J UNE 2009
BusinessExaminer
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Going for the Green Lake Countrys’ Multi-Million Dollar Dilemma
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Contributing Photographer Shawn Talbot | 1.888.317.1403 | shawn@shawntalbot.com | www.shawntalbot.com Contributors Dominik Dlouhy | Deanna Brooks | David Crawford | Jack Lee | Kevin Rothwell Mailing Address P.O.Box 32034 RPO, 2151 Louie Dr. West Kelowna, B.C. V4T 3G2 | Fax 250.768.8241 Subscription Rates 12 issues annually | One year: $27.00 | 250.863.4636 Distribution The Okanagan Business Examiner is published monthly at Kelowna, BC by Prosper Media Group Inc. Copies are distributed to businesses from Osoyoos to Greater Vernon. The views expressed in the Okanagan Business Examiner are those of the respective contributors and not necessarily those of the publisher or staff.
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J UNE 2009
BusinessExaminer
The Voice of Business in the Okanagan
Going for the Green Lake Countrys’ Multi-Million Dollar Dilemma
When the Governor General matters
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JUNE 2009
ISSUE HIGHLIGHTS Cover -Lake Country’s council sits on a very big green field
Coaches on Coaches
Who needs ‘em and why
eBlasts - How to get the
word out in a wired world
Mint Property
The trend to affordability?
Business Profile
Getting into the Big Steel Box
04 12 15 19 25
DEPARTMENTS Stealing the job of a 10 year old
16
Stop fuel theft if you can
17
Dlouhy on the economy’s rough ride
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Managing Editor | Devon Brooks | Photo: Shawn Talbot There are rumblings that Michael Ignatieff might trigger an election this summer over the Employment Insurance issue. This is political posturing. The electorate is in no mood for an election in this late arriving summer. This is more of a political message from Ignatieff serving notice to P.M. Harper that the Liberal Party is not going to pull Stephan Dion’s shrinking violet routine, afraid to call Harper’s bluff. The threat is real in so much as Ignatieff wants both the voters and Harper to believe that he does have the mettle to call an election, even an unpopular one, if he thinks the timing is right. As the 21st century begins to mature the question I think is going to be increasingly, is there ever a right time, for a party wanting a majority? Everyone remotely interested in politics is well aware that voter turnout has been declining for decades. Less well recognized is that the distribution of the votes is flattening as people become more disenchanted with what they seem as the same messages trotted out by the same parties each election. That’s why an independent triumphed over Wally Oppal and why the Green Party has a persistent if small presence, even though they have yet to take a single seat. The provincial conservative party sucked away a few votes from the Liberals and the Greens likely did the same to the NDP. The preceding examples are provincial, but I believe this is also going to happen nationally. This will give rise to more parties, each of which
siphons off a bit more of the vote from the “traditional” ruling parties, those being of course the Conservatives and the Liberals. Last December Harper had his political brush with mortality when the formerly toothless Liberals rose up in conjunction with the NDP and the Bloc to threaten his government. Only his dancing on the head of a monarchial pin allowed him to survive. If those two trends of fewer voters spreading the vote among more parties continues, Harper will turn out to be only the first Prime Minister forced to deal with this. If there are more minority governments, if more parties get a toehold in the country’s legislatures the Governor General’s role will change from that of ceremonial figurehead to a key player because there will be more crises like last December’s. As such his or her appointment will then become a politically charged one and much more important than it has in the past. Not only in terms of what she can and can not do, but under what circumstances. If that’s the case then we as Canadians, and those in government need to set down some concrete rules that make the GG’s job more relevant, accountable and able to prevent a political crises that might cause the government to freeze at a critical moment in the future.
June 2009
REACHING NEW HEIGHTS IN ENERGY CONSERVATION MOLSON CANADA 2009 POWER SMART LEADER Rene Holt, Plant Manager
MOLSON CANADA’S BREWERY IN VANCOUVER IS TACKLING AN AMBITIOUS PLAN TO SHRINK THEIR ENERGY USE BY AT LEAST 5% EACH AND EVERY YEAR, A PLAN THAT HAS QUICKLY TRANSFORMED THE BREWERY INTO THE COMPANY’S MOST EFFICIENT IN THE COUNTRY. For the people of Molson, that kind of ongoing improvement means totally rethinking how they use energy on a daily basis. It’s a big change, but they’ve already proven themselves by cutting their electricity needs by nearly a fifth. With such a stellar commitment to conservation, you can see why Molson Canada deserves to be recognized as one of our 2009 Power Smart Leaders—the province’s brightest lights in clever energy management. It’s all a part of this year’s Power Smart Excellence Awards, where we celebrate inspiring work toward the future of energy in BC. And there’s plenty to be inspired by, as large and small organizations across the province discover that saving energy is something that’s definitely worth celebrating. Get recognized for your commitment to energy excellence. Find out more at bchydro.com/awards.
