchase of Yardbirds, which became Home Depot’s small-format offering in the San Francisco area. “Those basically were a way to get into the lucrative San Francisco bay area,” he said, but added the Yardbirds format could serve as a good “testing ground” for other areas of the country.
Although Lowe’s does not face the same markets saturation problems as Home Depot, nor the same issues with aging stores, it has expressed interest in further exploring smaller-format stores in coming years, said Nick McCoy, senior consultant with Retail Forward.
Lowe’s is looking at “smaller markets and in-fill markets with smaller stores — 80,000-square-foot stores that have done fairly well,” McCoy said, adding, “anything less than 80,000-square-feet will be too small. Don’t look for Lowe’s to be opening small hardware-type stores any time soon.”
The companies both have found ways of dealing with the housing slump, in part by focusing on “non-traditional events,” such as football tailgating and back-to-school sales.
“We expect, of course, that industry growth is slowing,” overall, McCoy said. “We expect it to be cut [roughly] in half over the next five years,” from 8.5 percent to 4.5 percent.