SMALL bUSINeSS MONtH - SUppLeMeNt tO tHe WINNIpeg Free preSS - WedNeSdAy, OctOber 22, 2014
Small BuSineSS month OctOber 2014
Small and medium-sized businesses are the cornerstone of the Canadian economy. They account for 99.9% of all Canadian companies and employ more than 60% of private sector workers. T he Business Development Bank of Canada (BDC) believes this contribution deserves to be celebrated. BDC Small Business Week activities provide an opportunity to celebrate, develop new skills, make new contacts, and plan for new opportunities. Events held during the week bring entrepreneurs together at conferences, luncheons and trade fairs across the country where they have the opportunity to learn, network and enjoy themselves in the company of their peers. Successful entrepreneurs focus on tried and
true strategies to take their companies to the next level. They need the right preparation and a solid roadmap. That means fostering excellent customer and supplier relationships, applying sound financial management principles and hiring the best people. Use BDC’s Small Business Week 2014 to go back to basics and reenergize your business. The origins of BDC Small Business Week date back to 1979 when BDC business centres in B.C.’s Lower Fraser Valley pooled their resources to organize a week of activities for entrepreneurs. This first event and the one that followed in 1980 were so successful that BDC officially launched BDC Small Business Week across Canada in 1981. The initiative was quickly adopted by Canada’s business community. In 2013, over 280 activities across Canada attracted close to 10,000 businesspeople to BDC Small Business Week. This BDC flagship event celebrates entrepreneurship at the local, provincial and national levels. For more information, see www.bdc.ca/sbw
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SMALL BUSINESS MONTH - SUppLEMENT TO THE WINNIpEg FrEE prESS - WEdNESdAy, OcTOBEr 22, 2014
Ambitious entrepreneur finds niche in getting
projects finAnced
Vancouver’s Matt Toner can talk the talk, and backs his startup pitches with solid proposals, reputable specialists
Matt Toner of Zeros 2 Heroes in Vancouver, B.C. Zeros 2 Heroes is a digital media company that’s won a City of Vancouver award for business innovation. They find, finance, develop and deploy a new industry innovation every year. Photo by Arlen Redekop
media campaigns. ARGo is to launch on Hootsuite’s platform this month. Toner has had notable success attracting seed-stage financing from private investors and sources such as the Canada Media Fund. The next — and bigger — challenge will be turning his early stage products into mainstream businesses. The former Bank of Canada economist, sometime playwright and 2013 NDP candidate for Vancouver-False Creek believes his success at raising early-stage financing comes from “the discipline to embrace failure instead of kidding yourself that it’s somehow going to work.” A lot of digital operators “go in hell-for- leather” and don’t realize they’re stuck in a rut until it is too late. “We have this model of an idea a year,” Toner said. “We know we have to move on to the next idea if this is not worthwhile.” Toner knows what he’s talking about. His first startup, We Media, failed spectacularly. “Four guys and a card table in a back office. Eighty employees. We raised $25 million, did presentations at the White House,” he said. “A year later? Gone.” We Media was to be a social network for people with disabilities. “It failed for the same reason that a lot of dot-coms failed back in 2000,” Toner said. “Too much money, too little common sense.” Toner is no fan of (CBC television show) Dragons’ Den-styled pitching for funds. “People have five minutes to tell their story and use 10 PowerPoint slides to convince you? It’s turned into an exercise for its own sake,” he said. Instead, Toner customizes a five-page proposal for three people, agencies or investors, and augments each project team with specialists with notable track records. His New York Rolodex helps. This summer, Zeros 2 Heroes won a City of Vancouver Award of Excellence for business innovation (Creative — Under 25 employees category.) Toner started the company in 2006 with funds from two angel investors and has leveraged that money ever since. He has about 17 employees. Each year, he starts with about four new ideas, knowing only one is likely to go through early-stage development. Toner seeks private and Canada Media Fund money to create an initial team of three or four of his staff. “We pull together a team of expert specialists to break a lot of eggs,” he said. “The road to success is paved with broken eggs.” jennylee@vancouversun.com