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June 2009
The ‘Home of Golf’ makes a play for
Lake Country Rural municipality may reject half billion dollar investment By Devon Brooks | Photo Contributed When exactly they started playing golf in Scotland is unclear, but in March 1457 an Act of Parliament of Scotland stated “the fut bal ande the golf” were forbidden, law breakers being liable to punishment by the barony courts. A century later, by 1552, times had changed. Players on the world’s most famous golf course, the Old Course at St Andrews in Fife, Scotland, were
granted permission to “play at golf, futball, schuteing…with all other manner of pastimes.” In time the Royal and Ancient Golf Club of St Andrews formed. The Club does not own the Old Course, nor do its members have exclusive privilege to use the course because the Old Course is a public golf course.
That doesn’t mean it is not extremely prestigious. Golfing legend Jack Nicklaus was quoted as saying, “If a golfer is going to be remembered, he must win at St Andrews.” Tiger Woods has won there twice. Three years ago a group of people affiliated with the club formed a consortium known as St Andrew’s of Scotland LLC & Development
Partners. They decided that their unique golfing experience should not be limited to that one course, no matter how prestigious.
The Mayor says, “The tax base would change from agriculture, which is the lowest, to commercial, which is the second highest.”
The group hatched plans to construct a network of 30 golf courses around the world. While the courses would be limited to the extremely wealthy who could afford membership, the courses would be about more than great golf. The courses would be surrounded by resorts, open to the public and attractions in their own right.
Lake Country has a very small tax base because there is little industry in Lake Country. Most of the community’s residents must commute every day to neighbouring Vernon or Kelowna to find work. While agriculture is an important part of the economy there, fewer and fewer people are able to make a living from full time farming each year.
Each golf course would be at the heart of amazing facilities that tie in to the region in which they are located. The only site in Canada where one of these new St Andrews courses is to be built is the Woodsdale Ranch, a 465 ha (1148 acre) spread along the benchlands on the eastern edge of Lake Country. The ranch is privately held by the Macdonnell family, who have owned the land for decades. Today, after three years of entreaties, the council of Lake Country is wrestling with its own decision whether it should grant permission to “play at golf, futball, schuteing…with all other manner of pastimes.”
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At issue, according to some councillors, is nothing less than the nature of Lake Country. The Mayor, James Baker, would like to see the half billion dollar development proceed. Councillor Noreen Guenther is much less committal. She asks, “Does the public want to see that area as a growth area? If not then the process should end right there.” One reason for putting the project through is an improved tax base.
Councillor Geoff Greenwell says it is more than just increased taxes, it is about providing good paying jobs in the community of which there are very few. He also believes, “We need to diversify the tax base with benign developments.” By benign Greenwell means jobs with little or no pollution, few if any extra costs for the municipality, well paying jobs and benefits to Lake Country’s reputation, economic base, tourism, and with a good environmental plan and beneficial to agriculture. Max Tomaszewski is with the Amadon Group, a Vancouver-based development company hired by the St Andrews consortium to get this proposal through Lake Country. He says the plan is good on all those counts. Mayor Baker says the opposition from within council comes down to the results from a survey asking residents what they wanted most in their community. Lake Country residents indicated that they want the community to retain a “rural” flavour. Guenther believes, “There is a feeling that we should keep the area
June 2009
rural.� She adds, “I think people consider ‘rural’ as being larger land holdings.� Greenwell counters, saying, “This [development] is in keeping with citizen’s desire to have a rural look and feel.� The Mayor says, “The council is split as to how much development we want.� Councillor Bill Scarrow sees this development as one that could redefine Lake Country and he says, “I am waiting to see if people are in favour of this becoming a resort community.� If it goes ahead, he says, “Some people see it as us becoming a Whistler, which is too big and too expensive.� Greenwell is clearly for this development, but agrees a project as large, famous and well financed as this would put Lake Country on the map. “It’s a potential defining development for Lake Country.� Despite the fact that the developer first approached council more than three years ago, Councillor Guenther says they shouldn’t be rushed into a decision. Tomaszewski says time is now
