SMALL BUSINESS MONTH - Supplement to The WInnipeg Free Press - Wednesday, October 23, 2013
Small business survival tips: Passion for the work isn’t enough to be a successful entrepreneur
Terry Mullin photographed at James & Dickson in Calgary. Photo by Adrian Shellard/For Calgary Herald/Special Projects
Experts are your friends: Successful business owners realize their limitations. While owners need to be a jack-of-all-trades when running a business, they still need the help of experts - masters of accounting, finance and legal affairs, says Jack Courtney, a small-business consulting expert with Investors Group. “When small businesses start out, the owners are often looking for the advice that can help them get going with the least amount of cost,” Courtney said. But as the business grows, getting the right advice is essential. Lawyers, accountants and other business professionals can be costly up front, but they can often save businesses money in the long run by helping them avoid costly pitfalls. Know your enemy: Successful businesses offer great products that customers want at a good price. But this simple formula is only effective for so long. Success attracts competition, Bushell says. To keep thriving, businesses have to differentiate themselves from their competitors. In large part, that’s why it’s so important to regularly update the business, he says. “You have to almost reinvent yourself. It’s an ongoing thing.” Keep ‘em smiling: More than any other ingredient for success, a business needs loyal customers. They are a business’s lifeblood, and all of the aforementioned tips won’t amount to much without keeping them satisfied. “After all it’s far easier to build a business with repeat business than it is to go out and find new customers all the time,” Bushell said.
hoping everything works out from there.” Owners often get caught up in the daily workings of their business when the revenue is rolling in, and they forget that with the highs come the lows. Having a regularly updated plan helps strengthen a business so it can endure the tough times and come away stronger to be even more profitable when the good times return. Evolve or die: Business is often referred to as ‘survival of the fittest’ for a reason. “It’s really an evolution,” said Mullin, with James & Dickson Clothiers. The menswear store has survived in a market dominated by chains because it’s changed along with its clientele. “Now we sell sport shirts and slacks of various styles and types - everything from denim right up to $300 pants of expensive, quality wools.” Most businesses operate in markets that do not remain static over time, Bushell says, so owners must be vigilant, offering products and services that adapt with the changing times. The right staff: Too often business owners overlook the importance of hiring good employees, and providing them with good compensation and training. “Few businesses actually view their employees as an asset rather than a necessary expense,” Bushell said. Hiring employees with a passion for the business is essential, but employers also need to keep their staff happy, ensuring they know their hard work and skills are appreciated. And money does talk when it comes to keeping good staff around, Mullin said. “They need to earn a proper living.”
By Joel Schlesinger For Postmedia News T erry Mullin has been a small-business owner long enough to know how to roll with Calgary’s boom and bust economy. As co-owner of James & Dickson Clothiers in one of Calgary’s more upscale neighbourhoods, he’s seen the marketplace for men’s clothing change significantly over the last two decades. It hasn’t always been easy for the store since it started in 1992. “You rarely hear of new menswear stores opening,” he said. “More have closed in the last 20 years than have opened.” But James & Dickson has survived and thrived, offering high- quality suits and casual wear for discerning clientele. Many veteran entrepreneurs have their share of battle scars. They’ve experienced near misses that could have closed the doors for good and they’ve savoured hard-won successes. Learning to avoid or recover from your mistakes is one of the secrets of maintaining a successful small business. Here’s little helpful advice from the experts to get you through the rough times - a short small-business survival guide for entrepreneurs to navigate the rough waters. Plan, plan and plan some more: Most small businesses know the importance of a business plan, but many fail to keep planning as they grow, says Brent Bushell, executive director of the Business Link, a government-funded non- profit business consulting organization in Alberta. “Don’t just do the initial stage planning and then roll the dice
Calgary Herald
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SMALL BUSINESS MONTH - Supplement to The WInnipeg Free Press - Wednesday, October 23, 2013
Marc DeGagne (left) and Erin Crampton from Crampton’s Market. Photo by Darcy Finley/For the Winnipeg Free Press
Crampton’s Market Crampton’s passionate about seasonal, local food
Those fortunate enough to get a CSA share can pick up their produce at the market each Wednesday. There are CSA protein shares of free range meat as well. Crampton’s also runs an onsite bakery and makes its own pickles and salsa. If Erin’s husband Marc DeGagne wasn’t her partner in the business, she’d probably never see him, she laughs.
believe that,” she said. “It’s great to see people putting vegetables in their kids’ mouths.” Crampton’s Market is up for a Manitoba Chambers of Commerce 2013 MBiz Award for Outstanding Small Business. “We want people to feel like they’re arriving at a party when
By Holli Moncrieff For the Free Press E rin Crampton wants to change the way you eat. The owner of Crampton’s Market is passionate about supporting seasonal, locally-grown food and goes to extraordinary lengths to do so. Crampton opens the market, at the intersection of Waverley Street and Bishop Grandin Boulevard, before Mother’s Day and closes it on the Sunday before Thanksgiving Day. During those five months, she works from 6:45 a.m. until 7:45 p.m. seven days a week, including holidays. “When it’s our open season, all we do is work. I’m happy to do it because I know there is a break at the end,” she said. “It’s incredibly busy. We buy from over 100 small, family-oriented producers who are trying to make a living doing nothing but farming. Our customers can pick from the best products available throughout Manitoba.” Crampton believes in supporting seasonal, organically produced food. She’s introduced Community Sponsored Agriculture shares that allow her customers to buy shares of the produce grown during the summer and early fall. Nine spray-free and organic farms participate in the program. Crampton quickly sold out of the available 101 shares. Community Sponsored Agriculture (CSA) benefits both farmers and consumers, Crampton said. “It’s the most consistent purchasing the farmers have. Their business depends on it. Because we support organic farmers consistently, they have been able to grow more and more produce. Our farms can grow varieties for taste because we consistently purchase from them throughout the season,” said Crampton. “It really helps teach people about seasonal eating. Everyone gets this wonderful variety of stuff.”
