Gordon Reid (businessman)

Reid returned to Canada and in May 1961 opened the first Giant Tiger store, with a $15,000 investment. The store was located at the corner of George Street and Dalhousie Street in Ottawa's Byward Market, in the building that had formerly housed Ottawa's French-language newspaper, Le Droit. Reid was so short of cash that he was unable to afford proper store fixtures, and had to build his own display tables.[2] Initially, he had intended to name his store Top Value Discount, but discovered that in Canada, the "Top Value" trademark was already owned by the Loeb grocery store chain. According to Reid, he made this discovery when he spotted the name on the side of the carton from which he was pouring milk into his breakfast cereal.[2] His second choice was "Giant Tiger", a name which had not been trademarked in Canada, although it was then being used by another of the discount chains that he had encountered in Ohio.

Reid chose Ottawa as the location for his first store because he believed that public service paycheques would ensure a customer base with a stable income. As well, the city still had a relatively uncompetitive retail environment, and in particular, no shopping centres.[6] This initial choice would reflect a long-time focus on selecting locations (usually in small towns) that were sheltered from direct competition with other retailers.[6] Reid's intention was to build a national chain, due to his belief that it was necessary to place large-volume merchandise orders in order get the best prices, which could then be passed on to consumers.[7] However, for years it was not possible to put this strategy into effect, as Giant Tiger's expansion was initially extremely slow. In its first year, Giant Tiger’s total sales volume was only $139,781, and Reid had to rely upon his wife's income as a teacher to cover expenses.[8] A second store was not successfully opened until 1965,[2] and by the chain’s tenth anniversary in 1971, Giant Tiger had only expanded to six stores, and its survival rested, to a large degree, on the fact that it was servicing uncompetitive markets.

Reid credits Giant Tiger's rapid growth in subsequent years to several changes in the company's business philosophy.

First, the chain altered its merchandise mix from its original focus on male-oriented merchandise such as hardware and sporting goods to an inventory emphasizing clothing and housewares, designed to attract a primarily female clientele. Since this change was made in the early 1970s, the chain's clientele has been about 75% female.[9]

Second, Reid made the key head office personnel into co-owners of the chain. By 1980, ownership was shared with ten other individuals. In a 1980 interview, Reid credited the agricultural cooperative movement as his inspiration for this innovation.[6] Making his employees into part-owners of the company ensured that, as in the coop movement, all employees would share a common interest in maximizing profits.

The third innovation, which Reid has always insisted is the most important component of Giant Tiger's long-term success, was its unusual method of issuing franchises. A 1980 article describes Giant Tiger's franchise system this way:

The company charges franchisees $1 up front plus a percentage of annual sales. Before the franchise is handed over, the manager must earn his Giant Tiger stripes by working for the company at least a year. Most franchisees come with recommendations from years of service in the retail business. 'We don't consider a person unless he has oodles of experience,' says Reid.[6]

The practice of issuing $1 franchises and of attracting the best managers from other chains has continued essentially unchanged since that time. In 2010, Reid reported that the issuing of no-cost franchises to experienced retailers "was a great way to get experienced people. Over the years we had a lot come from Woolworth, Kresge, Kmart and later Zellers." In the same interview, Reid stated that over twenty Giant Tiger franchises are now run by former Walmart employees, most of whom had been attracted by the same franchise system that he had introduced decades earlier.[4]

The first Giant Tiger franchise, for a store in Maniwaki, Quebec, was issued in the late 1960s to Jean-Guy Desjardins. The benefit of this new way of operating was felt immediately. Up to this point, Reid and his small head office staff had been trying to make all key decisions, with the result that, despite its small size, the chain was slow-moving and inflexible. But from the moment the change was made, "the [Maniwaki] store made money and I didn't have to do anything. [Jean-Guy Desjardins] did the advertising, he found the location, he merchandised it to suit his customers, he did everything…. And, I thought, 'by golly, that's a good system.' "[7]

The greater autonomy that could be permitted to franchise owners whose personal financial interests were symmetrical with those of the head office meant that there was less need for Giant Tiger to develop centralized systems. Eleven years after Giant Tiger's first experiment with franchising, Reid emphasized the flexibility that it gave his company: "The weakness of the chain stores is that they try to standardize."[6] Such standardization was not possible in a small chain which at the time maintained its low prices by locating in awkward and non-standard spaces such as converted bowling alleys or garages,[6] and which refused to put money into standardized fixtures or furniture, or to invest in standardized office systems. One newspaper reported that "Giant Tiger defiantly pretends the computer hasn't been invented. Its idea of a sophisticated inventory and accounting system is a bigger filing cabinet."[6]

In the early 1990s, as rumours spread of Walmart's likely expansion into Canada, Reid began to prepare his company for the challenges that would be associated with a much more competitive retail environment. He became a director of the Washington D.C.-based International Mass Retail Association[5] and began to travel regularly to American markets to study Walmart and the survival strategies of its more successful competitors.[7]

In more later years, Reid slowly relinquished direct control of Giant Tiger. In 1999, Reid resigned the presidency of Giant Tiger in favour of Jeff York, an executive with ten years' experience at the company.[10] In October 2010, Reid turned over the post of chief executive officer to Andy Gross, an executive with over 25 years' experience at Giant Tiger, who had, by this time, already inherited the presidency from Jeff York.[11] Reid remains chairman of the board.[11]

In 2013, news began to spread that the company was exploring the option of a possible sale. While the business remained profitable, Reid, as its largest shareholder, declared that he was looking for other opportunities after being in the business for more than 50 years.[12]