becoming a factor. “We’ve been patiently working through this for three and a half years and we’ll work on it a while longer, but unless we hear soon, we will go elsewhere.� Asked why it has taken so long to garner public feedback on an issue first brought to council three years ago, Guenther doesn’t answer directly, but says the plan was first applied for under a section of the development rules that she doesn’t like and didn’t think should be used for this project. Last year the application was done over, but public opinion is only being sought this spring, as just one aspect among many under the auspices of Lake Country’s OCP renewal. There are a half dozen meetings planned to gather public input on the OCP and Guenther insists no decision should be made until that input comes in. For the most part the project doesn’t seem to be on the public radar. Of the two meetings held so far, Mayor Baker says, “People are not turning out in hordes to support it or to speak out against it.� Councillors Guenther and Scarrow agree that neither have heard
a great deal for or against the project from those who went to the meetings. Although Guenther says one of the concerns she has heard is that the new golf course will not be accessible to the public, currently not one acre of the Woodsdale Ranch has public access. If the project is allowed to go ahead the 315 acres designated for the golf course will be private, but the remaining 830+ acres will be open to the public. What will be available for public use includes a spa, winery, resort, hotel, residences and, over a quarter of the total land package, a trail network. Tomaszewski is quick to point out that the residential construction will be centred on a small portion of the total package. For agriculture, he explains, “Seven hundred of the 1,200 acres are in the ALR. For 300 of those 700 there is approval for a golf course. The other 400 are not irrigated [but they would] now be planted in vineyards, a cherry orchard and flowers. There will be a benefit and not a taking away.� The Mayor says, “People want to keep a rural atmosphere and this development has a lot of open space – approximately 600 units on 30%
Okanagan Business Examiner
of the land and 70% of open space. I think that’s Smart Growth.� The Woodsdale Project website says the project is being designed using the most comprehensive environmental standards possible including LEED certification “with cradle to cradle practices wherever possible and low impact development based on “Smart Growth� principles. Developing and maintaining this project is going to be very expensive. To put in all that infrastructure, Tomaszewski says, “The investment will be in excess of half a billion dollars over a period of seven years.� Providing water for the whole project from golf course to winery, cherry orchard to residential units will require a reliable, dependable water source, which will be met with the construction of a reservoir. Tomaszewski confirms this, saying, “The water supply will not be an issue. There is plenty of water.� He says no neighbour will suffer from a shortage or degradation of their water supply. The reservoir will be built using the consortium’s funds, but will become municipal property once
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finished. Residences and roads on the other hand, will be owned and maintained by the consortium under a strata development plan. This means that maintenance costs and snow removal will continue to be on the owners’ tab leaving a much smaller footprint on the municipal maintenance bill while still contributing to the tax base. Asked why Lake Country is the consortium’s preferred target Tomaszewski says, “The area is a quintessentially Canadian location.� He says it is rural, overlooks three beautiful blue lakes, has access to two nearby ski hills and the Canadian winter scene while giving, through its backdoor, access to a wilderness setting, which is closely linked to Canada in many foreigners’ minds. At the same time the mountains and the region is spectacularly beautiful which, when combined with the Okanagan’s agreeable summer weather and a growing reputation for wine, provides an attractive lure to golfers and other visitors. The final link is the ready access to a fully equipped international airport. The project wants the town. CONTINUED ON PAGE 6
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Does the town want the project? The Mayor does. “I think that there would be more benefits than drawbacks.” He also believes it will help to attract businesses that would fill in Winfield’s town centre, on which the municipality has spent considerable funds to improve with the creation of a new main street and many commercially zoned lots, most of which are currently sitting vacant. Even Scarrow admits, “That project…has quite a lot of potential. Within the OCP we need to decide what will be the most beneficial and cost effective method for the development of this resort.”
Greenwell says that if the project is rejected it ironically probably won’t save the Woodsdale Ranch. “In future it will stay as is, become a resort or a huge subdivision.” He makes it clear that the last is what he sees as the most probable. Tomaszewski concludes, “This project is very much alive and its just a question of whether Lake Country wants it or not.” Mayor Baker is well aware of the project’s time limit, which Tomaszewski says is the coming fall season. The Mayor’s response is: “I’m aiming to have the second reading sooner rather than later.”
The picture shows the giant Woodsdale Ranch, which covers 1,148 acres and, if Lake Country council approves, will be converted into a golf resort with links to the world’s oldest and most famous golf course – St Andrews in Scotland.