they come here,” said Crampton. “I love handing out samples. It’s great to share our passion with our customers.” Even after the store closes, there’s no rest for Crampton and her team. It takes a week to close the market for the season, and then it’s time to make salsa. They use over 900 kilograms of tomatoes for their salsa making, which takes them until the beginning of November. After paperwork and meetings with producers, Crampton and DeGagne go on vacation from January until March. By the time they get home, it’s time to start hiring staff again. “There are multiple reasons we need to buy local. We need to have
“I married one of my customers and convinced him to quit his job at Manitoba Hydro and run the market with me. We’re running the world the way we think it should be run. All the money goes to all these local farmers. It’s so nice to know it’s not just about us,” she said. The market has grown increasingly popular as people started caring more about what they eat and where it comes from, she said. “The business has changed immensely and so has our customer base. When we first started, people thought they could find a bargain at our store because everything is locally grown,” Crampton
“There are multiple reasons we need to buy local. We need to have a say in how our food is grown and keep our economy strong.”
said. “Now they understand the amazing amount of work farmers put in. If you’d like to have smaller producers in rural Manitoba, you have to pay for it. You need to support it.” Crampton purchased the business from her parents in 1999. Running the market gives her the ability to implement new ideas quickly and have complete control over what is sold in her store. “Everything has a 24-hour turnover in the market. Fresh, in- season food is the only way to get your kids eating vegetables. I truly
a say in how our food is grown and keep our economy strong,” Crampton said. “What happens if the border closes? Stranger things have happened.” For more information about Crampton’s Market, please see their website at http://www.cramptonsmarket.com. “Our customers get it. We have never advertised. You have to seek us out,” said Crampton. “We’re here because we’re passionate about what we do, and people catch on to that.”
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SMALL BUSINESS MONTH - Supplement to The WInnipeg Free Press - Wednesday, October 23, 2013
Entrepreneurship Manitoba poised to offer critical services, support for small business
By Todd Lewys For the Free Press W hile big business tends to grab news headlines, it’s small businesses that are the lifeblood of the provincial economy. After all – over time, and with the right support – small businesses evolve into big business ventures. In recognition of that fact, the province moved to make it easier for small businesses to start up by initiating the process of streamlining its small business support services last April. All those services are to be consolidated into an entity aptly titled Entrepreneurship Manitoba. “The process of putting all the services under one roof is moving along at a steady pace,” said said former Entrepreneurship Minister Peter Bjornson in early October. Bjornson is now Minister of Housing and Community Development. “There are still a number of issues to be addressed, but we expect the grand opening to happen in the not-too-distant future, hopefully before the New Year,” he said. “It’s a big job to consolidate small business services, but we’re doing our best to get everything ready to go as soon as possible.” “Once all the services are consolidated, entrepreneurs can anticipate an experience that’s going to be much more user-friendly,” added Bjornson. “Streamlining the services is going to be of tremendous benefit to small businesses,” he said. “For example, we’re the first jurisdiction in Canada to go with one business number. Previously, small businesses had to have separate numbers for their registration, name, taxes. Reducing things to having just one number has been a huge plus – it’s made it much easier for small businesses to concentrate on growing their business, not on endless administrative tasks.” Likewise, the province – after having eliminated the small business tax a few years ago – is now looking at including businesses that generate annual incomes in excess of a million dollars. “The changes we made there have had a huge impact,” he said. “Prior to eliminating the small business tax, a small business with an annual income of, say, $400,000, was hit hard. Today, a business with that income is paying $52,500 less in taxes than they were in 1999. With the new budget that’s coming up, we’re moving toward including businesses who earn over $1 million dollars annually to ease their tax burden. Our goal is to make it increasingly easier to do business in Manitoba.” As important as it is to help small businesses get started through practical financial initiatives, it’s also critical that support services be in place to help those businesses sustain themselves. Entrepreneurship Manitoba will make it a priority to offer a variety of support services designed to help small businesses not only survive, but thrive in a highly competitive marketplace. “We will be offering a number of very affordable courses as before, but in addition to that, there will be a number of programs available to help entrepreneurs gain access to experts who will provide them with the advice they need to continue moving forward as a business,” Bjornson said. “They will be able to tap into the Manitoba Marketing Network for mentorship support. That type of support is essential. Tapping into the experience of successful business owners can help new owners avoid costly mistakes.” Not only can Entrepreneurship Manitoba connect nascent small businesses with established ones, but it can also provide the support required to bring a product to market. “Programs are going to be available through commercial support to help entrepreneurs take their ideas to market – we’re excited that there will be six different streams that businesses will be able to
go through,” he said. “The goal is to assist new companies in the development of their products, and to be with them every step of the way to ensure those products are developed properly.” Entrepreneurship Manitoba isn’t going to overlook the necessity of cultivating a continuous inflow of skilled labour into Manitoba’s workforce, he added. “One of the biggest challenges in keeping the province’s economy strong is maintaining a strong skilled labour force,” said Bjornson. “We are working continuously to meet labour shortages. In fact, we hope to celebrate a milestone in that area by late fall or early winter: a total of 10,000 active apprentices in Manitoba’s workforce. I’m pleased to say that number has doubled since 1999. It’s not a sexy topic, but it’s one of the most important things we’ve been doing since we took office 14 years ago.” For more information on Entrepreneurship Manitoba and the services it offers – such as BizPal, BizPaS, financial assistance programs and many others, all under one roof – see www.gov.mb.ca/ctt/ emb or call 204-945-8200, or toll-free 1-855-836-7250. Former Entrepreneurship Minister Peter Bjornson says consolidated services for small entrepreneurs will make for a more user-friendly experience. Winnipeg Free Press Archives