Jenny Lee Vancouver Sun A nyone can have a great idea, but few can weave the magic to get those ideas financed. It seems Matt Toner can. For the past four years, Toner, 45, has found financing to develop one ambitious new idea a year. In the past two years alone, he has raised $3 million. Toner is president of Zeros 2 Heroes Media, a small Vancouver digital media incubator that seeks ways to connect film, TV and games content creators with their audiences. His projects range from a social media tracking application to a TV show, and an application to help theatres use crowdsourcing to choose films. Toner comes up with project ideas by listening for complaints, a lesson he learned as vice-consul with Canada’s trade commission in New York in the late 1990s. His 2014 refinement? “Ideally, there’s a pain point, and ideally it’s one shared by people with big bank accounts,” Toner said. WannaWatch. It, his theatre crowdsourcing application, for example, grew from his discovery that most independent cinemas fill from 15 per cent to 20 per cent of available seats from Mondays through Thursdays. “Our solution tries to better manage that surplus inventory through a crowd- distribution model that lets audiences help program screens,” he said. Toner was sitting on an entertainment industry panel when an American film distributor and fellow panellist described the problem. “I grabbed my napkin in front of the water jug and started frantically scribbling this idea,” he said. By the end of the guy’s talk, Toner was ready to pitch. Three years and $1.5 million later, WannaWatch. It helps audiences find movies they want to watch, plan movie nights with friends and crowdsource choices to local theatres. Emerging Pictures, a network of 150 U.S. independent cinemas, intends to use the service to screen new, classic and cult films across the United States. Another project, Animism, is an animated children’s TV show with related interactive video games, mobile games and graphic novels. Created entirely in Vancouver, the first season aired on APTN last year and was profitable. Season 2 is in development. Toner’s social media analytics application, ARGo, started with the observation that most conventional entertainment producers and executives need a better measure of return on investment from social
Celebrating Manitoba Small
Business Week
Greg Selinger
Theresa Oswald MLA for Seine River 204-255-7840 TheresaOswald.ca
Bidhu Jha MLA for Radisson 204-222-0074 BidhuJha.ca
Erin Selby MLA for Southdale 204-253-3918 ErinSelby.ca
MLA for St. Boniface Premier of Manitoba
204-237-9247 GregSelinger.ca
Nancy Allan MLA for St. Vital 204-237-8771 NancyAllan.ca
Jim Maloway MLA for Elmwood 204-415-1122 JimMaloway. YourManitoba.ca
Sharon Blady MLA for Kirkfield Park
204-832-2318 SharonBlady.ca
Jennifer Howard MLA for Fort Rouge 204-946-0272 JenniferHoward.ca
Melanie Wight MLA for Burrows 204-421-9414 MelanieWight.ca
Ron Lemieux MLA for Dawson Trail 204-878-4644 Ron-Lemieux.ca
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SMALL BUSINESS MONTH - SUppLEMENT TO THE WINNIpEg FrEE prESS - WEdNESdAy, OcTOBEr 22, 2014
World Trade CenTre Winnipeg means business
Centrallia Manitoba, which also offered broader networking opportunities, breakout information sessions and a keynote speech from Business Development Bank of Canada (BDC) chief economist Pierre Cléroux. Velasco says the event drew more than 325 business leaders from every region of the province, including IT service providers, transportation and engineering firms, management consultants and major employers such as Manitoba Hydro, Magellan Aerospace and Manitoba Liquor and Lotteries. “It was very diverse and many of those diverse shops were smaller players in the 20 to 50 employees (range),” he says. “It was a good way to get the business community in its broader sense together with the whole idea of wanting to leverage the connections that they could establish locally.” The provincial government is also seeing the value for Manitoba business. Recently, the province announced $1.9 million in funding for WTC Winnipeg over two years, plus $700,000 to organize Centrallia 2016. WTC Winnipeg is a member of the World Trade Centres Association, which represents more than 300 World Trade Centres in nearly 100 countries. Velasco says WTC Winnipeg’s mandate is to increase trade, and its mission is to bring the world to Manitoba businesses one connection at a time. “And that applies to any business — the
one or two-person operations to the over-500 operations, because going global may mean different things to different people in different companies,” he says. It might mean finding information that will prepare them to enter global markets, whether in Europe, Asia, South America or the U.S. Some businesses may want to find partners who have the technological knowledge or contacts to help a Canadian business grow and expand to new markets, or they might find new suppliers who
can help lower costs. “Going global, establishing connections in other countries, might mean many different things for businesses, so it doesn’t just restrict that to large players.” Velasco adds that Centrallia 2016 will be another opportunity to raise the profile of Winnipeg and Manitoba on the world stage, and to show off new facilities, including the revamped RBC Convention Centre Winnipeg and the Club Regent Event Centre.