Summary of the Woodsdale Ranch St Andrews Golf Resort proposal: The Resort Core (9.4 acres)
Organic vineyards
Wellness Centre and Spa
Organic cherry orchard
Destination restaurant with banquet and meeting rooms
Flower garden (tourist attraction similar to Butchart Gardens)
120 room boutique hotel and amenities
Guest ranch with riding school
Resort residences (175)
Guest farm
Gold Mine Visitors centre
Trail System and Nature Reserve (approximately 341 acres)
Winery
Irrigation Lake
Agricultural land (346.2 acres)
Championship Golf Course with Club House (315.0 acres)
June 2009
Location
Venue
Total Area
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Biggest Meeting Spaces in the Okanagan
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Penticton Trade & Penticton Convention Centre and the South Okanagan Events Centre Sunwave Centre Salmon Arm
60,000 +35,000 (SOEC)
13 +2 (SOEC)
50,000
6*
Vernon Recreation Centre
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49,751
Delta Grand Hotel & Convention Centre Wesbild Centre (Vernon Multiplex)
Kelowna
Okanagan Business Examiner
Other Facilities & Services
Largest Single Space
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17,704 30,000 (SOEC) 17,000
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catering, pool, dressing rooms, fitness rooms, sauna, hot tub, restaurant, A/V catering, dressing rooms, two pools,
40,000
19*
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15,652
Vernon
23,105
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20,500
Penticton Lakeside Resort Prospera Place
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Kelowna
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The Prestige Harbourfront Resort & Convention Centre Best Western Vernon Lodge Coast Capri Hotel
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catering, restaurant, gym, pool, sauna, casino, A/V Manhattan Point Restaurant, dressing rooms, catering, A/V, liquor licence catering, restaurant, gym, pool, sauna, A/V, wifi
Vernon
9,916
10*
catering, restaurant, gym, pool, sauna
7,520
Kelowna
9,833
10*
Prestige Hotel & Conference Centre
Vernon
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6*
banquet & catering, restaurant, outdoor 4160 pool, fitness centre, full service spa, airport shuttle service, wifi, coffee bar catering, restaurant, gym, pool, sauna, 3,600 wifi, A/V
Sonora Centre
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8,498
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4,720
Manteo Resort
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catering, restaurant, gym, pool, sauna, wifi, A/V, movie theatre
2,700
Cove Lakeside Resort Sandman Inn
West Kelowna Kelowna
4,500
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catering, yoga, pool, hot tub, A/V
1,500
4,238
3*
2,800
Walnut Beach Osoyoos 1,800 *room walls can be removed to make a larger room
3*
catering, restaurant, gym, pool, sauna, high speed, Internet, Denny’s, sports lounge, A/V wine/tapas bar, catering, pool, hot tubs, sauna, Internet, wifi, A/V
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June 2009
MOVERS &SHAKERS Hummingbird opens with a splash Mara Lake Estate’s Hummingbird Beach Resort facility celebrated its official opening on May 20th by having 20 kids jump through a ribbon into the lake. More than 200 potential buyers, owners and their families were on hand. On its opening day the resort, on the shores of Mara Lake just south of Sicamous, sold 31 units which consist of stand alone cabins, townhouses and condominiums overlooking the beach and dock area.
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Recession gets real Even as the media is quoting stock analysts and bankers who are suggesting that the recession is beginning to ease, job losses are hitting hard. Compared to a year ago Okanagan communities are reporting triple digit increases in the number of people receiving Employment Insurance benefits. Kelowna numbers increased by 202% from 1,630 in March 2008 to just under 5,000 this year. Penticton had a 148% increase and Vernon a 108% increase. For Canada as a whole the increase is substantial at 46%, but not as dramatic as the Okanagan numbers. Ironically part of the reason that local numbers are so bad is that the recession was already starting to take jobs in the rest of the country a year ago, while B.C. and Alberta were shielded by the high oil prices and booming construction industry.
Little guys outspend the big boys on training A report from the Canadian Federation of Independent Business shows that B.C.’s small businesses spend $3,115 annually, on average, for employee training. The numbers come about as a result of a survey of 8,077 small businesses in Canada and includes costs spent on informal and on-the-job training as well as more structured classes with teachers. The Canadian average is $2,700 per employee, but British Columbia’s business owners spend more time and money than other Canadian businesses. Sadly the investment does not pay back as well because smaller companies have twice the chance as larger companies that an employee will move on.
Osoyoos gets stars in its eyes Destination Osoyoos in conjunction with Black Hills Estate Winery are inviting a number of movie stars and other celebrities to the Osoyoos Celebrity Wine Festival in June. Those expected to attend include: co-host Jason Priestley (Beverley Hills 9020, Hollywood & Vines), Bruce Greenwood (Star Trek, National Treasure), Paul Gross (Men with Brooms, Paschendaale), Erika Eleniak (Baywatch), Canadian Olympic Gold-medal winning athlete Michelle Cameron, Dean Cain (Superman), Tiffani Amber Thiesen (Saved by the Bell, Beverly Hills 90201), singer Jann Arden, Chef Ned Bell (Food Network), Terry David Mulligan (The Tasting Room) and Emmy Award-winning producer Chad Oakes (the other co-host). Entertainment Tonight Canada will also be in town to capture some of the events. The four main events include the Osoyoos Celebrity Wine Auction, the Nota Bene Release Party, the Burrowing Owl Winermakers Dinner and the Desert Spirit BBQ party.
