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2022 Federal Budget Misses the Mark for Retailers in Canada: Interviews

By
Mario Toneguzzi
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Parliament Hill in Ottawa

The 2022 federal budget, announced on Thursday, was a missed opportunity to help small businesses recover from COVID, says the President and CEO of the Canadian Federation of Independent Business. 

Dan Kelly said the budget ends all COVID supports, including the Hiring Program which was meant to help small firms rebuild their workforce in the recovery phase. The national organization said it is disappointed the budget doesn’t include measures to help small businesses’ post-pandemic recovery. Small businesses continue to struggle after an extremely difficult two years and now face a host of higher costs and a mountain of COVID-related debt.

Dan Kelly

“The federal budget ends all COVID support programs, including the Canada Recovery Hiring Program, which was meant to help small firms rebuild their workforce in the post-COVID recovery phase. The budget was a missed opportunity to help small firms now facing massive cost increases on virtually every line of their own budgets, including payroll and carbon taxes. It also doesn’t help the two thirds of businesses (67 per cent) that were forced to take on COVID-related debt, at an average of $158,000 per business,” said Kelly. “CFIB will continue to advocate for a small business hiring incentive and 50 per cent forgiveness of Canada Emergency Business Account (CEBA) loans.”

The CFIB said the budget includes billions in new spending and deficits as far as the eye can see. Small businesses know that today’s deficits mean more taxes for them down the road. A plan to move more quickly to balance the budget remains a priority for small business owners, it said.

“April 1 saw an increase in carbon taxes, adding further unfairness to a tax regime that collects hundreds of millions from small businesses while returning next to nothing to them in rebates. Fuel and energy costs were viewed as the single biggest cost challenge facing small business and a process to return these desperately needed dollars to small businesses has yet to be created,” said the national organization.

“At a time when many small firms are struggling to make payroll, the budget confirms workers and employers will see another significant increase in both Employment Insurance (EI) and CPP/QPP premiums. And with potentially costly changes planned for the EI system, small firms are rightly worried about many years of payroll tax hikes ahead,” added Kelly.

On a positive note, the CFIB said it was pleased the budget allows more firms access to the nine per cent small business tax rate on the first $500,000 in corporate income. Instead of losing access at $15 million in taxable capital, firms with up to $50 million will be able to benefit.

“We congratulate the government for accepting CFIB’s long-standing recommendation to raise this threshold to $50 million, encouraging more small firms to grow to medium-sized. We are also encouraged by the planned review of rollover provisions for small business investments,” said Kelly.

Michelle Wasylyshen

Michelle Wasylyshen, National Spokeswoman for the Retail Council of Canada, said the federal government’s 2022 budget contained some good news measures for retailers, most notably the adjustments to the Temporary Foreign Workers Program (TFWP), announced earlier in the week, to help businesses address labour shortage issues. 

“Retail is Canada’s largest private-sector employer and our members have had to cope with a significant loss of experienced staff throughout the pandemic as employees needed to find work in other industries when stores and malls remained closed or operated at a limited capacity for prolonged periods of time,” she said.

“We are seeing signs of economic recovery in our sector, but things remain fragile, with inflation rates the highest they’ve been in over 30 years, the recurring threat of new COVID variants, leading to changes in work and spending patterns, and the recent instability arising from blockades and occupations of border points and urban centres. As such, we are disappointed to see limited movement on the many ideas we put forward during the past two years, as they would have helped ensure the recovery of Canada’s retail industry, boost Canada’s economic growth and make life more affordable for Canadian families.

“Of these, RCC was most hopeful that the government would take action on credit card swipe fees for our small businesses which, we estimate, are costing merchants $10 billion a year. These costs will only be further multiplied with rising inflation rates coupled with the declining use of cash and rise in online shopping. We also called for the elimination of tariffs on essential items Canadians use every day, such as clothing, shoes, and baby items which translates into around $5 billion in hidden taxes for Canadians each year, unnecessarily adding to their cost of living.”

Honourable Perrin Beatty

Perrin Beatty, President and CEO of the Canadian Chamber of Commerce, said Canadian businesses have faced an unprecedented two years, characterized by a multi-wave pandemic, inflation that has reached a 30-year high, supply chain disruptions, extreme weather events, and geopolitical turmoil. Given these conditions, it has never been more important for the federal government to focus on economic growth. 