By Pat St. Germain For the Free Press W orld Trade Centre (WTC) Winnipeg’s success with business- to-business networking events is snowballing. Early feedback from participants at Centrallia Manitoba, held Oct. 8 - 9 at the new Club Regent Event Centre and Canad Inns, suggests Manitoba will have a major presence at the third international version of Centrallia in May 2016. “It’s been very encouraging, because we’ve been hearing from small companies and big companies saying that they were very happy … that they have established more contacts and that they will definitely be signing up for Centrallia 2016,” says Alberto Velasco, WTC Winnipeg project manager. Modelled on France’s Futurallia, the inaugural Centrallia was held in Winnipeg in 2010. Following Centrallia 2012, when more than 700 participants from 35 countries gathered here to forge global business connections, Manitobans reported that they made some of their most valuable contacts with other local businesses. They asked for a Manitoba-specific Centrallia to find opportunities and forge connections on a provincial level, and WTC Winnipeg obliged. Organizers used Futurallia match-making software to set up 30-minute meetings between Manitoba businesses of all sizes during
Business InfoCentre is Here to Help
The Business InfoCentre (BIC) at WTC Winnipeg, in St. Boniface’s historic old city hall at 219 Provencher Blvd., is holding an official launch, on Thursday, Oct. 23 from 5 p.m. - 7 p.m. While BIC opened on April 1, the launch is an opportunity to meet the team and get acquainted with the centre’s services and resources. B usiness information officers provide guidance for entrepreneurs who need help starting or expanding a business, including information on government grants and financial assistance programs, taxes and regulations, permits and licenses, creating business plans, import and export procedures and registering your business. The centre also offers personalized research services, and it presents more than 100 free seminars each year, in French and English. registrants can attend seminars in person or via an online platform called WebEx. Upcoming seminars organized by WTc Winnipeg and BIc:
• Write Your Business Plan: Credit Worthy Financial Statements, Tuesday, Oct. 28, 9 a.m. - noon This seminar is designed to assist new entrepreneurs through the business process. It is part of a series consisting of six sessions. • PST: Intro to Provincial Sales Tax, Wednesday, Oct, 29, 9 a.m. - 11 a.m. The provincial Sales Tax is an 8% tax applied to the retail sale or rental of most goods and certain services in Manitoba. Find out when and how to apply it to the sale of your goods and services.
• Planning Your Marketing Program, Wednesday, Oct. 22, 9 a.m. - 11 a.m. Learn how you and your team can develop a plan that everyone can agree to and can execute. • Legal HR Requirements, Thursday, Oct. 23, 9 a.m. - 11 a.m. Employers need clarification on issues of human rights, harassment and reasonable accommodation. Learn about updates to legislation on Hr and workplace safety.
For more information, email nroche@wtcwinnipeg.com, call 204-289-4068 or visit www.wtcwinnipeg.com.
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SMALL BUSINESS MONTH - SUppLEMENT TO THE WINNIpEg FrEE prESS - WEdNESdAy, OcTOBEr 22, 2014
What is a Return to Work (RTW) Program? Preventing workplace injuries is the most effective way to protect workers and control an employer’s workers compensation costs. When injuries do occur, an effective RTW program is the best way to minimize the impact of an injury, promote recovery, and manage associated costs. Each workplace and worker is unique. Therefore, RTW programs must evolve and be customized to meet the specific needs of individual workers and workplaces. Key principles based on participation, communication, responsibility, and early intervention will help ensure your program will be a success. Why Have a RTW Program? A timely and safe return to work can help injured workers recover quicker. There are financial, legal, and moral reasons to have RTW programs in place to help workers recover after an injury. RTW programs benefit workers, employers, unions and health- care providers. Who is involved in a RTW program? A team approach to a RTW program works best. The team generally includes the worker, employer, health-care provider and, when requested by the worker, their union representative or other worker representative. RTW programs are workplace specific and workplace driven. The WCB is available to support the RTW process, and will become involved if there is a dispute regarding RTW issues, or if a worker or employer requires financial or technical supports for the RTW to be successful. What is the role of the WCB? • Help with financial or technical support • Become involved if there is a dispute • In certain cases, facilitate and attend RTW meetings as a part of the RTW team • Monitor RTW and assist with wage loss payments • Become involved where there are concerns • Determine if the employer has met re-employment obligations WCB Can help you manage an effeCtive RetuRn to WoRk pRogRam
Employer Benefits of a RTW Program • Retains valued employees • Reduces costs associated with training and recruiting replacement staff • Helps maintain productivity • Improves workplace morale • Reduces the costs of injuries • Helps employers meet legal requirements related to Human Rights and WCB re-employment legislation
What is the Role of the Employer?
• Offer workers meaningful modified or alternate duties • Be flexible so that the RTW program can be tailored to meet the individual needs of the workers. • Communicate your RTW program • Communicate with injured workers throughout the recovery process to show that they are valued and help them retain a connection to the workplace • Ensure that supervisors and co-workers support injured workers during the process
Expect to hear more about RTW in 2015 as the WCB reaches out to employers and health-care providers. For more information, visit us on the web at www.wcb.mb.ca.