Vernon’s Business Best Vernon handed out accolades to those companies that were recognized by their peers at its annual awards ceremony last month. Kal Tire was not only crowned Business of the Year but also received the Sterling Service Award. Employer of the year is Pure Granite Rocks while the Marketer award was given to Nixon Wenger Lawyers. The Small Business award was presented to Cotton’s Chocolates while the best New Business is Triboda Printing Company. Singled out for being a Community Supporter was Wendy’s Restaurants while the Personal/ Professional award went to Interior Home Inspections. The Young Entrepreneur of the year is The Rice Box.
One becomes two Flightcraft has divested itself of one division by selling it to two of its own. Mike Sizeland, formerly Flightcraft’s VP of aircraft modifications and Bob Monaghan, the former director of strategic development have purchased the international operations division and have renamed it AVM Solutions Inc. Initially the deal allows AVM to continue using Flightcraft’s facilities and parts before the new company acquires its own space. Sizeland and Monaghan have brought in Steve Davidson (formerly of Colonial Aerospace Group) as a third partner.
Kelowna gets preparatory school The Aberdeen Hall Preparatory School, consisting of a Montessori Pre-school, kindergarten and elementary grades, opened the first phase of its new $7.5 million dollar campus on a 19-acre donated land parcel sitting next to UBC-O last month. A 14,000 sq. ft. performance centre is expected to open this
June 2009
September. Phase 2, a gymnasium and high school, will open at an undetermined date in the future. Aberdeen Hall was already open in temporary facilities and school but Chris Grieve, the school head, says with the new facility more spaces have opened up and attendance has jumped up to 170 students, which represents a 25% increase from the ’08-’09 session.
Radics on board Rea Financial Services of Vernon announced that Caroline Radics had joined their team. Radics has experience in life insurance products and investments.
Arsenault takes over EDC in Penticton
David Arsenault is the new Economic Development Officer for Penticton. The position is filled through the Penticton and Wine Country Chamber of Commerce using City of Penticton funding. Arsenault has prior experience as an EDC officer in Grand Forks, but has most recently been a professor at Okanagan College in the Faculty of Business. He has also worked at the Regional District of OkanaganSimilkameen.
Sandman harvests donations The Sandman Harvest Foundation is a charitable organization dedicated to helping families and children while recovering from illness. Last year the Foundation gave out $65,000 to these people. This year the Foundation is hoping, in spite of the economy, to beat that mark and held a meeting on May 26th to raise awareness. Those interested in participating or contributing should contact Al Hryniuk, the co-chair of the Foundation at 250-763-3550, ext. 216.
Mirror, mirror on the wall, who’s the greenest of them all? Kelowna’s 10th Annual Mayor’s Environmental Expo presented awards in six categories including the Most Environmentally Innovative Business Initiative. The winner was Spider Agile Technology, which manufactures modular electrical systems. Not only selling the environment angle Spider Agile demonstrated its commitment with a move into a new facility enhanced by xeriscaping, solar panels for heating and an in-house vegetable garden. Honourable Mention went to Ecoscape Environmental Consultants and two Certificates of Appreciation were awarded to Okanagan College and Turf Logic.
Fortis declares itself for the birds Fortis, the power company of B.C.’s interior is posting a live feed of an osprey nest on its website at: www. fortisbc.com/environment/osprey nest program.html. The company says it relocated the nest from a nearby live power pole on Benvoulin Road in Kelowna by building a nesting platform and transferring the nest there. Osprey come back to the same nest year after year and build it up. Fortis says the live feed is popular with viewers and the nest transfer, done with the guidance of a professional biologist reduces the risk of electrocution for the ospreys and damage to Fortis’ power line. This is not an isolated example – the company builds nesting platforms every year for nesting birds of prey.
Applause for barrel chop Wine makers are happy about a decision by the federal government to eliminate a 3% tariff on imported oak barrels this year. The oak barrels cost approximately $1,000 each and last about five years. With medium sized wineries stocking from 1,000 to 2,000 barrels each, the savings runs from $6,000 to $12,000 a year.
year when confidence dropped to 35.5. Among respondents 22% say they will hire some new full time employees this year; 25% intend to take on some more part-timers. Just under half of the businesses says the overall state of business is “satisfactory” while 31% describe it as “good”.
Valley Wide as popular as ever The annual Valley Wide Business After Hours event, held this year at the stunning Nk’Mip Cellars Winery in Osoyoos, remains as popular as ever. Kenn Oldfield, president of the South Okanagan Chamber of Commerce, which hosted the event this year, estimated the crowd at between 300 and 400 people. Ron Restrick, centre, general manager of Summerland’s Kettle Valley Steam Railway, visits with Scott Boswell, Summerland’s economic development officer.