“This economic growth must be private sector-led. While our public finances have benefitted from higher inflation rates and energy prices and low interest rates, we cannot borrow or inflate our way to prosperity. Federal spending needs to be both fiscally responsible and targeted at where it can generate genuine economic returns. Generating economic growth requires carefully using all the tools available, including tax, regulatory, labour, and infrastructure policy, to attract private sector investment,” he said.   

“The government has set out an ambitious agenda in Budget 2022. It now will be essential to work collaboratively with businesses to ensure measures announced are implemented in a manner that will support economic growth.”

The Chamber outlined the following measures it welcomed from the budget for Canadian businesses: 

  • The gradual phase out of the small business tax rate when taxable capital reaches $50 million instead of $15 million;
  • Investments in the critical minerals industry to support the full development of supply chains, from extraction through to processing and recycling;
  • Various measures to support the net zero transition, including the introduction of a tax credit for carbon capture, utilization, and storage, incentives for Zero Emissions Vehicles, and investment tax credits for net zero technologies;
  • Funding towards a trusted employer program for Temporary Foreign Workers that will address labour shortages; and
  • Support for exploiting the opportunities from the legal cannabis sector.

 But the Chamber also noted the following that will “undermine” much-needed economic investment and growth:

  • The absence of debt relief for businesses that used government support programs such as the Canada Emergency Business Account;
  • A lack of focus on cybersecurity supports directly for the private sector; and 
  • Only a partial review of the tax system rather than a comprehensive review, particularly given the implementation of additional measures on a sector basis for financial institutions and digital services.

“The gap between Canada’s potential and our performance continues to grow. It has never been more important for the government to view Canadian businesses as a partner, and not as a problem. Our competitors are squarely focused on how to attract investment and growth. That needs to be our top priority, too,” said Beatty.

The Canadian Taxpayers Federation criticized the budget announced by Finance Minister Chrystia Freeland for failing to provide a plan to balance the budget and rein in spending.

“Freeland is giving taxpayers another credit card budget with no plan to pay the bills on time and chip away at the $1-trillion debt,” said Franco Terrazzano, Federal Director of the CTF. “Freeland is taking the wait-and-see approach to the government’s credit card bills and hoping the economy can grow faster than its borrowing, but that’s not a good bet with its track record of runaway spending.”

Franco Terrazzano

The CTF said the federal deficit is expected to be $52.8 billion this year and Budget 2022 does not include a plan to balance the books.

“The debt is projected at $1.2 trillion by the end of the fiscal year. Budget 2022 is adding another $148 billion to the debt by 2027. At 45.1 per cent, the 2022 debt to GDP ratio remains higher than pre-pandemic levels, which were close to 30 per cent,” explained the Federation.

“The federal government’s spending is projected to be $452.3 billion this year, which is $89.4 billion above pre-pandemic spending in 2019. The federal government’s spending was at all-time highs before the pandemic. Interest on the debt is projected to cost taxpayers $26.9 billion this year.”

Retailers Rank Highly on List of Canada’s Most Reputable Companies: Leger Study

By
Mario Toneguzzi
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CF Toronto Eaton Centre (Photo: Dustin Fuhs)

Shoppers Drug Mart is Canada’s most reputable company, according to the 25th Annual Reputation Study by Leger, and the Toronto Raptors is Canada’s most reputable professional sports team.

Leger, the largest Canadian-owned market research and analytics company, with more than 600 employees in eight Canadian and US offices, surveyed more than 38,000 Canadians to explore their perspectives on more than 285 companies in 30 different sectors. In 2022, a new sector was added—professional sports teams. 

Collectively, Canadian companies are experiencing a reputation crisis, and how they will respond is yet to be seen, said the report.

David Scholz

Dave Scholz, Executive Vice-President, Leger, said overall reputation scores have dropped again this year after two years of uncertainty and change through the COVID-19 pandemic.

“The industries hardest hit are breweries, drugstores, hospitality and bookstores. Shoppers Drug Mart is the most reputable company this year; however, their score is down five points from the year before,” he said.

“The industries with the largest growth in reputation are the industrial category and the insurance industry. The industrial category’s reputation increase is driven by Boeing’s resurgence/recovery . . .  The insurance industry’s growth is broader, with four companies showing substantial reputation score increases this year: Canada Life, The Co-operators, Wawanesa and CAA.

Shoppers Drug Mart at Tsawwassen Mills in Delta, BC (December 2021). Photo: Lee Rivett.
Shoppers Drug Mart at Tsawwassen Mills in Delta, BC (December 2021). Photo: Lee Rivett.

