HSBH McMaster

Industry / Company
Briefly describe background information on your chosen business sector and
Canadian company, and why you chose that industry.

Identify the Opportunity

Identify the main opportunity available to Purolator and describe the
challenges / growth available to your chosen business sector
Using reputable secondary search, briefly describe any recent (not older than
2011) major trends or events faced by the industry that may relate to the
opportunity / challenge faced by your company.

Recommendation
Briefly state your team’s innovative idea.

Canada’s largest business sectors have remained constant. Advancements in

technology (changing values and habits) have given rise to new ventures and
business types.

**Select an emerging or growing business sector and company in Canada (B2B

or B2C). Provide an outline of the growing business sector and company, its
clients / target audience, rationale for why this business is growing, and the key
challenges faced by the business. What can Purolator do to “win-over” or attract
companies in this business sector? Assume a budget of 1,25,00,000 INR**

1. Describe the growing business sector

 E-Commerce (Electronic commerce) is the buying and selling of
goods and services over an electronic network, primarily internet.
These transactions occur either as business-to-business, business-to-
consumer, consumer-to-consumer, and consumer-to-business.
 Ecommerce has been a bright spot among retail channels during the
coronavirus, as consumers became reliant on digital transactions
amid physical store closures and fear of infection.
 In the last decade, widespread use of e-commerce platforms such as
amazon and Ebay has contributed to substantial growth in online
retail. While in 2007, E-Commerce comprised of only 5.1% of total
retail sales, in 2019, e-commerce made up 16.5 of all retail sales
worldwide which accounts for a massive increase of 27.6% in
 comparison to the previous year. This figure is expected to continue
growing and is projected to reach 22% in the year 2023.
 Canada has seen the fastest growth in this sector with 72.7 increase in
E-Commerce spending totalling 28.6 Billion USD.

2. Why is this business sector growing?

 There are numerous reasons why E-Commerce popularity has been
surging.
 Availability – Visitors can browse and shop at absolutely any time at
the convenience of their home.
 Speed of Access -Having to physically go to a shop to realise that the
product you needed is out of stock can be gruesome. Even worse when
the shop is crowdy and it takes you a lot of time to get through the
billing. Likewise you can order anything in e-commerce platforms
whenever you want with no fear of the required product being out-of-
stock in a matter of few clicks (few seconds or less).
 Wide Range of goods and products. Globalisation has made it easy to
access new products from various countries and have it delivered to
your home without much cost at all. (International reach)
 Lower cost – globalisation. E-Commerce sites don’t pay rent,
inventory, cashiers etc, they bore only the shipping and warehourse
costs making it easier for them to provide goods to customers at lower
prices while having a profit of their own.
 Personalisation and product recommendations – E-Commerce sites
track visitors’ browse, search, and purchase history. This data proves
useful to recommend products and obtain valuable insights about
target markets.

3. What challenges does this business sector face?

 Limited customer service
 Not being able to touch or see a product before buying
 Wait time to have the product delivered
 Security from hackers and trackers
 Delivery network and time (Faster the deliveries the better for the
consumer and the business)

4. Identify a Canadian company in this space.

 SHOPIFY (Vendors offering e-commerce platform services for clients
hosting their own online store sites).

5. Who is the target audience of this Canadian company? How do they reach
their consumers?
  Unlike a lot of companies, Shopify was incentivized not just to sell
their product to customers, but also to help customers become more
successful on the platform. The more money customers made, the
more money Shopify made. This drove Shopify to help their users
become better merchants, and that’s the biggest reason they’ve grown
to where they are today.
 The company began from ‘making it easy for everyone to create a
beautiful and powerful online store” to “making commerce better for
everyone”. This meant the transition from making it easy to sell
products online to making it convenient for merchants to sell their
products anywhere, at any time. Thus, expanding the company from a
product-first to movement-next by refocusing from their e-commerce
tools to a broader mission of helping everyone sell both online and
offline.
 Gradually, shopify is getting into more distribution channels and
casting a wider network. And as long as they get a cut of each
transaction, the company is confident that making all forms of
commerce easier will keep driving the company’s growth.