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Okanagan Business Examiner
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May 2009
CommunityLeader Business Examiner June 2009
Sam Samaddar “You have to look at our airport as a manufacturing facility sometimes. People are the throughput and airplanes are the delivery vehicle.”
Position - Airport Director at Kelowna International Vision - To take the airport to its next level by inaugurating transcontinental service and serve a projected increase in passengers of 15% from 1.39 million in 2008 to 1.6 million by 2015. The growth, says Samaddar, will happen despite an expected decrease this year due to the world wide recession. Samaddar says getting there depends on pushing for continual upgrades to facilities at the airport to accommodate bigger aircraft and making the experience more friendly to both passengers and the airlines. He believes the first flight from across the ocean will probably come from the United Kingdom, likely to take advantage of skiing opportunities.
Assets - Twenty-one years experience in airports, a passion for working with people, regional input and local commitment from the City of Kelowna, which owns the airport.
Background - He took his first position at Vancouver International in 1988 after graduating from Wilfrid Laurier University in Ontario and a stint at the Department of External Affairs working on the Francophonie, Expo 86, Commonwealth Heads of State and G-7 summits. Samaddar came to Kelowna’s airport in 1992. Five years later he completed his International Accredited Airport Executive designation and took over as the airport’s general manager in 2008. Photo contributed
June 2009
Okanagan Business Examiner
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No reasonable offer refused Development of the Airport Business Park in Kelowna is slowed by the recession Story and Photos by Devon Brooks
Right across from Kelowna’s International Airport sits one of the city’s newest business parks, squeezed in between UBC-O and the Pier Mac gravel pit. This is also the only route into the Quail’s Gate golf course and residential community that overlooks the Airport Business Park, which sits directly across the highway from the airport.
beautifying the land and turning it over to the industrial park. While most of the land still consists of empty lots of weeds or is still an active part of the gravel operation, the park has strict guidelines about the look of what goes in there. As quickly as it is economically viable, Buchanan says the intention is to create an industrial park that has a “campus like feel� to it.
The City of Kelowna has rezoned the land from P4 utility to a special CD15 Commercial zone allowing some retail development, a hotel and an industrial designation for “a wide range of clean business, office, technology, manufacturing, sales and service, fleet, distribution, industrial, warehouse sales uses, in a business park setting.� Buildings can be up to four storeys in height.
Right now Quail’s Gate residents wanting a loaf of bread must make a 20 minute drive to Winfield so some retail operations on the industrial should cater to their needs and generate strong sales. The same opportunity will likely apply to University residents.
The park, once fully built out in four, or possibly five, phases will cover 59.6 ha (147.3 acres) including road allowances. Phase one consisted of 18 lots; 15 have been sold. The lots ranged in size from 0.4 to 1.7 ha (1 to 4.2 acres) and started at $1 million. Kevin Buchanan is an accountant and controller for Pier Mac, which is the sand and gravel operation located next to the business park. Pier Mac is also the owner of the land and, generally speaking because of its dust, noise and general industrial appearance, not the favourite neighbour of Quail’s Gate residents. While Buchanan wryly notes that the gravel operation was there before the residents, he and Pier Mac have every intention of
The retail section along with the airport hotel will, from a business perspective, help the park draw in money from the university, the residents and the business park employees.
large to put on the market all at once. If is definitely too big for the current market. Says Buchanan, “All phases are slowed by the recession.� Regarding the last three available lots from phase one, Buchanan notes, “The pricing is still comparable with 2008, but having said that, if people were interested they should come and make a reasonable offer.�
Not only are fewer people looking but he says those that are interested are having a tough time financing, which is a pity because construction costs are significantly down from the building boom of the last few years. Still, Buchanan is optimistic that the site’s location plus its advantageous zoning will allow the park to go ahead, albeit more slowly. The airport, which is owned by the City of Kelowna, has no affiliation
with the business park. But, Sam Samaddar, the airport’s general manager, says the airport isn’t just about moving people in and out. It is a business entity and he is very aware of the many companies and goods that the airport supports. He says the airport relies on the private sector to meet many of those needs including, finding and developing nearby land to support enterprises that both support, and draw on the airport.