“We saw no overall increase or decrease in reputation score over the past year in the pharmaceutical category, but we saw significant movement within the category. Pfizer’s reputation score shot up by 10 points in the past year, while Astra Zeneca’s decreased by seven points, showing the impact of the COVID-19 vaccines and how the ongoing discussion has shaped perceptions of these two companies.”

This year, the top 10 most reputable companies have an average score of 71 out of 100, with the highest scores (Shoppers Drug Mart and Sony) at 73. Ten years ago, the average score for the top 10 list was 83, with Google in the highest spot at 91. This is a 12-point average score drop in a decade.

“With overall reputation scores dropping so significantly, you would expect that more Canadians have a bad opinion of these companies. In reality, bad opinion ratings have not changed on average. Rather, we are seeing a drop in good opinion ratings and an increase in the percentage of Canadians who say they “know the company but not well enough to rate it”,” said Scholz.

“This mirrors the change in reputation we see when a company goes through a crisis. Canadians don’t flip flop between good and bad opinions; rather, we allow companies a grace period in which we are waiting to see what they will do next. Collectively, Canadian companies are experiencing a reputation crisis, and we are waiting to see how they will respond.

The challenge for companies will be to learn as much as they can about their stakeholders’ perceptions of them and look for ways to rebuild the relationships that have led to this decline. Canadians are open to feeling positive again, but what organizations do next will affect if these one-time positive perceptions can be rekindled.”

The Top 10 Most Reputable Companies in Canada in 2022 are:

1. Shoppers Drug Mart (Reputation Score: 73)

2. Sony (Reputation Score: 73)

3. Samsung (Reputation Score: 72)

4. Canadian Tire (Reputation Score: 71)

5. Interac (Reputation Score: 71)

6. Google (Reputation Score: 70)

7. Campbell (Reputation Score: 70)

8. Microsoft (Reputation Score: 69)

9. A&W (Reputation Score: 69)

10. Netflix (Reputation Score: 69)

Scholz said even the companies at the top of the list are not scoring as well as they used to 10 years ago. It was not uncommon when Leger first started this study to see scores in the 90s. It’s very uncommon to see that now.

“The interesting thing is that it’s modeling, or mirroring, what we see when an organization has a reputational crisis . . . If we have respect for an organization and we have trust in that organization, we’re willing to let them show us what they can do. And that’s what we’re seeing in the reputation scores. We’re not seeing people going from a good opinion to a bad opinion. We’re seeing people going to this holding pattern,” said Scholz. 

“It’s not that they have a bad reputation but they need to re-engage with people. Think about it in relationship terms. We’ve had a bit of a timeout and now we need to figure out how to get back together and feel good about each other again. If you’re in that holding pattern for a long enough time where you don’t know if they’re good or bad, it’s easier to build up bad perceptions or it’s easier to become complacent about that relationship. If I’m an organization I want to have a strong reputation, I want to be engaging with my stakeholders, I want to be creating that relationship with them and I want them to be feeling good about me. 

“That’s why we say they’re in crisis because people are starting to slip and they need to not be complacent about this. There needs to be some activity or actions, depending on the organization, and they need to listen to their customers and stakeholders and ask them why they are feeling this way. They need to go for couples’ counselling.”

Scholz said people are more likely to frequent a business and buy products from them if they have a good reputation. People are also more likely to want to work there. 

“I’m also more likely that if I have a problem with the product or with the service, to forgive you and come back again if you have a good reputation. From a larger perspective, when you start looking at where you’re going to be building new locations or where you’re going to be putting your organization, you want to get approvals, you want to go through that red tape process that retailers have to go through, it’s better if you have a solid reputation or easier if you have a solid reputation than if you don’t,” he said.

The Top 10 Most Reputable Professional Sports Teams in Canada in 2022 are:

1. Toronto Raptors (Reputation Score: 59)

2. Toronto Blue Jays (Reputation Score: 57)

3. Winnipeg Jets (Reputation Score: 55)

4. Montreal Alouettes (Reputation Score: 51)

5. Calgary Stampeders (Reputation Score: 50)

6. Toronto Maple Leafs (Reputation Score: 48)

7. Calgary Flames (Reputation Score: 47)

8. Edmonton Oilers (Reputation Score: 46)

9. Vancouver Canucks (Reputation Score: 46)

10. Winnipeg Blue Bombers (Reputation Score: 45)

The Top 10 Most Reputable Airports in Canada are:

Image: McArthurGlen Designer Outlet

1. Vancouver International Airport (YVR) (Reputation Score: 71)

2. Halifax Stanfield International Airport (YHZ) (Reputation Score: 65)

3. YUL Montréal-Trudeau International Airport (Reputation Score: 64)

4. Toronto Pearson International Airport (YYZ) (Reputation Score: 59)

5. Calgary International Airport (YYC) (Reputation Score: 55)

6. Winnipeg International Airport (YWG) (Reputation Score: 48)

7. Edmonton International Airport (YEG) (Reputation Score: 40)

8. Billy Bishop Toronto City Airport (YTO) (Reputation Score: 31)

9. Abbotsford International Airport (YXX) (Reputation Score: 25)

10. Jean Lesage International Airport (YQB) (Reputation Score: 25)

Canadian Retail News From Around The Web For April 8th, 2022

By
Retail Insider
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Canadian Retail News From Around The Web

News at a Glance

Retail Insider is streamlining its Canadian retail news from around the web to include a handful of top news stories that can be viewed quickly during the day. Here are the top stories from the past 24 hours.

Canadian Retail News From Around The Web For April 7th, 2022

By
Retail Insider
-
Canadian Retail News From Around The Web

News at a Glance

Retail Insider is streamlining its Canadian retail news from around the web to include a handful of top news stories that can be viewed quickly during the day. Here are the top stories from the past 24 hours.

Canadian Yoga-Focused Lifestyle Brand Lolë Returns with New Strategy After Shutting Stores in 2020: Interview

By
Mario Toneguzzi
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Lole Toronto Pearson - Terminal 1

Montreal-based Lolë, an active lifestyle brand, is poised for growth as the retailer rebounds following the closure of 30 stores in May 2020 due to the pandemic.

Nadine Garneau

Recently, it announced a partnership with Tandem West Sales to grow the brand in Western Canada and Lolë is also opening its second store in Canada in the near future in Bromont, Quebec to complement its flagship location on Sainte-Catherine Street in Montreal.

Nadine Garneau, VP of Sales at Lolë, said Tandem West Sales will represent the brand in British Columbia and Alberta to meet the growing demand for the company in Western Canada.

“They’re an agency. Basically, Western Canada is a focus for us. The brand was born in Quebec and has always been really well covered in Eastern Canada. We have a great wholesale presence. We have two outstanding reps in Quebec, and we also enjoyed really strong partnerships over the years with accounts like Sports Experts, Hudson’s Bay, Altitude Sports, Simons,” said Garneau.

Exterior of Lolë concept store on Rue Sainte-Catherine. Photo: Lolë
Exterior of Lolë store on Rue Sainte-Catherine in Montreal. Photo: Lolë

“The business is well-established here and we decided last year that basically we wanted to invest in Western Canada’s wholesale market and build a presence there. Tandem West Sales have a huge experience in our segment. They understand our consumers. They understand the product and basically share the same values as a company. We’re super excited to have them on board.

“We’re hoping to expand in boutiques, in outdoor active lifestyle stores. To grow and expand and cover that region that’s not being serviced properly right now. We were still servicing it internally but it’s hard when you don’t have a presence specifically there to service the customers in the right way.”

Lolë clothing can be found at more than 1,500 retail outlets around the world, in Lolë Ateliers and online at www.lolelife.com.

Last fall, Lolë announced the appointment of Rob French as the brand’s new vice president of digital omni-commerce. The company said French would be leading efforts in consumer insights, testing supply chain-to-consumer models, improving online customer journeys, sustaining and growing Lolë’s retail brand, and more.

In the fall of 2020, it reopened its store on the iconic Rue Sainte-Catherine in Montreal after the COVID-19 pandemic forced the closure of all of its stores in May of 2020.

The retailer had to close its 31 stores (20 stores in Canada from Vancouver to Halifax, seven stores in the US, four stores in France) due to the financial challenges presented by the coronavirus. The company at that time had about 200 employees.

“The world has gone through a challenging time and so has Lolë,” said Todd Steele, CEO, at the time. “Our stores closed across the country and it was a heartbreaking time for our employees and the company overall.

“We’re excited to welcome our customers to a brand new and revamped space that will be safe, stylish and full of the Lolë essentials they’ve missed enjoying in a store environment since lockdown.

Image: Lole

“We closed our stores at the outset of the pandemic. We closed them globally and ultimately we went through a formal restructuring process where we exited the leases of those stores, we sold the assets of the company and re-started the company as Lolë Brands which is the new company name. This Sainte-Catherine opening will be essentially the first reopening of any retail we’ve had since the start of the pandemic.” 