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SMALL BUSINESS MONTH - Supplement to The WInnipeg Free Press - Wednesday, October 23, 2013
(From left) Shaan Sabir, Najma Sabir, Michael Hoffer and Hélène Hoffer from Water Mart. Photo by Darcy Finley/For the Winnipeg Free Press
‘Triple threat’ key to success for Winnipeg small-biz owners Complementary ventures thrive with human touch, solid team
return, the shuttle will pick them up at arrivals and drop them off at their vehicle. AirPark also offers a number of different services, including indoor and outdoor long-term parking, a car wash and interior detailing, free emergency battery boost and compressed air for deflated tires. Located just two minutes from the Winnipeg Airport, the parking and shuttle service is busy during the winter, but not so much in the summer. So the Hoffers created WaterMart as a complement for AirPark. WaterMart is a purified water company located nearby at 866 King Edward St. The Hoffers say all their businesses were created out of necessity. They came up with the idea for AirPark after another venture failed. “We had to do something immediately. We had to keep going. It was always about not having enough money or overcoming a difficult situation,” said Hélène. “Since our first day when only four cars used our facility, AirPark has come a long way.” LED Outdoor Advertising began with one LED sign on King Edward Street that promotes AirPark and WaterMart, along with third party advertisers. The Hoffers are in the process of obtaining a second sign on Pembina Highway. “LED Outdoor Signs complements the other businesses because we advertise them on our signs,” Michael said. “It’s a very rewarding
time for us right now. Airpark is doing better than it’s ever done.” The Hoffers are firm believers in reciprocal business. WaterMart supports many of its customers’ businesses, such as small auto shops, restaurants, catering companies and office suppliers. These same customers continue to give them business and refer them to their other clients. Hélène says that word of mouth and referrals is their least expensive marketing strategy but one of the most effective. “In business, the more you give, the more you get back. People often forget that. Life works that way — you pay it forward,” she said. “That’s always been the way we live our lives and it’s the way we do business, too.” Another secret of their success is surrounding themselves with great people. “We have a very strong manager who allows us to grow. We work well as a team. We all have different strengths and weaknesses,” said Hélène. “We have a great accountant and a wonderful banker. It might be more expensive to invest in those resources, but it’s worth it at the end of the day.” The Hoffers won the 2013 Assiniboia Chamber of Commerce Small Business Excellence category award. “You have to love what you’re doing and surround yourself with strong people,” Hélène said. “We have a lot of fun, too.”
By Holli Moncrieff For the Free Press T hey may own three businesses, but Hélène and Michael Hoffer still greet all their customers by name. “A lot of businesses forget the human aspect. We always try to be better, to make our services more effective and customer-friendly,” said Hélène. “You have to run your business the same way you run your life.” Hélène and Michael are the brains behind Executive AirPark, WaterMart, and LED Outdoor Signs. Hélène takes care of the number crunching and deals with bankers, while Michael handles the marketing and advertising. A chilly winter walk was the inspiration behind Executive AirPark. After returning home from a flight, Michael had to walk a long way with his luggage in a snowstorm, and couldn’t find his car. “As we all know, Winnipeg in winter can be pretty fierce. We decided Winnipeg needed an airpark, so we started one,” Michael said. AirPark is a fully-enclosed heated parking facility that is monitored 24/7. Shuttle service picks customers up at their vehicles and drops them off in front of the terminal doors. Upon their
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SMALL BUSINESS MONTH - Supplement to The WInnipeg Free Press - Wednesday, October 23, 2013
Pace of change remains slow for Canada’s small businesses
The same survey showed heightened optimism in Atlantic Canada, while regions such as Ontario still need to regain some of their footing. “There’s definitely a huge focus on helping get small business on their feet and a lot more investment in local industry. With lower interest rates, they have the ability to improve efficiencies on the operational level.” While businesses may not be facing a clear run at growth, there could be some momentum in higher growth sectors such as technology in 2014. According to John Muffolini, technology media telecommunications leader for Deloitte in Toronto, “A lot of technology companies are seeing some optimism. It’s showing fast growth versus static sectors such as manufacturing, consumer goods and distribution.” Technology is also attracting more attention from investors. Those who were sitting on the sidelines are now putting funds back into the sector, and the startup community is getting a big boost from a growing number of incubators and accelerators. Other SME sectors with more promising prospects include health and fitness, specialty food stores, employment services, computer consulting, and business management and support, says Ted Mallett, vice-president and chief economist with Canadian Federation of Independent Business in Toronto. “Manufacturers dealing with niche products or processes that can’t be easily copied are also optimistic about the outlook.” He agrees the economy has settled down into “a bit of an underperforming phase. Everybody was hoping for the U.S. and European Union economies to show a way out of the recession, but it has taken longer than expected. Whether we’re in or out of the yo-yo is hard to say.” One bright note is that financing is less of a hurdle for SMEs than in previous years, says Pierre Cleroux, chief economist and vice-president of research for BDC in Montreal. He reports that the approval rates for financing were 90 per cent in 2011, versus 80 per cent in 2009. “Having said that, knowledge-based younger
