Canadian Tire Money - History and Dynamics

History and Dynamics

Arguably the most recognizable facet is the man featured on the face of each bill. According to Canadian Tire representatives, the fictional character represented is referred to as "Sandy McTire" and sports a stylized waxed moustache. He is based on no specific individual but is assumed to represent the everyman of blue-collar Canada.

It was introduced in 1958, and was inspired by Muriel Billes, the wife of Canadian Tire's co-founder and first president, Alfred J. Billes, as a response to the promotional giveaways that many gas companies offered at the time. It was only available at Canadian Tire gas bars but was so successful that, in 1961, it was extended to the retail stores as well, and has become the most successful loyalty program in Canadian retail history. The print on the 'notes' officially refers to them as cash bonus coupons.

Canadian Tire Money is given out for purchases paid for by cash or debit, based on the pre-tax total, excluding labour and shop supplies costs. The coupon rate earned was initially 5% of the eligible purchase price but was subsequently lowered to 3%, then to 1.4%, and now is 0.4%. Customers can use Canadian Tire Money to buy anything in the store. (Older coupons state that they are redeemable at Canadian Tire stores and gas stations; however, coupons produced during at least the last 15 years lack this wording and are therefore redeemable in the stores only.)

It can also be used to cover the sales tax on the purchases, since it is accepted as cash after the taxes are calculated. Also, even if a purchase was made entirely in these coupons, it is also considered as a cash purchase and more coupons will be calculated and paid out.

In Ontario, the Retail Sales Tax law and Bulletins state that the "coupon must be reimbursed by the franchisee". By submitting them to other merchants, the merchants were in essence breaking Ontario law when they failed to include the discount in the value of the goods being calculated for being taxed. Some merchants were accepting Canadian Tire Money as a discount, but then were not calculating and remitting the sales taxes, as required by law, and then were getting fined for the practice; this is an ongoing issue.

In 2012, Canadian Tire began a pilot program to make their money "plastic", to make it into a more manageable and trackable loyalty program. The new plastic loyalty card can earn points at more than twice the rate of the traditional paper money.