The company was started about 30 years ago.

Garneau said the company’s goal is for increased distribution over the next year across North America.

“In the US, we’re also focused on increasing our distribution in the core and active markets and finding new advocates for our brand. We will also open two to three new retail stores in the next year as well – one in Canada and two in the US,” she said.

“And on the product side, we’re super excited so far with the 2022 line that we’re shipping. The product has been super well received. We’re looking to have more and more product as seasonless items, meaning that we would always have them in stock. This will really allow our wholesale partners to have a better ability to manage the inventory and to provide their customers with those items over and over again.

“The next five years I would say we’re hoping to get the Lolë awareness globally. Right now, the brand awareness is super strong in Canada, growing in the US and thanks to our Quebec roots we have a nice brand awareness also in France, but we would like to grow more in the rest of Europe and when the time is right we’ve also discussed growth in Asia. But before we get there we need to solidify our position here which is our main focus right now.”

The Delicate Balance Between Grocery Store Profit and Food Security: Op-Ed

By
Retail Insider
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Food prices in Canada continue to soar in the face of labour shortages, the rising cost of goods and supply chain disruptions. Statistics Canada recently reported that the food inflation rate in the country has reached 7.4 per cent and that it will most likely rise again in the coming months.

Last December, Canada’s Food Price Report 2022 forecast an overall increase in food prices in Canada of up to seven per cent, but there is a strong possibility that market disturbances related to the conflict in Ukraine could push prices even higher this year. This could cause trouble for grocery retailers that have become the epicentre of food price increases.

The general inflation rate is at its highest since 1991. This underpins serious concerns for food security as food, energy, gas and housing prices soar.

When faced with skyrocketing food prices, some shoppers understandably suspect retailers of greed and taking advantage of inflation to raise prices. Skepticism of the food industry will likely increase, yet we must be careful before judging too quickly.

Profits are smaller than you might think

At the Agri-food Analytics Lab, our research follows food prices closely. Every year, we predict which food categories will increase or decrease in value, and by how much. Generally, we get it right, but this year, food price inflation is set to surpass our predictions.

A comparison of the profit margins calculated from their respective annual reports published in 2021 for the big three retailers — Loblaws, Sobeys and Metro — against Canadian companies in other sectors shows us their financial results are rather modest. At the end of their respective fiscal years in 2021, profit margins were 3.7 per cent for Loblaws, 2.7 per cent for Empire/Sobeys and 4.5 per cent for Metro.

Certainly, these are interesting results; profits are indeed on the rise compared to pre-pandemic years, but these rates are still below the increased rate of food inflation. In other words, the performance of these chains has actually stagnated, if we compare it with the increased cost of living.

Profit margins in the food distribution sector are generally smaller than in other sectors. The profits of large Canadian companies in other industries far exceeded those of the major grocery chains. For example, in 2021, Enbridge’s profit margin reached 13.4 per cent and Telus’ was 9.8 per cent. In the banking sector, the profit margin of the Bank of Nova Scotia was 33.8 per cent — almost 10 times more than the largest food distributors.

Profit and food security

While the unease between profit and food security is not new, a company taking advantage of an inflationary windfall is still irresponsible and immoral. However, proving there is profiteering is virtually impossible, unless there is a confession like the 2017 announcement by Loblaws, admitting to having participating in bread price fixing.

With no real consequences imposed on participants, consumers are rightfully cynical, especially since the investigation by the Competition Bureau had not yielded much. In light of this scandal, the industry deserves its share of reproaches.

The balance between profits and social responsibility remains fragile in food, compared to other types of businesses. Nonetheless, if some people believe that our retailers are making too much money, then the question must be asked: what is the acceptable threshold of profitability in food distribution? One per cent? Three per cent? Five per cent?

How can we protect consumers?

In order to protect consumers, some refer to retail price regulation. This strategy already applies to a few products such as milk and beer, among others. However, state intervention for thousands of products would become a veritable bureaucratic and managerial nightmare, leading to high management costs that would end up being passed on to taxpayers.

In Canada, we have fairly well-run food retail businesses, but the lack of competition in the country often invites criticism. We only have five big players in grocery distribution: Empire/Sobeys, Loblaws, Metro, Costco and Walmart.

As profit-related accusations linger, the distributors could still show some empathy towards the public. There are few in-store discounts and promotions these days and flyers seem to be getting thinner since the start of the pandemic.