Injuries prevented and lives saved that’s the VALUE of SAFEWork safemanitoba.com
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SMALL BUSINESS MONTH - SUppLEMENT TO THE WINNIpEg FrEE prESS - WEdNESdAy, OcTOBEr 22, 2014
Debbie Van Camp, left, and Ilona Makar, directors with the Calgary Business Women Network, pose at a networking meeting. Photo by Wil Andruschak
Advice You cAn BAnk on
Joel Schlesinger For Postmedia News Y ou could call them the league of extraordinary women. After all, the group of 80 or so female entrepreneurs who gather every month as part of the Calgary Business Women Network are among some of the leading business people in the city. To its founders, Debbie Van Camp and Ilona Makar, the network is more than a place for corporate mucky-mucks to rub elbows. It’s a networking opportunity for many of the city’s women small business owners, including themselves. “It’s the best day of the month for us when we go there and see the connections that women are making, helping them build relationships and their businesses,” says Makar, who also works as an independent marketing consultant. “It feeds your soul to see that happening.” Started about five years ago, the network is one of countless organizations in Canada that supports women entrepreneurs. And their numbers are growing. The business world has certainly come a long way from the stereotypical image of drinking, cigar-chomping, backslapping men in suits. Women are making their mark, especially when it comes to small businesses. According to Government of Canada statistics, women are owners or co- owners of 47 per cent of small- and medium-sized businesses across the country. And they now tend to find more success than men. A 2012 TD Economics report found the proportion of women planning on expanding their business is larger than that of men. Furthermore, small- and medium-sized businesses owned by women account for about $117 billion in economic activity in Canada. Today, the challenges for women entrepreneurs aren’t exactly what they used to be, says Leah Lawrence, chairwoman of the Calgary Chamber of Commerce and president of Clean Energy Capitalists, a small business. “I think my male colleagues struggle just as much as I do with the business side of things as far as finance: growth, cash flow and funding,” she says. “Those are all standard.” Many women are starting small businesses because they offer more freedom than climbing the corporate ladder of someone else’s business. “Many of the women entrepreneurs that I know have started a small business because they need to balance work-life a little more than they’re able to when they’re working for a larger firm,” Lawrence says. Indeed, some of those same challenges remain. Although there’s certainly more equality in the household, the burden of caring for children, aging parents, preparing dinners and household chores still often tilts more toward women’s responsibility even though they’re usually working full-time, too. “Those expectations are still very real,” says Van Camp. And for some, running a small business — especially a successful one — often does make balancing home life and work even more challenging. Yet many more women are able to build their business with support from their families. “I can also say personally that I couldn’t do what I do in a day without the husband that I have supporting me,” Makar says. “When he sees the benefits that come back to our family and the role model that I am to our children, he’s willing to support in whatever way he can so that we can do all we want to as a family.” What is needed, however, is the opportunity to learn and network, and a local chamber of commerce can help in that regard, Lawrence says. “As you get involved with it, you start to grow your understanding of the broader business community,” she says. “The Calgary Chamber of Commerce has especially been a passion of mine because it’s a place where I can understand the broader business concepts, as well as learn from those around me.” But having a place of their own where women can meet — like Calgary Business Women Network — is arguably even more helpful, especially for fledgling entrepreneurs, Makar says. “Women network differently than men,” she says. “For us, it’s building that commonality and that trust between us.” Support from your peer group is essential because it helps inspire a new generation of female entrepreneurs. “It’s the idea that, ‘The women before me have done it, so I can do it, too,’ and there have been a lot of good female role models who have been super successful,” Van Camp says. But fledgling entrepreneurs also need to be unwavering in their pursuit of their goal if they want to be successful in the long-term — man or woman, Lawrence says. “You have to be prepared that some days the business will be really successful and sometimes it won’t,” she says. “The big question is can you make it through the tough times, and can the people around you support you along the way?” networking ‘feeds Your soul,’ sAYs femAle entrepreneur
financial institutions,” he says. “The portion of small business owners who are not borrowing need their banking services to be as convenient as possible.” Credit unions offer the same banking services as chartered institutions and they’re required to maintain the same standards. “In Manitoba, credit unions have 30% of the market share of the entire market. We’re a very strong force,” Lund says. “When small business owners come into a credit union, they get somebody who listens to their story and believes in them. The first thing we think when a member walks in the door is, ‘How can we help this person?’ ” Since credit unions are local companies, they have local decision-making power and can focus on their own market without worrying about what’s happening in other markets across Canada. “In smaller markets, we may know the person coming in who needs our help,” Lund says. “Local decision-making power gives us more ability to help our members. All financial institutions want to help the people they do business with. We just have a different definition of what people we can help and how we can help them.” Helping small businesses is also good business for financial institutions, and Lund says they’re treated with the same respect as large companies. “Every business was once a small business. If you’re not helping small businesses, you’re just hurting yourself,” he says. “Customers and members tend to be loyal, and if you help them when they need help, they’re not going to forget that.”