Denise Deveau Postmedia News W hen it comes to Canada’s small business landscape, the prospects may not be bright but they’re no worse than they have been in recent months. Small and medium enterprises (SMEs) as a whole continue to struggle with a sluggish economy and increased competitive forces with marginal results to show for their efforts. “To be brutally honest, not that much really has changed,” said Doug Porter, chief economist for BMO Capital Markets in Toronto. “From a macroeconomic standpoint, the economy is still grinding ahead at modest (1.5 per cent) growth rates, currency is still close to parity and interest rates remain low.” This comes as no surprise, he adds. “We weren’t expecting a whole lot out of Canada’s economy this year. It’s lacklustre at best. And we’re not getting much help from our biggest trading partner.” While there have been some subtle changes, indications are that the coming months will bring more of the same. Interest rates are not expected to rise dramatically over the near term, and the dollar will hold relatively steady in the months to come. Manufacturing continues to be one of the weakest sectors, although construction turned out to be more resilient than anticipated. Regional economies for the most part performed as expected, with the western provinces continuing on a growth curve led by Alberta. Newfoundland and Labrador has also shown above-average results. This bodes well for small businesses servicing the major industries in those regions. Sim Mehanger, commercial banking area manager, Bank of Montreal in Vancouver, says its research shows British Columbia’s SME community is showing above-average levels of optimism. “We’re definitely seeing food service, technology, natural resource and trades setting up independent businesses here. A lot of existing owners are also investing in their businesses in order to get themselves ahead of the game.”
BMO has newly minted Doug Porter as their chief economist. Peter J. Thompson/National Post
companies less than two years in business with younger owners have a bit more of a challenge in that area.” He identifies three key areas of opportunity worth considering. First, an aging population means a growing number of older people with more money to spend than previous generations. “That’s
creating a new market for a lot of SMEs.” Another is the escalation in online activity.
“Fifty per cent of Canadians are buying online, but only 17 per cent of SMEs are selling online. There are a lot of opportunities related to online activities, whether it’s to sell or simply communicate your products and services.” The third opportunity is emerging economies. “Growth is not happening in North America or Europe or Japan right now,” Cleroux said. “Small organizations have to rethink the way they do business because most of the opportunities are going to come from emerging countries with a growing middle class that has more money to spend.” The most important thing to remember is that despite the slow growth, small business success is essential to the future of the Canadian economy, Mallett says. “Big firms don’t just pop up by themselves. They start from a small base. The process of turning one small firm into a behemoth is what drives economic growth in this country.”
Making leap from groceries to junk
JustJunk.com owner/ operator David Hayes, left, and employee Pat Middleton in Windsor, Ont.
Entrepreneur knows he’s taking away people’s memories
BDC SMALL BUSINESS WEEK TM October 20–26, 2013
Dave Hall Postmedia News
WINDSOR — After 25 years in the grocery business, Dave Hayes decided he wanted more autonomy and jumped feet-first into the junk business. The former manager for Loblaws and Shoppers Drug Mart left the security of a full-time job six months ago and launched a Windsor, Ont., franchise of Just Junk, a company which specializes in picking up large residential loads of appliances, furniture, household goods and other bits and pieces of junk. “I’d been looking casually at a variety of options and I was originally looking for something I could do on the side while still working at Zehrs,” said Hayes, who was managing a Superstore in Sarnia until he started his own business. “I was looking for a manager-type role in a franchise operation rather than something I’d have to do full-time. “But after doing some online research and talking to a group of Just Junk franchisees, it seemed to be a good fit,” said Hayes. “It’s essentially a service job, and that’s what I’m used to, but it’s still different enough to be fresh and challenging.” Hayes even went to Hamilton and worked on a Just Junk truck for a day to get a first-hand inside look at the company’s daily operations. “Management has been incredibly supportive and helpful in making sure the launch went smoothly,” said Hayes. A rival company no longer operates in the Windsor market, according to its website, and Hayes said the main competition now comes from fill-it-yourself bins. “They have their place, especially if you’re doing a day-long reno job, but for one-off pickups, we’re competitively priced,” said Hayes. Hayes said he and his employees also handle deck demolitions and hot tub removals, among other projects. “A lot of what we do involves estate situations where someone has died, so we’re sensitive to those situations as well,” he said. “We’re removing memories so you have to be delicate because those memories get more important as you get older.” Hayes said his one-truck operation picks up between 15 and 20 tons of junk a month and about one-quarter is recycled and never sees a landfill. “We work with Habitat for Humanity and donate whatever they can use and we try to recycle as much as possible because that’s what our customers expect,” he said. “A lot of people do care where their junk is going and if we can recycle, why wouldn’t we?” Bookings are largely made online through JustJunk.com and a potential job starts with a free quote. A pickup is usually scheduled on the same day. Hayes said Just Junk charges by volume rather than weight with one-16th of a truck costing $50, a half-truck load costing about $300 and a full load of 400 cubic feet up to $450. “If we fill a full truck after emptying out a basement, attic or crawl space, it will likely be the full amount, but if the junk is stacked in a garage or a driveway for easy loading, that’s taken into account with a reduced price,” said Hayes. Hayes currently has three employees, one full-time and two part-time with plans to add more as business builds. Just Junk was launched in St. Catharines and now has locations across Ontario, Nova Scotia, British Columbia, Alberta, South Carolina and North Carolina.
