Canadian Tire Expands Food

MARK HAMSTRA

TORONTO — Canadian Tire Corp. here is planning to expand the rollout of a limited food offering to additional locations of its general merchandise chain, the company said at an investor conference here last week.

The company currently has five locations testing the convenience grocery offering, and plans to roll the test out to another five locations this fall.

“We're testing food in these stores not to see how much food we can sell at lower margins than our average general merchandise, but to see what that does in terms of changing traffic patterns for the store,” said Michael Arnett, president of Canadian Tire Retail. “What I would say about food is that we like what we've seen in the first five stores.”

He said about one in four shoppers is making a food purchase at the stores.

“It's showing a level of customer acceptance there that we think is really important and bodes well,” Arnett said.

The outlets where food is being offered are part of Canadian Tire's “Smart Store” initiative, a nine-store test that includes a racetrack layout and other features, including improved signage. The Smart Stores are also testing a pet food offering as part of their redesign.

Traffic is up about 9% at the Smart Stores, which so far have been either newly built stores or relocations. This fall the company is planning its first Smart Store remodels of existing locations.

The grocery test, which includes some frozen products, as well as everyday grocery items like milk and bread, covers about 5,000 square feet in the stores. It was first launched in two stores late last year.

Arnett said the company planned to “try some new things” with the food offering as it rolls it out to additional locations.

“I believe next year we're going to come to a position on the role that food will play for us going forward,” he said.