" " ! # # " "
The hotel will draw on airport passengers of two kinds. Buchanan says they expect the aviation industry to keep growing and with the airport’s new runway allowing bigger planes, more people will come to Kelowna for training, equipment or service. Many will want a conveniently close place to stay. For passengers who make use of the airport, but don’t live near it, the hotel will provide an easy place for a one night stay on the way in or back. Construction on the hotel was scheduled to begin this fall, but Buchanan admits the recession may well cause the date to be pushed back. The land the gravel operation now sits on will be part of the phase four and, possibly, phase five developments. Buchanan says phase four currently consists of a 28 ha (70 acre) chunk, which might be too
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June 2009
Coaches Brian Bonsma, David Huck and Joseph Seiler (l to r) show how their thinking on coaching is similar, even if they come at it from different angles.
Coaches Corner in their own words Three of Kelowna’s registered coaches talk about the business of coaching and how it works Brian Bonsma’s background was in commercial insurance, which gave him an insider view into many different kinds of businesses, which he has combined with his training and an extensive business library to provide hard results for his clients. David Huck has excelled in team sports and added to his knowledge of human behaviour with a Master’s Degree in Leadership and Training at Royal Roads University. He is also the principal in the SigmaGroup coaching firm.
Joseph Seiler believes what you want is what you get. The trick, he says, is to help people find the right action to help them achieve what they want. He was a naval officer for 15 years before becoming an entrepreneur, businessman, a patent holder, author and coach.
Effective coaching OBE: What makes for an effective business coach?
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is about you. It’s your agenda, you’re a whole person – it’s not just this one tiny thing. Nobody gets to be wrong; you are creative, resourceful and whole. That’s an assumption we start with.
Brian Bonsma (BB): Around the table you’ve got three very distinct types of coaches sitting here. Yes, we all fall under the umbrella of business coach, but we deal with it in different ways as well. Joseph, you handle the CEOs in that leadership position sort of leadership capacity.
JS: Primarily I am dealing with the person to see how self aware they are. I am opening the blinders so that they can see what’s really happening. BB: In contrast to that you’ve got
David R. Huck M.A. CSC; Leadership Coach, Facilitator, Consultant
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Joseph Seiler (JS): Coaching
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myself who deals with the business owners in very hard, nuts-and-bolts kind of businessy ways. So we’re looking at financial statements, marketing plans, vision statements – those kind of structured ways of developing the hard and fast parts of a business. Still coaching, just slightly less on the person, more
on the business. So a holistic view of the business as opposed to a holistic view of the business owner.
David Huck (DH): There’s a recognized taxonomy in coaching that’s been developed over the years and so Brian’s talking about a form of directive coaching whereas I think Joseph is talking more about a form of non-directive coaching. My feeling is you have to be adaptive as a coach, and in the business sense I am often much more directed. In the leadership sense I have to be non-directive.
Limits OBE: Where are the limits? Where does my inability to communicate and, say anger management, go from something you can coach me on to something more than what you should be doing?
JS: If you try to pick up a kid in a grocery store who suddenly goes limp, he weighs 700 pounds. The person who does not want to change is not coachable. That’s all there is to it.
DH: Your anger management is one of the 11 conditions you are supposed to refer to therapy. You’re supposed to be able to recognize that is where you would draw the line.
JS: It is not the coach’s job to judge the behaviour. It is the coach’s job to help the client explore the impact of the behaviour and get them to look with a mirror and say, ‘Is this the results, is this the impact you’re seeking?’ As long as they’re responding, and they’re starting to look and becoming happier and more successful, it’s not for me to say, ‘You’re still too angry.’ It’s not for me to set the bar of how angry is too angry, how aggressive is too aggressive.
DH: Your question is about business coaching but the reality is that business coaching always takes in the elements that are more than just business coaching. It also takes in the leadership of the business. The subject you chose is 60% of leadership derailment. It is personal communication. As a consequence we do a lot of coaching around
June 2009
leadership derailment factors. Communication is number one and often that can be ‘command and control’ environments, which don’t work anymore. A lot of our work is to help leaders communicate at a much better level.
And I’ve heard from someone in the corporate field that the higher managers are leaving and their are no competent young people to pick up that slack. So coaching is now working with those younger people to get those tools in place.
a huge thing for an entrepreneur to embrace.
Internal conflicts OBE: How often will a person say they want something, perhaps to
DH: A specific example is the senior make a million dollars, but as you
First time OBE: What do people ask you the first time they approach you as a business coach?
BB: What I see the most is the business owner has been working and has a modestly successful business and it is just there. They’ve had two or three years of exactly the same growth or sales. They’ve plateaued and they just don’t know how to get past that, to the next level.
DH: What happens is often I’ll get a phone call and they’ll say, ‘We really need team building.’ That’s probably eight out of 10 response. And as coaches we know that team building’s not the answer. It’s likely conflict resolution. JS: I got an inquiry right now from the Internet, a fellow in Edmonton. He told me, ‘I set my sights on a career and I’ve accomplished it. I set my sights too low. ‘L-O-W with an exclamation point. I want to go further. Can you help me?’ Very typical.
