It’s not too soon to speculate about who will lead the federal Liberals in the scheduled October election. The possibility of a Liberal caucus revolt cannot be discounted.

Margaret Thatcher was ousted by a caucus fearful that its unpopular leader would lead it to electoral defeat – the scenario now facing Prime Minister Justin Trudeau.

Caucus revolts in Canada have cost Joe Clark and Alberta premier Allison Redford the leadership of their parties, while other leaders have been eased out when they passed their sell-by date.

Trudeau’s public-approval ratings were already slumping before last week’s explosive testimony by Jody Wilson-Raybould that Trudeau and his top political aides improperly pressured her, when she was federal justice minister, to compromise Canada’s justice system on behalf of special pleader SNC-Lavalin Group Inc.

The Trudeau “war room” is dug in, expecting the current outrage to subside. But the Grit brand will be further weakened by still more allegations to come of unseemly conduct by Trudeau and the Prime Minister’s Office (PMO).

The unpopularity of the PMO is widespread in this government. The PMO’s pressure on Wilson-Raybould is but one of countless acts of meddling in the work of cabinet officers, committee chairs and backbenchers.

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A salve for those accumulated grievances would be the replacement of Trudeau and his PMO.

Trade, environment, aboriginal reconciliation, and judicial reform will top the agenda of whichever party forms the next government. So, the frontrunners to replace Trudeau include Foreign Affairs Minister Chrystia Freeland, Environment Minister Catherine McKenna, and another cabinet star, the winsomely principled Wilson-Raybould, Canada’s first justice minister of aboriginal heritage.

There would be contenders from outside cabinet, of course. But few can match the record of achievement of the women above.

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Is Kraft Heinz a bad omen for Tim Hortons?

Tim Hortons might hold iconic status for Canadians, but it is a mere outpost of 3G Capital, a partnership of Brazilian financiers.

The 3G formula is to pay top dollar for famous brands, then impose a cost-cutting regime described by Tim Hortons franchisees as ruthless, and aimed at short-term profit maximization over future growth.

That strategy has just backfired in spectacular fashion at 3G’s Kraft Heinz Co., which late last month reported a staggering $15.4-billion (U.S.) write-down of its slow-selling, Cold War-era brands. (I described the perils facing Kraft Heinz and Big Food last year.)

The Kraft Heinz disaster, in turn, accounts for most of the massive $25.4-billion fourth-quarter loss at 27-per-cent owner Berkshire Hathaway Inc., Warren Buffett’s conglomerate.

Meanwhile, 3G’s Anheuser-Busch InBev SA, owner of the Labatt brand in Canada, is suffering market-share losses to innovative craft brewers.

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Buffett and 3G co-founder Jorge Paulo Lemann have each admitted they’ve lost touch with the consumer-goods market. “I’m a terrified dinosaur,” Lemann told an investor conference last April. “I’ve been living in this cozy world of old brands [and] big volumes.”

How long will it be before 3G’s practice of starving budgets for R&D and new-product development will harm Canada’s favourite meeting place?

The performance of Restaurant Brands International Inc. (RBI), 3G’s umbrella for Tim Hortons, Burger King and Popeyes, is not encouraging. Shares in RBI have flatlined in the $82 (Cdn.) range after impressive early gains, and RBI profits dropped nearly 6 per cent last year.

3G allows that many of its RBI stores need an overhaul.

Actually, what Tim Hortons needs is to be un-yoked from a 3G that has a demonstrated ability to overpay for assets and an inability to wisely manage them.

Troubled HBC tries to shrink to success

Hudson’s Bay Co. (HBC) will likely suffer the indignity of being dropped this month from the S&P/TSX Composite Index.

HBC remains one of Canada’s biggest retailers, with sales last year of $14.3 billion. But the value of the firm’s publicly traded shares has dropped to just over $500 million, no longer qualifying for inclusion in the index.

HBC has lost 53 per cent of its stock-market value in the past five years, and has posted total losses in the past two years of $1.1 billion.

The prospect of HBC stock gains would be diminished by the shares’ absence from the index. Institutional investors feel obliged to hold stocks in the most prominent indexes. Along with the popularity of index funds, index inclusion helps stocks gain value. And vice versa.

HBC has made some progress in unwinding chairman Richard Baker’s failed strategy of turning HBC into an unwieldly congeries of retail chains, notably with its recent merger of a troubled European retail chain with its chief rival. Baker’s gambit was badly timed for dynamic change in consumer preferences, and the rise of Amazon.com Inc. and other e-commerce vendors.

HBC still has too many stores, despite HBC’s February announcement that it will close its Home Outfitters chain and shed about 20 of the 133 outlets in its underperforming Saks Off 5th chain.

HBC still has considerable power as a brand, if not as a merchandiser.

Given Baker & Co.’s failure to make a success of HBC after 11 years, HBC’s future might be as an HBC-branded apparel and accessories line owned and marketed by someone else, the Weston family’s Holt Renfrew, Canada Goose Holdings Inc. or Canadiana purveyor Roots Corp.

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