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SMALL BUSINESS MONTH - Supplement to The WInnipeg Free Press - Wednesday, October 23, 2013
Calgary and Saskatoon top entrepreneurial cities list
Snow blankets the Rocky Mountains looming behind downtown Calgary. Photo by Ted Rhodes
Mallett said it’s not surprising that regions are doing well. “Suburban areas seem to be hot spots for entrepreneurial growth for a number of reasons.” First, he said, is the ability to acquire land and build new structures rather than convert an old space. “You can build or acquire something more tailored to your needs.” Rent is also cheaper in the suburbs than a downtown core. “When you are starting up a business, you don’t want to burn through your capital too quickly.” When it comes to Canada’s smaller cities, Alberta and Quebec each had four cities in the top 10, while Ontario rounded out the mix with two. Ken Kolby, president and chief executive of the Alberta Chambers of Commerce, wasn’t surprised to see his province do as well as it did. “Every community in Alberta is open for business and every community in Alberta is doing well,” he said, noting that natural resources and agriculture are both strong, as is tourism. “A lot of our key areas are really firing,” he added. Kolby expects Alberta to continue to do well. “We’re seeing a huge increase in young entrepreneurs,” although he warned that labour shortages continue to cause a drag. However, he said Alberta’s boom spells opportunity for entrepreneurs in other centres, particularly Ontario manufacturers. Nearly 5,000 houses will have to be replaced from the spring flooding — each of which will require new furnaces and hot water tanks — it spells opportunity, as does the growing oilsands and shale gas, which often require precision manufacturing. “I would invite those folks who have product manufacturing in Ontario to come out to Alberta and bring their order books. We’re open for business.” Gerald Pisarzowski, vice-president of business development for the Greater Toronto Marketing Alliance, said information technology is driving growth in Canada’s biggest urban centre. “This year for us will be the best year ever in terms of new investment,” he said.
As well, infrastructure companies from Europe have been shopping for office space to focus on planned projects here in Canada, including metro transit in Toronto and energy projects such as Churchill Falls in Newfoundland, he added. “Those kinds of large-scale projects have been attracting investment.” Another area that is booming is food processing. Pisarzowski noted that Del Monte is opening its first plant in Canada in Oshawa. He said the greater Toronto area’s multicultural makeup provides specialized food companies with a good gateway into the Canadian market. Kelowna cracked the top 10 this year, jumping to eight from 15. Mayor Walter Gray, a former local radio station owner, said it dates back a couple of years to when a new council was elected and he ran on a theme of “We’re open for business.” Since then, Kelowna has undertaken a number of projects revamping the town, including building a $5-million public wharf, paid for by the private sector, and rejigging its main thoroughfare, Bernard Avenue, to make it a “destination and not just a street,” he said. The $14-million investment upgraded utilities, and made the sidewalks wider to accommodate restaurant patios and encourage people to go downtown. More bicycle paths have been built to foster “active transportation.” Kelowna’s airport is also booming and is the 10th busiest in the country. He said the airport is “one of the drivers of our economy.” People will retire to Kelowna and can still do consulting. “Kelowna is a great place to work from. It doesn’t have to be Vancouver, Calgary or Toronto.” So where are the places to avoid if you are an entrepreneur? Quebec City, Montreal and Kingston scored at the bottom of the list for big cities, while Duncan, B.C., Courtney, B.C. and Cornwall, Ont. ranked lowest for cities under 150,000. As for the future, Saskatoon Mayor Atchison is optimistic his city, with its low tax rate, will continue to attract entrepreneurs. “We have what the world wants: food, fuel and fertilizer.”
Jim Middlemiss For Financial Post E ntrepreneurs looking for less red tape and more profit might want to consider opening an operation in Saskatoon. “We talk to new businesses that move to Saskatoon and they tell us that this is probably the easiest city that they have ever worked in and how quickly things go through,” said Saskatoon Mayor Don Atchison. “The only mistake they tell us they made was not coming here sooner.” He said companies tell him their Saskatoon operations boast some of the highest productivity and profit levels, which he attributes to a “strong work ethic” and “new immigrants moving here who want to succeed.” For the second year in a row, Saskatoon is one of Canada’s top two entrepreneurial cities with populations exceeding 150,000, according to a survey by the Canadian Federation of Independent Business (CFIB) conducted for the Financial Post , entitled Communities in Boom. The survey examined 107 cities across Canada and ranked them for their entrepreneurial activity. Saskatoon narrowed the gap with its rival to the west, the Greater Calgary Area, which ranked first once again, but just barely. Ted Mallett, vice-president and chief economist at CFIB, said the attitude of local government toward business is critical for entrepreneurs. “If business owners feel the local government is on their side and making positive movements to help businesses start and grow, it makes those investment decisions so much easier.” He noted that sectors such as energy, agriculture, information technology and mining continue to attract entrepreneurs. Once again, surrounding regions dominated the top rankings for big cities. Greater Toronto jumped two notches to rank third, while Greater Edmonton ranked fourth, down one spot from last year. Sherbrooke, Que., rounded out the top five.
