KATHY CHENG

BY MICHAEL POWER

SEWING THE SUPPLY CHAIN

COLLABORATION IS KEY IN KATHY CHENG’S LIFE AND BUSINESS

It was from her father, Chak Cheng, that Kathy Cheng learned the meaning of grit. When the family first came to Canada, the Hong Kong native had to work three jobs. By day, Chak was a cutter for an apparel manufacturer. He also worked as a server in a restaurant on weekends while delivering pizza at night.

In the 1980s, after the Cheng family arrived, Google Maps didn’t exist. There were no smartphones to help navigate deliveries. Chak relied on maps or map books to navigate his new city.

Cheng’s mother worked as a seamstress. They spoke Cantonese as their first language. The couple had worked in the apparel industry while living in Hong Kong.

Their daughter eventually became partners with her father in the family business, RW & Co., a garment manufacturer he founded with his brother and sister in 1988, originally called Wing Sun Garments. She is also founder and president of Redwood Classics Apparel, their wholesale and stock premium program. Cheng started helping in the family business at age 12. She performed tasks like tax remittances, some basic accounting, quality assurance and trimming.

“Every summer pretty much, if I wasn’t able to find a job outside of the factory, my summer job was at the factory,” Cheng says.

Cheng attended the University of Toronto. She considers herself a hands-on learner, and graduated from the school’s co-op management program, now the Bachelor of Business Administration program. She then attended George Brown College’s post-graduate program for sports and event management.

“I’ve always loved managing events,” she says. “From the outside it looks easy and smooth, but on the inside, you realize there are all these nooks and crannies that bring a successful event to life.”

The program led to a job in Taipei, Taiwan. For about a year. Cheng ran a Canadian education expo for international students. When she returned to Canada, she worked at a financial consulting company called Brendan Wood International doing data entry. She moved quickly into project management, working to publish institutional equities reports. But the financial industry was demanding. The position paid well, but long hours meant Cheng rarely saw her family.

“This whole time my father and his brother and sister had continued to scale our manufacturing business,” Cheng says. “We’ve always been making in Canada, since 1988. He asked me, ‘if you’re working this hard for someone else, would you consider helping out in the family business?’”

A NEW DIRECTION

Cheng joined the family business in 2000. For the next several years, she worked to learn the trade, helping as best she could. In 2008, when the financial crisis hit, the business faced a decision: continue as is or get into another field, as most North American textile makers had done?

As the company grappled with these decisions, Cheng’s father asked her to become his business partner. She hesitated, unsure of whether that was the direction she wanted for her professional life. That time, around 2008, was the height of the fast-fashion era. Consumers wanted cheap clothes. They cared little for quality, what products were made from or how long they lasted. But the family business was built on values quite opposite to those the garment industry pursued at the time.

It was around this time, as the family pondered its next business move, that Cheng recalls standing on the factory floor and suddenly grasping the direction her career would go.

“I realized that I’ve had such an incredible life because of the factory, because of our makers,” she says. “Many of them had been with us for 10 or 15 years by that time. They literally watched me grow up. It was my ‘a-ha!’ moment where I said, ‘I’ve got to do this.’ Shortly after, my dad and I became business partners, in 2009, January.”

The company restructured with 40 people, focusing on collaborating with their brand partners. Since then, it has tripled its workspace and head count. Yet the values remain the same: quality products, flexibility and collaboration.

During the restructuring, Cheng went from vice-president to president, and around 2010 developed Redwood Classics Apparel, the company’s wholesale program. The program started as a cut-and-sew manufacturer but eventually expanded its backend value chain, offering a commissioned, local knitting service. The company brings in yarn by the container and then does custom knitting.

Reflecting on that period, Cheng is grateful she witnessed how local manufacturing and employment opportunities uplift communities. Many of the company’s employees were immigrants who had brought their skills with them when they immigrated from Hong Kong, a for-

mer textile hub. Cheng credits the value those immigrants brought with helping to propel the company’s success.

“We’ve been able to onboard new immigrants to our business and to be part of families and livelihoods,” she says. “It gave us economic and social impact. There are just so many things that our business has touched on. It wasn’t until the last seven or eight years that I started reflecting and recognized that’s what was happening.

“When we restructured, it was in the midst of fast fashion. There were not a lot of celebrations of (clothing) makers. If you think about it, clothing is the next closest thing to our skin. But do we ever talk about the people behind the scenes?”

The company started a social media campaign a few years ago called #FactoryFridays, Cheng says. The campaign involves showcasing each Friday on social media what’s happening in the factory that week. Recent posts include demonstrating how to insert a draw quarter – the drawstring in a pair of pants. The purpose is to give a voice to makers. While supply chains must be efficient, Cheng says, it’s important to retain its human side.

BOX OF CHOCOLATES

Cheng’s days at work are never typical. She likens the job to a box of chocolates: one day, she’s lucky and gets a dark almond chocolate, which she loves. Other days, she bites into a Maraschino cherry chocolate, which she dislikes. Either way, each day is an adventure that builds capacity to handle future challenges, she says.

COVID-19 made those days less predictable. But it has also opened opportunities for Cheng to offer help. At the pandemic’s start, supply chains shut down and masks and other PPE were in short supply. Redwood Classics had the know-how and equipment to make masks. They began a campaign, called #MadeForGood. For each set of masks sold on their e-commerce platform, the company donated one set to local organizations like Habitat for Humanity and Toronto’s SickKids Hospital, to name a few.

Cheng counts the campaign as a career highlight. Her biggest highlight came in 2014. That year, she became one of three Canadians inducted into the EY Entrepreneurial Winning Women program. The program identifies ambitious female entrepreneurs and provides advice and resources to further their business potential.