By Holli Moncrieff For the Free Press B anks and credit unions offer many services to help small businesses succeed, and one of the most valuable services is free. “A lot of these business owners need advice,” says John Lund, corporate lending manager for Steinbach Credit Union. “They’re busy running their businesses; they’re not financial experts. Small business owners should take the time to sit down and talk to one of their credit union’s financial advisors,” Lund says. “It’s one more voice and it’s free. Good, free advice is something people should take advantage of. We have experienced people working for us who have seen almost every scenario.” Personalized, professional advice can make a big difference in the life of an overwhelmed entrepreneur. “Since small businesses owners have to wear so many hats — they are the finance department, payroll department and human resources department — it’s difficult for them to stay on top of everything,” Lund says. “Small businesses don’t have as much capital and they don’t have as much access to capital as larger companies. They may just be starting out, or trying to grow from one level to another.” While some small business owners do require start-up and operating capital, Lund says they’re a minority. “A lot of people have this impression that every small business is in need of capital, but most small businesses are not borrowing. Significantly more than half of small businesses are not borrowing from
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SMALL BUSINESS MONTH - SUppLEMENT TO THE WINNIpEg FrEE prESS - WEdNESdAy, OcTOBEr 22, 2014
Small buSineSSeS caShing in on better newS
for business. Saskatchewan is also performing strongly, although the agricultural sector there has suffered somewhat from flooding. British Columbia continues to show an impressive rebound, Mallett says. “We’ve seen that for some time. It’s been the most optimistic business environment in the country because of the more stable policy environment. That’s a big change from 2012, when it was underperforming in that respect.” Ontario and Quebec, on the other hand, continue to face policy uncertainties and fiscal challenges, he says. “There is no free money for governments to be spending on fiscal stimulus. Large debts have to be paid.” Eastern Canada’s economic challenges have not changed, as populations are aging and in some cases decreasing, which affects asset value and spending habits. The exception is Newfoundland and Labrador as a result of its oil and gas activities. The primary reason for the general optimism is the strengthening U.S. economy, says Howard E. Johnson, president of M&A International in Toronto. “Expectations are that that it will remain that way for the next 12 to 18 months.” He says many businesses servicing booming industries, such as oil and gas, are faring extremely well and becoming primary acquisition targets for
buyers. “We’re also seeing an increasing interest in succession planning as baby boomers start to retire, which can present challenges for business owners if they wait too late to start the process.” As a banker for more than three decades, John Roberts, vice-president of small business with Scotiabank in Toronto, believes these are very exciting times for small business. “I can’t imagine another time where there has been as much emphasis and focus on small business.” He notes that 2014 did start slower than expected. “Businesses across the country took a hit with the winter weather, but we’ve seen some very strong months of activity from May onward. The dollar rate has been great for manufacturers and exporters, and borrowing rates continue to be low.” He says for the most part in 2013, businesses were using their cash reserves. “We didn’t see the lending side rise. Rather businesses were self-funding. But there has been a spike in lending in 2014, which indicates increased confidence.” Bank of Montreal recently issued its latest business confidence report that confirms small business owners’ moods are on the upswing. The results show a three-point increase (from 65 to 68 out of 100) in confidence from earlier in the year. Fifty-nine per cent of owners also believe that 2015 will be a better year for business.
Denise Deveau Financial Post A s 2014 winds down, small businesses are feeling a renewed sense of cautious optimism. Ted Mallett, vice-president and chief economist for the Canadian Federation of Independent Business says small business tends to go where the economy goes and vice versa. “They are both leaders and followers in the economic cycle of things.” The most recent CFIB studies are showing growth is returning and optimism is rebounding, barring a slight “hiccup” in late 2013 and early 2014. “That was likely related to the weather, which made it hard for many operations,” Mallett said. “There were a few climate-related difficulties. The flooding on the Prairies, for example, tempered the agricultural outlook for many members.” These fears have subsided as businesses are getting back to normal, he says. “It’s not quite back to its potential level because we are still recovering from the shock of five years ago.” Sectors and regions continue to perform on the same trajectory as in previous years, for the most part. The booming Alberta economy is still creating capacity challenges and labour shortages
Grocers do the cookinG to lure in shoppers
Bill Mah Postmedia News
When Dave Hare opened the IGA in Tofield, Alta., 35 years ago, he went head to head with three rival grocers. These days, it’s the restaurants in town that are his main competition. Consumers’ growing appetite for eating out means fewer home-cooked meals, which means they’re buying fewer groceries to stock their fridges and pantries. But grocery retailers have turned the tables on restaurants by offering to do the cooking. A recent Tofield IGA weekly flyer featured layered dips, ready-made salads and trays of cold cuts and sausage rings for Thanksgiving. “People are time-starved,” Hare said. “The husband and wife both work, they’ve got a couple of kids with one going to dance and the other to hockey or football and they have to prepare a Thanksgiving dinner. So they’re coming to us for most of it already prepared.” According to Statistics Canada, Albertans spent $8.5 billon at restaurants and bars in the 12 months leading up to July. That’s an increase of 6.6 per cent over the previous 12 months, notes ATB Financial senior economist Todd Hirsch. “This growth is above the rate of Alberta’s population growth (2.8 per cent) plus annual price inflation of restaurant food (also 2.8 per cent),” Hirsch said. Tom Barlow, president and CEO of the Canadian Federation