Sun, Jun 27, 2004 - Page 11 News List

Canadian Tire Corp to open Shanghai office


Canadian Tire Corp is opening a Shanghai office this fall as it increases the number of made-in-China products it sells in Canada, the country's biggest hardware retailer said.

"There has been some growth in the China supply to Canadian Tire and this would certainly reflect that," Canadian Tire spokesman Scott Bonikowsky told reporters in an interview Friday.

Bonikowsky would not say what percentage of goods sold at Canadian Tire comes from China, nor how much that percentage has increased over the past few years or might increase once the store has staff in China.

"What I will say is that the overwhelming majority is domestically sourced, but we do have an important part of program that would be from China as well and all of the Pacific Rim for that matter," he said.

Canadian Tire has had an office in Hong Kong for 25 years, and will keep that operation even after opening the office in Shanghai, Bonikowsky said.

The company also has an office in Seoul and one in Taipei.

Michael McLarney, editor and publisher of the hardware industry newsletter Hardlines, said that by opening an office in Shanghai, Canadian Tire is following the lead of many other hardware retailers.

McLarney said while Canadian Tire's Chinese-made products will be less expensive to manufacture than products made at home, their quality won't likely suffer.

"What they're doing is they're going over and having products made to spec," McLarney said. "They'll get right into the Chinese factories."

Canadian Tire's Bonikowsky wouldn't say what products the 452-store retailer currently imports from China or which new ones might be available in the future. But McLarney guessed much of the store's Chinese products involve its private-label goods, such as its Mastercraft tools.

Canadian Tire also owns clothing retailer Mark's Work Warehouse, which could benefit from the inexpensive textile market in China.

For shoppers, Canadian Tire's foray into China should mean the company will stay competitive with other retailers with operations in that country, including US-based Wal-Mart, the world's biggest retailer, which reportedly bought US$12 billion worth of Chinese goods in 2002, and Home Depot.

The decision to open an office in China comes as Home Depot, the US big-box home-improvement retailer, examines opportunities to open stores in China.

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