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SMALL BUSINESS MONTH - Supplement to The WInnipeg Free Press - Wednesday, October 23, 2013
Vin Room owner Phoebe Fung stands in the basement dining room at her Mission restaurant which had to be completely rebuilt after the June floods. Fung had to replace everything including the 100 year-old satur- ated brickwork. Photos by Gavin Young
High water and hard lessons: Historic Alberta floods were a devastating blow to small businesses
If anything was learned from the catastrophe, Fung says, it was the importance of taking matters into her own hands. “We had insurance, but we had the ability to start rebuilding without waiting for the insurance approval.” Fung says she used a line of credit to start rebuilding as soon as possible. “If you wait for things that you don’t have any control over, you’re just adding to the timeline to recovery,” she said, noting many businesses in the neighbourhood remain closed to this day. Some may never reopen. For small business owners everywhere, the floods serve as a cautionary tale, says Brent Bushell, the executive director the Business Link, a government-funded non-profit organization providing consultation services to entrepreneurs. “It’s so important to be prepared for the worst,” he said. “The first thing is to prepare, but that’s often easier said than done.” He likens disaster planning for small businesses to having a will. Everyone knows it’s important, but most people procrastinate. “That same mentality exists when it comes to disaster planning in the small business world,” Bushell said. Having a plan involves more than getting insurance for fire, flood and other unexpected catastrophes because it can be weeks before a business owner sees a cheque from the insurer. Meanwhile, an entrepreneur faces three threats to the business’s survival. “For one, the revenue that you’d be earning is gone,” he said. “Two, your supplies and inventory may be completely destroyed, and the suppliers are still going to want payment.” Third, a business needs cash to rebuild, which can be in short
supply because there’s no revenue. But the proper insurance coverage can help address many of these issues, says Gord Enders, president of the Insurance Brokers Association of Alberta. “Business-interruption insurance can help you cover those expenses.” The recent disaster highlights the importance for business owners to take a close look at their coverage and its limitations, Enders says. In particular, they should examine their flood coverage closely, or simply make sure they actually have that coverage. Business flood insurance is an option offered by many but not all insurers, Enders says. Even insurers offering this option are re-evaluating the risk in areas now designated as flood zones. “It depends on what the company’s appetite is for risk, but it would be safe to say that at the moment insurance companies are underwriting those risks differently.” Fung says she is thankful she had paid the additional premium for flood coverage. Although she had to pay thousands dollars out of pocket, insurance softened the impact significantly. “You’re losing tens of thousands of dollars instead of hundreds of thousands of dollars,” she said. Yet it took more than insurance and money to reopen, she says. People power played a big part, too. “It was pretty amazing to see the volunteers come down not expecting anything in return,” Fung said. “They were essential, giving us a big head-start.” Calgary Herald
By Joel Schlesinger For Postmedia News
CALGARY - Even before the floodwaters had receded from Vin Room in Calgary’s upscale Mission district, its owner was working the phone to get the small business on its feet again. “I come from oil and gas, so there’s no such thing as down time,” said Phoebe Fung, owner of the popular wine and tapas bar located about three blocks from the Elbow River, which poured over its banks in June. “As the water was coming in, I was phoning tradespeople and ordering the supplies I knew I would need to rebuild.” During the historic flood, which forced the evacuation of one- tenth of the city’s population, Vin Room Mission was among dozens of businesses inundated by water from the swollen Elbow and Bow rivers that flow through the centre of Calgary. In a matter of hours, the most costly natural disaster in Canada’s history wreaked more than $1-billion in damages upon thousands of businesses and homes in Calgary and other southern Alberta communities. The heritage building where Vin Room is located suffered hundreds of thousands of dollars in damage. The basement that housed the wine cellar filled with more than three metres of water. Overland flooding poured through the front door, destroying the original hardwood. “We took everything down to the studs,” Fung said. “It was like a brand new rebuild for us.” The restaurant was closed for 39 days.
Greenhouse industry spurs city’s growth
Your Entrepreneurial Journey Begins Here
Jamie Cornies is shown in his English cucumber greenhouse. Courtesy of Farm & Food Care Ontario.
The numbers are surprising. Of the 224 OGVG members, 85 per cent are located in the Leamington-Kingsville area. OGVG members have 908 hectares of greenhouses around Ontario and expect that to hit 960 ha. by 2014. They grow more than 300 million English cucumbers, 165 million bell peppers and 189 million kilograms of tomatoes. About 70 per cent of this produce is shipped to the United States. Leamington, one of Canada’s most southern communities, is a big draw because of the weather and its proximity to the Windsor-Detroit border crossing, about 50 kilometres away. Gilvesy said Leamington has one of the highest levels of sunshine in Canada and the evenings cool down from being on Lake Erie, making it an ideal climate for greenhouses. He also notes that the trend to healthier eating is helping drive growth. Jamie Cornies, a third-generation farmer who grows mini-cucumbers and owns Cornies Farms Ltd., said “the services are here, the suppliers are here, the business concept is here. It works.” But these aren’t the greenhouses of old. Today, everything is computerized from climate control to watering and they don’t use chemical pesticides, but rely on biological pest control. “We use the good bugs to fight the bad bugs,” Cornies said. Mayor Paterson said local councillors work hard to expedite building permits and he hopes that by achieving the cluster status it has around greenhouses, Leamington can start attracting supporting industry and further expand its industrial tax base. “There are so many sides of this industry that could cluster right here,” he said, from greenhouse manufacturing to automation and the science side of growing, such as biological pest control. One of the big challenges is securing enough energy to drive the growing sector and the area is fighting to obtain its own separate hydro line. Also, while farmland prices soar, Paterson said “in comparison to other areas of Ontario, we’re cheap.” Agriculture has been Pickard’s key to success. Whether it’s producing packaging for tomatoes, cucumbers, mushrooms or peppers or even the local commercial fishery, food is at the centre of his business. “It’s a very, very good agri-food town.” But like any small town, business owners have to prove their mettle and show commitment. “People in our community want to see that you are invested in the community and believe in them by having a presence. These guys want you to become part of the community. They appreciate that and put more faith in you.”