of Independent Grocers, said the phenomenon called “home meal replacement” was a big topic of discussion at its recent conference. “We’re seeing this trend where consumers are now eating out more than they are making meals at home,” Barlow said. “So for the grocery sector to compete, they’ve got to be able to get a piece of that market.” Some grocery retailers have hired on-site executive chefs and others offer full hot bars filled with dishes like curry chicken and sea bass. “In a lot of cases, their cost to operate is a lot lower than a restaurant,” Barlow said. “They’ve already got the infrastructure in place and it’s a great way to use their own ingredients in the store.” For Hare, whose supermarket just won the grocers’ association’s Arnold Rands Heritage Award for best privately owned multi-generational store, he remembers when many supermarkets didn’t even have an in-store bakery, let alone a deli. They carried grocery, meat and produce and that was it. Now, he has a deli that prepares special meals that change every day. “We do sell lots of ham sandwiches, we make our in-store pizza, we got rotisserie chicken. You build from those things lots of in-store meals.” Grocers are even doing more of the prep work for their customers, chopping up fruit and vegetables, for example. “Our cut fruit has exploded,” Hare said. “I’ve even had comments from the seniors in town who say they love that because they can’t cut watermelons because they don’t have the strength, and do they want a nine- pound watermelon?” Hare is planning to almost double the size of the store over the next two years, and his deli and bakery will both be expanded. That will mean half the store’s retail space will be devoted to prepared fresh foods, meat and produce, while the other half sells non-fresh groceries. “In the old days, I probably would have had 15 per cent fresh.”
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SMALL BUSINESS MONTH - SUppLEMENT TO THE WINNIpEg FrEE prESS - WEdNESdAy, OcTOBEr 22, 2014
Prairie small business shines
Creative director for Farmfresh Ben Lamothe describes the various features of their sunglasses at Spare Parts inSaskatoon. Photo by Richard Marjan
With Quality, ‘Heritage-Inspired Products’
meant to be passed down from one generation to another and they get better over time. “Farmfresh means quality, heritage-inspired products, the kind our grandfathers would have made in Saskatchewan. It has a bit of the pioneering spirit to it ... the kind of product you would be proud to pass on to your son or daughter as time goes on.” Being from the middle of the Prairies may seem like a disadvantage to some, but Mysak said being from Saskatchewan
and Farmfresh sunglasses are one of the top three brands, being outsold only by Oakley and Ray Ban. “People like the story that it is from Saskatchewan and it is made by local designers,” Lamothe said. “We embrace our Saskatchewan roots and that spirit.” When it comes to marketing, the company has to find creative ways to get the word out. For example, it has been involved with setting up a pop-up store
Scott Larson Postmedia News A s a small business that’s competing head to head with international companies with multimillion-dollar budgets, one has to carve out a unique space in the market. For Saskatoon-based Spareparts, one way to compete is to create a brand of products that are on par or superior to the high-end competitors’ products. Enter Farmfresh, founded in 2012 by Spareparts president and founder Danny Mysak, which offers “timeless, prairie-hardiness- inspired, pass-them-down-from-generation-to-generation” pieces such as watches, sunglasses, vintage soft leather briefcases and wallets. “There is a craving to have your own house brand and to do something on your own,” said Spareparts/Farmfresh creative director Ben Lamothe. “There is a benefit financially, but also it separates yourself from everyone else. “This puts us in a position where we have something unique for our customer.” Spareparts has grown to seven stores — two stores in Calgary, two in Winnipeg and one each in Regina, Saskatoon and Kelowna, B.C. “Basically (we sell) everything that you would wear that is not clothing — luggage, watches, sunglasses, backpacks, women’s fashion bags, men’s messengers, footwear, underwear, cellphone cases — all of your spare parts,” Lamothe said. He said Farmfresh products are designed in-house and use the best materials, such as hand-crafted Italian acetate for the sunglass frames along with Zeiss polarized lenses, Japanese Miyota movement in the watches and Texas full-grain leather for the bags. “(The bags) come with a 100-year warranty,” he said. “They are
“Artisans are making a big comeback,” he said. “There is a real movement toward quality products that are built in small batches by local people.”
means access to a great resource — its people. “Agriculture, potash and uranium are commodities,” Mysak said, “Saskatchewan’s greatest resource is its people. They are an immediate and apparent asset to any business considering our province. “Truth be told, the advantages far outweigh the challenges,” he said. “Saskatchewan has a spirit of enterprise and collaboration. Building a brand is not an insular pursuit and while Spareparts possessed many of the resources necessary to do so, Saskatchewan definitely filled in the gaps in our capabilities.” Lamothe said since the economic crash of 2008 people have become somewhat cynical of big business. “Artisans are making a big comeback,” he said. “There is a real movement toward quality products that are built in small batches by local people.” The brand has done well — Farmfresh wallets are the top- selling wallet in the store, outselling Nixon and Fossil brands,
and it has identified local people who possess the same qualities as the brand. “We call them Citizens of Common Kin,” Lamothe said. “The strategy is to get it on people with influence in the market, those people that are well-respected and the kind of person that are hard- working and humble.” They are artisans and musicians, and even a cool barber. This small collective of people have become ambassadors of the brand. “You don’t just buy a billboard and hope for the best,” he said. “When you are local and small you really have to be creative in how you market yourself.” The goals now are to expand the market by doubling the number of Spareparts stores over the next two to three years, to have clients go online at a recently launched website and to offer the Farmfresh brand in 20 non-Spareparts shops across the country. “It doesn’t matter where you are from anymore,” he said. “They are drawn to people who are doing something that is unique.”