Grocers were subject to increased scrutiny during the pandemic, as one of the only public spaces to remain open during lockdowns. In a matter of days, they had to put protective measures in place and make the rapid switch to online retail. Actions to support struggling consumers, such as offering discounts for food nearing its best before date, will be key going forward.

Metro has made a step in the right direction by announcing it would use its profit margins to offset some of the cost of food price inflation. Other grocers should take similar steps to find ways to improve affordability for consumers, who can’t catch a break otherwise. If the big chains don’t demonstrate their intention to help the consumer struggling to balance their budget due to inflation, criticism of their profits will intensify.

This article is republished from The Conversation under a Creative Commons license. Read the original article.

By Janet Music, PhD Student, Social Anthropology, Dalhousie University and Sylvain Charlebois, Director, Agri-Food Analytics Lab, Professor in Food Distribution and Policy, Dalhousie University.

Video Interview: Paris Jewellers Co-Owner Discusses Company’s Future Growth Plans

By
Mario Toneguzzi
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Video Interview: Paris Jewellers Co-Owner Discusses Company's Future Growth Plans

Chau Lui, co-owner of Paris Jewellers, discusses the retailer’s launch of a new Connection collection with a goal of helping the Outreach Centre – an agency devoted to supporting women affected by family violence, help meet their basic needs, and find solutions to creating a safer, healthier and more secure life for themselves and their families.

Lui talks about the company’s philosophy of giving back to the community, how Paris Jewellers came to be, how it has grown since its inception and plans for the future.

Youtube video

The Video Interview Series by Retail Insider is available on YouTube.

Connect with Mario Toneguzzi, a veteran of the media industry for more than 40 years and named in 2021 a Top Ten Business Journalist in the world and the only Canadian – to learn how you can tell your story, share your message and amplify it to a wide audience. He is Senior National Business Journalist with Retail Insider and owner of Mario Toneguzzi Communications Inc. and can be reached at mdtoneguzzi@gmail.com

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Partnership Between Steel Art Signs and Gregory Signs to Yield Expansion, Benefits and Success for Each Company [Feature]

By
Sean Tarry
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Image: Steel Art Signs and Gregory Signs

The past two years have certainly proven to be one of the most interesting, dynamic and challenging times in recent human history. For retailers and other businesses, the tenor of the past 24 months has resulted in the development of an extremely complex environment that continues to change and evolve on a near-daily basis. It’s also served as a brutal natural assessment of retailers across the country, yielding a mixed bag of results that have ranged from desperation and depletion to pivots and innovation in the face of the adversity that’s resulted. And, it’s also facilitated creative partnerships and alliances among brands and businesses that share the same objectives and complement each others offering and expertise, like the one recently formed between Steel Art Signs Corp. and Gregory Signs – two of the countries leading full-scale, end-to-end signage companies. It’s a partnership that bolsters the credibility and presence of each company, and one that, Eric Hrivnak, Chief Executive Officer of Steel Art Signs Corp., says is rooted in the synergies and mutual benefits that are apparent within it.

“First and foremost, this partnership with Gregory Signs is going to help open a lot of doors into industries and sectors that, historically, Steel Art Signs has not always specialized in,” he asserts. “It’s a great partnership between the two companies because we each have complementary abilities and expertise to offer. However, we also each bring unique, specialized skills and experience to what we do, which will only serve to diversify our offering as a whole. To put it simply, we’ve enjoyed a lot of success with program work, while Gregory Signs has excelled within infrastructure. And now that the two have partnered up, each is learning from and influencing the other in a very positive way.”

Strategic partnership

Image: Eric Hrivnak and Boris Kaminsky

The partnership, represented by the acquisition of Gregory Signs by Steel Art Signs Corp., was formed a little more than six months ago and allows Gregory Signs to continue operating seemingly independently of Steel Art Signs. It’s a decision that was made mutually between the two signage experts and is one that has, according to Hrivnak, progressed extremely well to this point. The two companies, both based in Toronto, ON, will each remain deeply focused on the work that has earned their respective reputations, while afforded access to their collectively growing network and expertise. However, Hrivnak says that perhaps the greatest benefit that each company enjoys is the broadening of perspectives, ideas, and experience.