Jim Middlemiss For Financial Post K eith Pickard has seen firsthand the economic boom engulfing the picturesque farming region in Leamington, Ont., thanks to a rapidly growing greenhouse industry. “The work ethic and growth of greenhouse growers, which are mainly family businesses, is second to none,” said Pickard, chief operating officer of The Jakait Group, which provides packaging and shipping services to greenhouses. He launched his business in 2005 with three employees and one truck in a rented barn, and revenues that first year hit $650,000. Today, he employs 96 people at peak season and revenues top $25 million. His 15 packaging machines run from six in the morning until two the following morning producing boxes, and his fleet of trucks has expanded to 22 with 85 trailers. Pickard got into the business almost by accident. He was working at a greenhouse that competed with his soon-to-be in-laws. “I wanted to do something that didn’t compete with the family.” However, he knew the potential of the greenhouse industry and decided to enter the “service side.” He hasn’t looked back. “The community is very receptive to growth,” he said. “The biggest obstacle was winning the trust of the business people.” Leamington has jumped into third spot from 33 for cities with populations less than 150,000 in this year’s Canadian Federation of Independent Business and Financial Post survey of top entrepreneurial cities. Much of Leamington’s growth is attributable to the booming agricultural industry. Ted Mallett, vice-president and chief economist for CFIB who oversees the survey, said the “agri-sector is a kind of seed bed for entrepreneurship. It generates an awful lot of new entrepreneurs.” Leamington Mayor John Paterson said “the last few years in this area have been really, really good. Leamington has a long history of greenhouse operations from the small mom-and-pop shops to what we have now.” George Gilvesy, general manager of the Ontario Greenhouse Vegetable Growers (OGVG) based in Leamington, said “we have more acres of greenhouses here than anywhere else in Canada or the U.S. Our greenhouse sector is world-class.”
Entrepreneurship Manitoba offers a range of services to businesses and entrepreneurs at every stage of the business life cycle, including: � information on starting and growing your business � company registration and searching � business counselling � financial programs � workshops and seminars Contact us today: 204-945-8200 toll free 1-855-836-7250 embinfo@gov.mb.ca manitoba.ca/emb
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SMALL BUSINESS MONTH - Supplement to The WInnipeg Free Press - Wednesday, October 23, 2013
Silicon Valley, Calgary style:
City’s small, but innovative high-tech sector a hotbed for startups aiming to change the world
Transcend Coffee founder Poul Mark in his Garneau Coffee Shop in Edmonton. Photo by John Lucas/Edmonton Journal
Edmonton café chain finds its niche in crowded coffee market Aroma of success
Douglas Hagedorn, founder of Invici. Photo by Adrian Shellard
which is funded by the Alberta government and the University of Calgary. “I prefer the idea of having our own tech sector’s reason for existence.” And its raison d’tre has been the oil and gas sector. “This is an area where we can absolutely be a world leader,” said Garrett. While supportive of all types of high-tech companies in the city, Innovate Calgary’s strategic focus has been developing firms providing innovative technologies for the exploration, development and production of oil and gas. “We can become the Silicon Valley of energy technology, whereas in the IT and life sciences areas we’ll certainly have our share of niche successes, but relative to other areas of the world we won’t have the same broad level of success,” Garrett said. One firm that has found success through serving oil and gas is Hifi Engineering, a maker of fibre- optics technology. “It’s basically using fibre optics to monitor the flow of fluids in the production of oil and gas or the transportation of hydrocarbons, like pipeline operations,” said John Hull, founder and president of the Calgary firm. “We turn fibre optics into an acoustic sensor and it’s much more sensitive, allowing you to monitor several kilometres simultaneously.” The company has been in business for six years and, like many high-tech, energy-sector-focused firms, it has moved from the startup to the commercial phase. “Several of our technologies are commercial, installed in 500 wells to date.” Hull says Calgary is the place to be for technology firms, with innovative ideas offering applications for the energy sector because the local investment community is very savvy. “Several of the major companies have innovation funds that we’ve been able to tap,” he said. “They often have their own funding facilities.” Calgary Herald
By Joel Schlesinger For Postmedia News
CALGARY - Invici is a Calgary tech startup that doesn’t want to revolutionize the classroom. The maker of interactive educational technologies is looking to make the school experience more accessible. Invici has only been in business for a little more than a year, but its interactive, touch screen technology for the visually impaired is already generating interest among educators. “Our target market is the classroom where teachers are working with visually impaired students,” said Invici chief executive officer Douglas Hagedorn, who came up with the concept while working on his master’s thesis in geography at the University of Calgary. “We’ve developed a tactile computer system - a user interface - for the blind that allows you to feel through a physical representation of features that are displayed on an LCD screen.” Invici is just one of several high-tech startups in Calgary, a city more renowned for oil and gas deals than for nurturing technology firms. But there have been a number of high-tech successes over the past decade, including intellectual property licensing firm Wi-LAN, now based in Ottawa, and iStockphoto, which is still headquartered in the city. Today, Calgary is home to several promising tech companies, from life science firms like Zephyr Sleep Technologies, a maker of innovative equipment for sleep apnea, to body positive social media app maker, BeauCoo. While information technology and life science firms have flourished over the last few years, they represent a fraction of the abundant high-tech firms in the Stampede city, says the head of technology business incubator, Innovate Calgary. “I’m not really a big fan of the comparison to Silicon Valley,” said Peter Garrett, president of the non-profit,