Dan Barnes for Postmedia News E dmonton — The combination of China’s unrivalled thirst for beer and the beneficial local knowledge of a joint venture partner convinced P.J. L’Heureux to tap into the world’s largest market. The founder and president of Craft Beer Market, a three-restaurant chain based in Calgary, announced in early October that the company will open five restaurants in five years in China, starting with a Shanghai location in 2015. It’s a joint venture with First Growth Holdings of Vancouver, which has an office in Shanghai. “China is not a place where you can go and just open the doors. We couldn’t just go and open a location,” L’Heureux said. “We needed a partner in the market and we’ve got a very strong one so we feel very good about it.” Craft’s locations in Vancouver, Calgary and Edmonton are sized at 10,000 square feet and have room for 350 patrons. The kitchen serves up inspired pub food with a focus on local ingredients, but with more than 100 beers on tap, brew obviously fuels the bottom line. China has been the world’s largest consumer of beer by volume since 2002 and sales reached 500 million hectolitres in 2011. According to Beer Canada, in 2013, Canadians bought 22.6 million hectolitres. By 2017 China will also be the largest market by value for suds, according to EuroMonitor International. The most popular brand in China, by far, is Snow, produced by the leading brewery, China Resources. Tsingtao, Yanjing, Harbin and Laoshan round out the top five brands, while Tsingtao Brewery, Anheuser-Busch InBev, Beijing Yanjing and Carlsberg fall in line behind China Resources in terms of sales. “Quite honestly, the numbers are unbelievable,” L’Heureux said. crAFTy MOvE TO cHINA FOr ALBErTA-BASEd rESTAUrANT cHAIN
Your Entrepreneurial Journey Begins Here
“The growth is unbelievable in that market so we feel it’s a well- calculated risk.” L’Heureux said company executives had not been considering a move outside Canada before First Growth came to them with the proposal. But he was immediately intrigued, and subsequent market research, including a visit to Shanghai, set the deal in motion. Shanghai boasts 24 million residents, while a further 100 million live within an hour’s drive. It is home to several popular craft breweries, and European brews are also doing well in the market. He believes the Chinese palate for beer rivals that of the West Coast, where craft breweries have taken flight. In 2013, Russell Brewing of Surrey partnered with a Chinese company to open a test brewery in Hefei, a city of 5.7 million people in an eastern province. “There’s quite a few Canadians or expats who have done very well in the (Asian) market,” L’Heureux said. “The craft beer scene in all of Asia is growing at such a rate and the population base is so high, even if you’re doing slightly well, you’re doing better than some of the breweries out here.” Despite this offshore deal, Craft’s growth strategy is unchanged, limited to one new location per year in Western Canada, with particular emphasis on adding second restaurants in Calgary and Vancouver. And L’Heureux said the restaurants’ food menu won’t change overseas either. “The Chinese public is really interested in North American brands. Companies like Starbucks and Burger King and KFC are doing really well because that’s what the Chinese people want. They want burgers, flat breads and pastas.”