“For each company, there are all of these new and fresh ways of looking at and doing things,” he says. “Immediately, the people in the meeting rooms doubled, which for us has resulted in double the input and double the perspective and incredible transference of skills and experience. We’ve already seen ways in which each company can adopt the practices of the other, trimming the stuff that wasn’t working so well and replacing them with ideas and strategies that wouldn’t have been thought of prior. And, to be honest with you, the people at Gregory Signs were instrumental in this idea even coming to light. A company is nothing without its people. And, that means that if a company is successful, it is so because of its people. Every sector and industry throughout the country is struggling to find the right people with the right talent to fill positions. Partnering with Gregory Signs has suddenly surrounded everyone with a plethora of new top talent and allows each company to now work together toward a shared benefit, helping us progress and do what we do better.”

A way to grow

Image: Steel Art Signs and Gregory Signs

They are all sentiments that are echoed by Boris Kaminsky, Vice President of Sales and Marketing at Gregory Signs, and son of retiring company founder, Gregory Kaminsky. He, too, sees the incredible opportunities that are inherent within the partnership for each party and says that he’s really enjoying the experience so far with an eye on further growth and expansion for the company. In fact, from his perspective, it was the exponential growth of Gregory Signs, and the momentum that it had been building to this point, that served as the catalyst for his interest in forming the partnership with Steel Art Signs Corp.

“We’ve been experiencing quite a bit of rapid growth over the past number of years,” says Kaminsky. “We were receiving client orders from all over the place. It was growth based primarily on reputation and word-of-mouth. And it got to the point where I knew that we needed to grow further. We needed a factory that was double or even triple the size of the one we were operating in. We had received some interest from Steel Art Signs in acquiring us. And, after some deliberation, I decided, instead of growing on our own, to give my dad a good reason to retire and team up with Steel Art. It’s turned out to be one of the best business decisions that I’ve ever made. The company has an incredible reputation and is amazing to work for. And, we get to keep the Gregory Signs name and ability to operate as a separate entity. It allows us to go after different markets together, combining our forces to the best possible effect.”

Synergies and mutual benefits

Kaminsky goes on to describe how pleased he is with the decision he made to enter into this partnership. And, in agreement with Hrivnak, he underscores just how significant a role the synergies between the two companies played in its forming. They’re synergies that are also recognized by Michael Cormack, President, of Corbana Holdings Inc., who worked on behalf of Steel Art Signs Corp. to provide business advisory services for the acquisition. However, Cormack believes that the most intriguing element lending toward the successful acquisition was the mutually beneficial return that each company would receive as a result of the partnership.

“Gregory Signs had already established its own network and suite of sign services, which made it very attractive to Steel Art Signs Corp.,” he says. “It had enjoyed a unique market position servicing the architectural and construction industry as custom and unique design providers. And, Steel Art Signs had its national network and was focused on national accounts and consistent quality large run, high volume sign customers, in addition to providing well-designed and manufactured one-off sign projects. Each party brings something a little bit different to the partnership, benefitting both exponentially.”

A bright future

Image: Steel Art Signs and Gregory Signs

Hrivnak explains that the potential benefits that each company recognized at the onset of the partnership have already started to come to fruition and helping to pave the way forward toward further improvements and enhancements to each operation. He says that each is keen, too, to attack the work ahead of them in order to grow and expand even more and capitalize on the boundless possibilities that this strategic partnership presents. And, given the penchant that each company possesses for delivering quality service to as many clients as possible, Hrivnak suggests that there’s still quite a bit of room left for both Steel Art Signs Corp. and Gregory Signs to expand their presence further.

“The sign market in Canada is still robust enough for us to continue growing and expanding. We’re also considering diversifying our manufacturing portfolio. Our specialties and expertise are obviously related to signage. However, we have the know-how and capacity to be doing even more. But we couldn’t be any happier with the current direction of the companies and the work that we each do. The past six months have been a really great experience. and I’m looking forward to an exciting future ahead for both Gregory Signs and Steel Art Signs Corp.”

*Partner content. To work with Retail Insider, email: craig@retail-insider.com

Lenscrafters Opens at Park Royal in West Vancouver

By
Lee Rivett
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Lenscrafters at Park Royal Shopping Centre in West Vancouver. Photo: Shanon Thornley/Park Royal Shopping Centre.

American prescription eyewear retailer LensCrafters has opened at West Vancouver’s Park Royal Shopping Centre. Retail Insider previously reported on the construction signage in anticipation of the opening in October 2021.

Lenscrafters is now the third prescription eyewear retailer to operate in the mall after Bailey Nelson opened in 2019 in addition to B.C.-based Image Optometry which also has locations across the lower mainland, Vancouver Island and the interior of the province.