“I didn’t see myself as a leader, as someone with a voice,” she says. “That’s why I thank EY for it because they discovered me and my voice before I discovered it myself. EY and that program exposed me to opportunities through supplier diversity. It helped me to refine and think through our strategy.”

She encourages suppliers to apply to development programs. Regardless of the oucome, the application process alone helps them see where they are with their businesses.

From there, several other accolades came along. Cheng won the CAMSC Supplier of the Year award in 2015, along with a scholarship to the MBE program at the Tuck School of Business at Dartmouth College in New Hampshire.

She has also won the CAMSC Special Recognition Award for philanthropy and inclusive local procurement practices for the #MadeForGood Challenge. She received the WBE President’s Award and Canada’s LGBT+ Chamber of Commerce Ambassador of the Year Award. She appeared on the cover of the 2020 Annual Financial Report for the Royal Bank of Canada. She also made Inc. Magazine’s 100 Female Founders’ list for 2020.

Last year was also especially meaningful for Cheng’s career, as she was named to both the Advertising Speciality Institute (ASI) Power 50 list, one of a handful of women to make the list, and the Bay Street Bull Magazine’s inaugural Women of the Year list. Attending development programs has allowed her to connect with likeminded entrepreneurs, many of whom experience similar challenges, Cheng says.

“Which is why I’ve been so passionate about supplier diversity,” she says. “Not only did I get an opportunity to reflect and say ‘you know what, our business was able to make a human impact.’ But then I realized, all these companies invested in me. They invested in us as a diverse supplier, so then I can continue to give back. That’s why I’m so passionate about it. It’s really touched my life, not just professionally but personally.”

In her role at Redwood Classics, Cheng is not only a supplier but also a buyer and supply chain lead. Taking a broad, total-cost-of-ownership view of supply chain has served her well, she says. From her experience, large corporations often focus on a few key suppliers while excluding most others. But the pandemic has shown the importance of a diverse supply chain, Cheng says.

Cheng recommends that supply chain and procurement professionals categorize suppliers as small or large. Smaller suppliers are often more specialized in their offerings, while larger suppliers are more generalist.

“Make sure that you’re building and nurturing these supplier partnerships in the longterm,” Cheng recommends. “Don’t go to your suppliers whenever you need them and that’s it. That’s not what a relationship is. A relationship is a two-way street.”

A diverse supplier base offers innovation, flexibility and agility, she says. Large suppliers, while they can have these attributes, can also move slower than their smaller, more nimble counterparts.

Procurement can also look at the country of origin of the product or service they’re procuring, which can affect cost, Cheng adds. Redwood Classics Apparel acts local, but thinks global, she says. It can fluctuate, but about 50 per cent of the company’s factory output is exported. Made-in-Canada apparel has a stellar global reputation, partially because of the strength of Canada’s legal framework surrounding manufacturing, making such products valuable to those looking for sustainably sourced goods.

Cheng soon realized that supplier diversity offered strategies and opportunities benefiting both vendors and corporations. She got certified with CAMSC as a diverse supplier to access opportunities, soon discovering that corporate partners were willing to invest in her, such as sponsoring her for development programs. It was largely her involvement in supplier diversity, for example, that led to the opportunity to appear on the cover of RBC’s annual report.

“RBC reached out and said, ‘we know you’re a client and we were wondering if you’d be interested in taking part in our annual report,’” Cheng says. “I had no idea what was going on. I was like ‘OK, sure. Thanks! You guys have been great.’ And the photographer showed up and that’s when I found out it was for the cover. I was flabbergasted!”

North America has largely become a service-based economy, Cheng says. Supply chains were hit so hard by the pandemic largely because so many industries relied on offshore suppliers. While offshore sourcing remains important,

“All these companies invested in me. They invested in us as a diverse supplier, so then I can continue to give back.”

Cheng stresses the need to invest in local manufacturing and communities. This must be yearround, not just when it’s convenient or when disaster strikes.

Cheng looks forward to continuing to volunteer her time and expertise to non-profit groups and organizations, for example in supplier diversity. A message she has tried to spread is that supplier diversity can lead to innovative products. Corporate North America is finally embracing this concept.

Despite making her career within the apparel manufacturing industry, Cheng jokingly describes her sewing skills as “shameful.” While she says she can barely sew a straight line, she can spot imperfections in others’ work. And while people assume she has a passion for design and fashion, that’s not the case. “I’m in the supply chain of fashion but I don’t have a passion for fashion,” she says.

The pandemic has meant that Cheng has had little free time over the past two years. Still, she has recently taken up CrossFit and running, pastimes she says have taught her discipline and consistency while she strives to push herself past her physical limitations.

A source of support for Cheng has been her husband Ted, she says. She is proud that the couple avoids traditional biases about the roles of men and women in parenting their young son and daughter. And while her husband has his own career, he is supportive of her career and the family business, Cheng says. The family’s home during the pandemic has remained cheerful.

“If I had to reflect on COVID, one of the things that I’m most grateful and happy for is, I still come home to laughter. That’s precious,” she says.

BEYOND THE TOPLINE

Cheng advises those considering a supply chain career remain open minded about the field. Recognize that supply chain touches everything, whether products or services. A career in supply chain once conjured images of logistics and little else. But while logistics is important, there are many more professional roles available in the field, Cheng says.

Supply chain isn’t always the most visible aspect of business. But those working in the field must have a voice at the table and be recognized for their role. Business accolades often come from revenue generation, such as with sales. But supply chain fills another, equally important role.

“The narrative tends to focus on topline where, in my humble opinion, it really should be about the bottom line,” Cheng says. “I think too many people confuse revenue with profitability. It’s really the bottom line that matters.” SP