6. What are some opportunities and watch-outs for Purolator?

 Although Shopify has a wide-reaching network of its own, it is yet to
have a large operating network that Purolator already has.
 A business corporation between Purolator and Shopify would be
mutually beneficial.
 Purolator is known for its Large Network meaning Fewer hand-offs,
better Customer Service, and Improved security. Not to mention
Purolator is known for its logistics division.
 To Shopify which is newly expanding its distribution channels,
Purolator can aid their merchants with the vision of a logistics
company. This means that with Purolator’s help Shopify’s merchants
plan, implement, and execute the movement and storage of products,
materials, and services throughout the supply chain from the point of
origin to the point of consumption.
 As for how this collaboration is beneficial to Purolator, Purolator faces
a threat from new entrants because of reducing costs and increasing
efficiencies. Purolator innovation business model can be easily
replicated despite the large number of patents and copyrights the
company possesses. Intellectual property rights are very difficult to
implement in the industry that purolator innovation operates in.
According to Jean-Louis Schaan, Ramasastry Chandrasekhar ,
Intellectual Property Rights are effective in thwarting same size
 competition but it is difficult to stop start ups disrupting markets at
various other levels.
 The culture of sticky prices in the industry and increasing costs
component for working in developed market can lead to losses.
 To maximise the use of existing strengths and to further minimise the
losses there is a need for innovation and expansion into Adjacent
markets / emerging business sectors. I suggest E-Commerce in this
case.
 Purolator deals with many small businesses who take advantage of
their freight and logistics service to develop a supply chain for their
own business. As such Purolator has viable opportunities to expand
into the E-Commerce and Social Media Oriented Business Models.
 If all the companies that Purolator works with were to be put together
in an e-commerce platform, it would give Purolator’s clients more
visibility and thus help them have better sales (a business model like
Shopify).
 A collaboration between shopify and Purolator could mean a mutually
beneficial agreement of Purolator being responsible for the delivery of
goods and products, while Shopify could be responsible for giving
Purolator’s clients more visibility and reach in the market as needed.

7. Aside from timely delivery service, what can Purolator do to be a better

business partner for this company?
 The given budget could be utilised to invest in the expansion of
Purolator’s reach by investing in smaller vehicles for promoting door-
to-door deliveries. As a pilot project this investment could be made in
the city of Toronto, the largest metropolitan city in Canada.
 Suggest their own clients to open an account in Shopify.
 Help Shopify clients with timely deliveries
 Deliver goods and products from Shopify to areas where Shopify
distribution network isn’t operating.

What is Purolator?
A courier, freight and logistics company. Help business’ save time through
customised shipping and supply chain solutions.
73 cities, 86 multi-functional facilities/assets, 5 dedicated freight facilities

Logistics Company helps businesses plan, implement, and execute movement

and storage of products, materials, and services throughout the supply chain
from the point of origin to the point of consumption.

Strengths
1. Large Network
(Package Visibility, Fewer hand-offs, Customer Service, Improved security)
2. Logistics Company

Weaknesses
1. Implementation of Technology
2. Purolator innovation business model can be easily replicated despite the
large number of patents and copyrights the company possesses.
Intellectual property rights are very difficult to implement in the industry
that purolator innovation operates in.  According to Jean-Louis Schaan,
Ramasastry Chandrasekhar , Intellectual Property Rights are effective in
thwarting same size competition but it is difficult to stop start ups disrupting
markets at various other levels.

Opportunities
 8. Opportunities in E-Commerce and Social Media Oriented Business
Models
9. Need for innovation and expansion into Adjacent markets / emerging
business sectors

Threat
1. Threats of New Entrants because of Reducing Costs and Increasing
efficiencies
2. Culture of sticky prices in the industry and increasing costs component
for working in developed market can lead to losses.