The Park Royal location is the tenth store in the Lower Mainland for LensCrafters with other locations in North Vancouver, Vancouver, Richmond, Burnaby, Coquitlam, Surrey, Langley, Abbotsford, and White Rock.

Lenscrafters interior at Park Royal Shopping Centre in West Vancouver. Photo: Shanon Thornley/Park Royal Shopping Centre.
Lenscrafters interior at Park Royal Shopping Centre in West Vancouver. Photo: Shanon Thornley/Park Royal Shopping Centre.

LensCrafters was founded in 1983 and sold to the United States Shoe Corporation (U.S. Shoe) in 1984. Its current parent company, Luxottica, initiated a hostile takeover of U.S. Shoes in 1995 in an attempt of acquiring LensCrafters which resulted in a $1.4 billion agreement being inked.

LensCrafters eclipsed its closest rival, Pearle Vision, in growth by 1992 and Luxottica purchased the retailer in 2004 resulting in the combination of America’s two largest eyewear retailers.

Canadian Online Furniture Retailer ‘Article’ Sees Phenomenal Growth During Pandemic: Interviews

By
Mario Toneguzzi
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Image: Article

Vancouver-based Article, a leading online modern furniture company, saw revenue growth of 45 per cent year-over-year in 2021 as the company has expanded its logistics network to support further growth.

“Investments in our fulfillment network, growth of our Vietnam office, and executive hires are among many recent company milestones that support our pursuit to build the easiest way to create a beautiful space,” said Aamir Baig, co-founder and CEO of Article.

Aamir Baig

“We anticipate the year ahead will be challenging for a number of reasons. Tailwinds created by the pandemic are subsiding and global supply chain disruptions are likely to continue for the immediate term. I’m confident we will continue to capitalize on the opportunity in front of us through the team’s collective determination and expertise.”

Nick Bozikis, the company’s Chief Financial Officer, said the past year’s growth was similar growth to what the company experienced in the year prior. 

“We’ve had a couple of really strong years through the pandemic. Certainly from a scale standpoint we’ve achieved scale in this sector now and have continued to kind of deepen our supply chain reach because of that,” he said. 

“We are now at the stage where we’re really kind of out there competitive and getting to be a significant player in this space.”

Image: Article

“We’ve had really good growth from the outset and then the past couple of years we’ve had some COVID tailwinds so it’s been phenomenal.”

Since launching in 2013, the company has delivered over one million orders to customers across the U.S. and Canada.

The company reached several significant milestones in 2021:

  • Delivered its one millionth order since the company launched its website in 2013;
  • Opened three new fulfillment centres in Houston, Vancouver and Chicago, which increased the company’s total warehouse space to over 1,860,000 square feet;
  • Launched Article’s in-house delivery program – the Article Delivery Team – in new cities: Boston, San Francisco, Austin, Dallas, Denver, Portland, Charlotte, Houston, and Chicago. The Article Delivery Team currently delivers over half of all orders;
  • Named one of Canada’s top growing companies by The Globe and Mail for the third year in a row;
  • Grew team to more than 1,300 employees worldwide; and 
  • Doubled office headcount in Ho Chi Minh City, Vietnam to support closer manufacturer relationships.

Article also added two executives to its leadership team – Mohammad Nejad-Sattary as the company’s first Senior Vice President of Technology and Matthew Ross, Vice President of Logistics, will oversee the company’s logistics network of 17 fulfillment centres and delivery stations across Canada and the U.S. 

Image: Article

“Our view was always that covering North America made sense. So covering all of the US and Canada. The business has developed, and has pretty consistently been, kind of 85 per cent US and 15 per cent Canada. It’s how we think about the business today,” said Bozikis. “There’s some ebbs and flows.

“I see a great opportunity for us to continue to serve the customer and be customer-obsessed. We’ve been pushing really hard to try to keep inventory levels strong, to continue to serve customers quickly. With supply chain being an issue globally, we think that’s really important to continue to invest and provide a high level of service for the customer.

“Our view is we continue to serve this category that is under-served. You’ve got great brands like IKEA who kind of serve the low end. You’ve got great brands like, especially in the US, Restoration Hardware who is serving the high end. We’re actually filling a nice gap in the middle where there isn’t a great trusted brand in there that’s serving customer needs and our goal is to continue to build that out and really make sure customers have access to high quality product that delivers good value and our view is just to continue to grow the customer base, introduce as many new people to the product and continue to deepen our reach on the supply chain side so we can keep delivering more and more value over time.”

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