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
Craft Beer Market founder PJ L’Heureux in his Edmonton restaurant. They are expanding to China. Photo by Shaughn Butts
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SMALL BUSINESS MONTH - SUppLEMENT TO THE WINNIpEg FrEE prESS - WEdNESdAy, OcTOBEr 22, 2014
Banking on Boomers W e all know Canada’s population is aging. But how will changing demographics affect your business? First, the good news. Aging consumers have different buying habits, so that means opportunities if you’re creative. The bad news is that as baby boomers retire, many businesses will face labour shortages because not enough younger workers will be around to take their place. Either way, businesses that don’t adapt to the reality of the aging population could face severe challenges and are going to miss opportunities, says Pierre Cléroux, chief economist at the Business Development Bank of Canada (BDC). The impacts are already being felt in some sectors and regions where businesses are struggling to find younger employees to replace retiring boomers. “If we don’t manage our labour force according to the new trends, it’s going to be difficult for businesses to be successful,” Cléroux says. In the next 20 years, the median age of Canadians is expected to rise to 45, up from 26 in 1991, Statistics Canada projects. Twenty years ago, nearly two people entered the labour force for every person nearing retirement. Today, the ratio is one to one, and it is expected to drop further. Happily, Cléroux says entrepreneurs can take steps to adapt — and even find opportunities by reviewing how to adapt products and services to an older consumer’s needs. “Every sector of the economy is going to be impacted,” Cléroux says. To deal with the coming labour crunch, you can start by creating more accommodating workplaces to entice aging employees to put off retirement, he suggests. Older workers often can’t or don’t want to work full-time. Flexible hours, part-time jobs and temporary work are ways to keep them on board. Some companies also deliberately recruit seniors to fill labour gaps. “Older workers usually have a great work ethic and experience,” Cléroux says. “Businesses will need to keep their people working for them longer. The perception is that at 65 people are done. That perception will have to change.” Les MacIntyre is a firm believer in retaining older employees to make up for a shortage of younger workers at his company, Superport Marine Services. He has no mandatory retirement age and offers retirees flexible, part-time and temporary jobs. He also pairs them with younger workers to pass on skills. “Those guys pick up a wealth of expertise. The retired guys have the patience to pass on that knowledge. They bring a lifetime of skill,” he says. MacIntyre also works hard to foster a positive workplace culture so retirees are eager to come back. “I try to instill a stimulating and satisfying workplace so they enjoy working here and I have a high retention rate.” — Business Development Bank of Canada
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SMALL BUSINESS MONTH - SUppLEMENT TO THE WINNIpEg FrEE prESS - WEdNESdAy, OcTOBEr 22, 2014
1. A little soul seArching: The first step is to have a clear idea of why you want to start a small business. While that sounds elementary, Sawatzky says people want to start businesses for a lot of reasons, but not all of them are necessarily good ones. “Some people start businesses for necessity because they need the money. Others start it for a lifestyle, thinking it’d be pretty nice to not have a boss.” But these shouldn’t be the primary drivers behind your decision because starting a small business often costs money, involves a lot of added responsibility and very long hours. Perhaps, the best reason for launching a small business is that it is your passion, because it’s that fire in your belly that will help you overcome the many challenges you’ll likely face. 2. reseArch, OK, so you know you want to start a small business, and you’ve got a good reason to do so. But does it make good business sense? Is there a market for your idea? To answer these questions, you need to do some homework. “This is about determining the feasibility of your idea,” he says. “Some people look around and find a problem that a lot of people share and then try to find a product or service that solves that problem.” It also helps to keep abreast of current events and trends so you can find a niche in the market. Look to organizations like the Business Link that can provide resources and expertise to help with your market research. 3. PlAn for success: All that aforementioned research will come in useful when you write a business plan, which is essential. Sawatzky says some people start businesses without them, but it’s hard to imagine a venture flourishing in the long run without a business plan. “This speaks to that old axiom of failing to plan is planning to fail,” he says. “A business plan is really a road map to your business and helps you navigate the startup process.” Furthermore, if you need money from investors — like a bank loan — they’re not going to hand over any money unless you’ve got a plan that shows them how you’re going to make money to pay them back. “Anybody who wants to invest in your business is actually going to want to see that you’ve done the due diligence,” he says. 4. show me the money: reseArch, reseArch: Starting a business is generally capital intensive. Fledgling businesses often need money to live and grow while building a customer base on the way to profitability. Of course, the first place to look is your own wallet. Having the savings yourself eases the burden of seeking loans from others. But usually that’s not enough, so you will need other sources. You can go the traditional route, seeking a bank loan, or have friends and family chip in some cash. Crowdfunding, angel investors or venture capitalists (like TV’s Dragons’ Den) are other ways to secure cash for your startup. “But there are also alternative financing options out there,” including non-profits such as Community Futures and Futurpreneur Canada that provide grants and loans to niche market entrepreneurs, Sawatzky says. 5. helP needed: Being an entrepreneur may be an individualist enterprise. You are, after all, becoming your own boss, but that doesn’t mean you want to do it all on your own. You will need the help of experts to get up and running, and that’s where organizations like the Business Link can help. “You need to find the resources that are out there to help you overcome those unexpected challenges,” Sawatzky says. “Within those organizations there are resources, referrals, training and networking opportunities.” It’s also a good idea to seek out a business mentor, a friend or someone in the community who has successfully run a small business. But the need for advice goes beyond the startup phase; it is ongoing, Sawatzky says. “Once you’ve made some dollars there are professional services out there as well, like accountants and lawyers.”
for would-be entrePreneurs must-do tips
Joel Schlesinger for Postmedia News
Tired of working for the man? Thinking about making the transition from wage slave to master of your own entrepreneurial destiny? B ecoming an entrepreneur is one of the most rewarding, and most difficult, endeavours a person can pursue, says Gord Sawatzky, the executive director of The Business Link, a federal and provincial government organization that provides support to Alberta entrepreneurs. Here are five must-dos to help you achieve small business success.
Every small business comes with a big story. Tell us yours.
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