Dan Barnes Postmedia News
EDMONTON — In a retail sector that positively brims with competitors both monolithic and minuscule, tiny Transcend Coffee’s cup remains at least half-full of idealism. It’s an expensive ingredient. The owners of Edmonton’s two-café chain — down from three after they closed a too-large, money-losing outlet earlier this year — prefer to pay more to Central American suppliers for top-notch, or as they call them, zero-defect green coffee beans. Devotion to quality is integral to their mission statement and paying more for it is a means of walking the walk, not merely talking the talk, on sustainability. It has also been their most overt attempt to differentiate themselves from the rest of the retail coffee klatsch in Edmonton. But they have discovered that the sustainability message is popular with most retailers, regardless of corporate commitment level along the bottom line. “The average price we’re paying for coffee this year is $4.82 per pound. The commodity price is at $1.15 the last time I checked, so we are about four-times market right now,” said marketing director and part-owner James Schutz. “For most folks in the coffee business, this would seem much too high but that’s what we’re paying. We’re after the very best quality and want to pay sustainable prices to the farmers, so we’re willing to pay the high prices.” He said they shell out for an extra manual sorting of beans in Costa Rica, which they believe results in roasting a much higher percentage of beans without defects. “One sour bean can ruin a whole pot of coffee,” said Schutz. Starbucks says it sourced 545 million pounds of green beans from 29 countries in 2012 and paid an average price of $2.56 per pound. The ubiquitous coffee giant — there are 18,000 outlets worldwide — also said 93 per cent of its coffee was ethically sourced last year. Tim Hortons, meanwhile, has introduced its Partnership Blend, and says a portion of sales will be directed to improving the sustainability practices of its partner producers in Brazil, Colombia, El Salvador, Guatemala and Honduras. Tim Hortons issued a statement in mid-September saying it sells two billion cups every year, enough to fill 26,504 Olympic-sized swimming pools. The company also boasts about its roast, saying only three people in the world are aware of the “exact blend and roasting fingerprint” of their coffee, and that their team of coffee masters taste-test more than 75,000 cups each year to ensure quality. Sustainability isn’t just about paying more. It’s about volume and best practices. “No matter how good the coffee you are growing, you need to get a certain amount out of each hectare to make it work, no matter the price you’re getting,” said Sandy McAlpine, president of the Coffee Association of Canada. “There is a commodity price for Arabica, and the vast majority of coffee in Canada is Arabica. That price is about $1.17 a pound. But not a lot of coffee is bought at that price. Most is bought at a differential that is based on quality and availability.” Given that quality and sustainability themes abound, and the messaging can be confusing, how does Transcend, a company with two locations and 35 employees, set itself apart? Well, they roast those high-quality beans in a south-side facility not far from their Garneau café. And they do what they can on the marketing end. Transcend invested money and time building an online retail presence that was recognized recently by Canada Post for its efficacy. Transcend was a finalist in the multi-channel retailer category in an awards program. Schutz has piloted Transcend’s multi-channel effort, which includes non- stop video messaging inside their two locations and a weekly newsletter, which he writes, that is emailed every Saturday morning to more than 3,000 subscribers. They also accompany online orders of beans with personal messages for customers and offer free shipping on orders over $35, an initiative that costs them money. “About a year ago we focused on our online presence. We really paid a lot of attention to it,” said Schutz. As a result, online sales now represent about 10 per cent of Transcend’s total sales. More encouraging, online sales are up about 30 per cent over last year. “It could potentially be half our sales.” A cursory look around the Garneau café suggests the way to a Transcend customer is through his or her hard drive. The entire east wall banquette was occupied by customers working on laptops and occasionally sipping a beverage. Wi-Fi is important, but Starbucks was in that game long ago and Tim Hortons offers it now. Though Transcend has to compete on quality, sustainability and multi-channel marketing with multinational giants and small local shops, the coffee thirst in Canada is unquenchable and should allow them to occupy a comfortable niche. The 2011 Coffee Drinking Trends in Canada report said 64 per cent of adults drink an average of 2.7 cups per day for a total of 14 billion cups per year. Of those drinkers, 54 per cent are aware of Fair Trade practices and 35 per cent have purchased Fair Trade coffee. What’s more, Transcend identifies its customers along psychographic, not demographic lines, Schutz said. “People who care about how food tastes, those are the people who get us.”
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