LITTLE ENGINES THAT COULD
Alberta businesses are optimistic about the economy and poised to grow
Teresa Spinelli, president of Italian Centre Shop, a grocery store with more than 30,000 products imported from Italy, is excited. Since taking over the family business in 2001, she has grown the store to three locations in Edmonton and one in Calgary.
“My father founded the business in 1959 in a 100- square- foot space where he sold imported chocolate and newspapers. When I took over, there was one store, 30 employees and $ 8 million in sales. Today we have four locations, 470 employees and $ 50 million in sales.” And it’s growing. She opened the first Calgary location two months ago and is already scouting sites for a second store.
“People were skeptical about our prospects because of the hit the Calgary economy is taking right now, but we had a really good response,” she said. “We’re not just a grocery store. We are a gathering place; we’re very much about community. At one point in Edmonton, we were the only store where you could buy a panettone ( Italian Christmas bread). Now, you can get it at Costco, everywhere. Why do people buy from us? They like being around us. It’s the relationship we’ve built with our customers.”
That closeness to customers is a recurring theme among successful small businesses and among the key reasons Canada’s small businesses are at least cautiously optimistic, even in the midst of a slow- growth economy.
“Every economy has pockets of strength. The million or so formal small businesses in Canada play a significant role because they are the ones that waver the least when we have shocks to the economy,” said Ted Mallett, vice- president and chief economist at the Canadian Federation of Independent Business.
“In 2008 and previous deep recessions in 1982 and 1990 it was the big businesses laying off large numbers of people. Small business was far more stable in terms of employment levels.”
According to Industry Canada, small businesses employ about eight million people, contribute more than 30 per cent to the gross domestic product and account for about 98 per cent of all businesses in the country. But their power goes well beyond numbers.
“Small business is the means by which economies shift and take advantage of new markets,” said Mallett.
“There are between 100,000 and 150,000 startups and roughly ( the) same number of exits each year. This cleanses the economy and brings new ideas into the fray. They don’t all survive. The aim is to get as many actively going as possible and for those present to grow.”
Shelly Anderson, founder, owner and CEO of Naoka Inc. in Sherwood Park, is doing just that. She launched Naoka Inc., which employs First Nations to manufacture buggy whips ( vehicle safety devices) for the mining industry, in 2012. Last year, the company experienced 400 per cent growth in sales.
Anderson went on to win the 2015 Aboriginal Business Woman of Distinction award for the province of Alberta. While she said current times are challenging, she remains optimistic.
“I have been approached to enter markets in the U. S., Australia and South America. That’s all great, but I need to be careful right now with cash flow. There is still enough room for us to be profitable. We are continuing on. This is not the first time the economy has dipped, we just have to batten down the hatches.”
It’s a much different story for chef turned entrepreneur Kevin Kent who was in Kyoto, Japan on a buying trip for his two retail stores: Knifewear, which sells handmade Japanese knives, and Kent of Inglewood, which he describes as Canada’s shave shop.
He has launched eight stores in eight years and plans to expand into Vancouver in 2016. Revenues grew 63 per cent last year and he expects to see 25 per cent growth this year.
“We thrived in the economic downturn because people need to cook, we sell affordable luxuries, we are a fun place to shop, people are tired of disposable things and crave authenticity.”
Kent was first introduced to Japanese knives when he was working as a chef in London, England. In 2007, he returned to Calgary and began importing “with the big plan of selling them to other chefs out of my backpack,” he said.
“We now have five knife stores selling Japanese handmade kitchen knives. We are probably the biggest sellers outside of Japan even though we’re not in Vancouver or Toronto yet.
“Kent of Inglewood started as a kiosk in our Knifewear store because customers began asking for straight razors.
“Pretty soon, we were selling pomade, combs, brushes, axes, pocket knives, fly- fishing gear. ... It’s become a heavily curated men’s department store. We launched two more stores, one in Edmonton and one in Ottawa. All systems are go.”