The next generation
On the occasion of Canadian Tire’s 100th anniversary, no mere cake will do. The company has instead announced $3.4 billion in spending that’s mostly aimed at e-commerce, new products and more private label sales. Unlike Amazon, with distribution centres shipping straight to customers, Canadian Tire will work through the stores. After all, the dealers and the pension fund own the rest of Tire beyond what’s in the hands of controlling shareholder Martha Billes. Tire, she likes to call it, not The Tire, just Tire. Dealers have to go through years of apprenticeship before they get their own store, but it is a guarantee to make them millionaires.
Tire was started one hundred years ago by the two Billes brothers, J.W. and A.J. After J.W. died, A.J. became sole owner. He had three children, Fred, David and Martha. Fred saw himself as heir apparent while Martha was left out of A.J.’s thinking. She fought for twenty years to finally buy the boys out in 1997 after A.J.’s death and become the majority 61.4 percent owner of Tire. She has wisely never tried to run operations, always hiring a professional manager as CEO. As CEOs are replaced, the board nominates a candidate, but Martha always conducts the final interview.
Despite all that family feuding early in her career, Tire has survived and thrived amid the onslaught of big-name U.S. retailers such as Walmart, Home Depot, and Costco. Today the company has more than $16 billion in annual revenue from some 1,700 outlets including Tire, Mark’s, SportChek and gas stations.
Other changes are coming. Maureen Sabia, longtime friend of Martha and chair of Tire, will retire in May. Recent company filings indicate that Martha’s only child, Owen, is in line to inherit the business. Now in his early 50s, Owen joined Tire in 1992, went on the board in 2004, and owns a Tire dealership in Welland, Ont. Martha has transferred one-third of her shares to him. With a market value per share of $325 each, Martha has ceded about $225 million worth of shares, leaving herself with shares worth $450 million. When I once asked her how she would like to be remembered, she said that she wanted her tombstone to read, “Nothing ventured, nothing gained.” As a summation of her life, no phrase could be more fitting.