BB: There’s absolutely nothing wrong with having a modest business that creates a decent lifestyle. We’re not saying everyone has to be a type ‘A’ personality that’s hard driving. That’s not for us to say, but for those people who do want to get there, it’s like a proathlete. If a talented athlete wants to take it to the next level, their first step is to hire a coach. Someone who can guide them through that process. And business owners are no different. Where they can help OBE: Give me some specific examples where people can benefit from coaching.
BB: There’s all the people working towards getting their businesses ready to sell, to try and get a better price for it. With a little bit of work over three to six months you can really turn a financial statement into something that’s really saleable. Or business owners who are looking to pass their business on to their kid will, typically, always look at their child as being 16 and incompetent even if the child is now 45 and Dad’s 75.
manager who is looking outwards at where the issues are, at where the problems are. The reality is that a large percentage of those people need to be looking inside, not outwardly and pointing fingers. They are always looking for whose fault is this? And they’re never looking at themselves to see how did this arise in the first place.
JS: To tag onto that, the person who looks inside and says, ‘What’s wrong with me?’ and only says that – there’s a coaching opportunity there. A huge one. One of the most common tape recordings people carry is: ‘I’m not good enough.’ We have tools to deal with that little voice.
DH: The classic scenario is when they start in that garage and then they build the full time company and they have maybe four or five employees, it’s the coaches helping to let go of those things they’ve had for so long. To trust to delegate. They’ve got others doing it, but they don’t trust. They’re micromanaging.
JS: Working with a senior executive who expressed a desire to improve delegation skills and so I asked her a few questions about her daily routine. She was visiting every project three times a day. That is not delegating. So I asked her, ‘In those meetings you have every day how often do you find that you have to save the day?’ She said, ‘Oh, almost all the time.’
OBE: But how do you help them bridge the gap between doing it all and the belief that if they don’t do it, the company will fail?
BB: You have to encourage them to take a tiny step in letting go and then coming back and reaffirming that it went okay. As a coach that’s what we do. ‘You said last week you were going to let that person take care of it and then come back and see how it went. How did that go?’ ‘Yeah, that went fine.’ ‘Right, now let’s try that again on a slightly larger scale.’
JS: I’ve coached a few people where the conclusion was they needed to hire themselves a president to run the company. That’s
explore the issues, you realize that isn’t what they want.
DH: There’s been books written about that. I’d say that 60 or 70% of people are not really aligned with their true goals. So it is the job of the coach to help them realign that position.
BB: And not just at the beginning. That’s something I find I have to remind my clients constantly. You said your goal was this, once we’ve established the true goal at the beginning, and yet you’re making a decision that is going way over here. That’s okay, but just let me point out that that is happening and maybe you want to bring that decision back on to the centre goal. That constant monitoring and pointing out is part of what we do as well.
DH: I have a client who said his
Okanagan Business Examiner
goal was to improve marketing, but he spent five hours taking a piece of machinery to another factory. In reality anyone could have driven that tractor out of town to get that done over there. So when that was pointed out to him there was an ‘aha’ moment, ‘I guess I’m not really going for that goal.’
BB: I think there is a perception out there that they would be hiring a life coach and that we would come in, sing Kumbaya, you know, burn incense in their office and try to calm them down with soft, mellow music and that’s just not what it is. Business coaching is much more practical than that. The end of things OBE: This brings us to another question: is there an endpoint? When do they not need the coach any longer? BB: My feeling is if I do my job correctly, yes, there is an endpoint. And it can be anywhere from six months to two years. JS: When you work with people a shift starts to happen. But you have to stay with them a little longer because, if a freight train comes through the door, they will revert to what they’ve known before. You
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have to work with them until that habit becomes the place they fall [back] to when the freight train comes through the door.
DH: Very good question. There are different reasons for them getting to the end. One can be met objectives; another one can be they’ve absorbed all the development they can at this point in time. I think there are two types of coaching being talked about here. One is objective based, and the other is development based. And we all have different sorts of contracts if you like, for coaching. I usually begin with a three month contract and almost invariably, it’s renewed.
BB: What you don’t want to create is a co-dependent relationship. You don’t want to create it where they need you to come in every week otherwise they start to become all nervous and edgy. That’s not good either.
JS: The coach is constantly working towards working themselves out of a job.
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June 2009
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to improving your game How to become a better golfer through proper preparation Planning to arrive forty minutes before your tee time may be unrealistic for some, but it is necessary to provide the best opportunity to play to your ultimate potential. • Spend the first couple of minutes hitting 25-35 yard chip shots. This will allow muscles to loosen and create increased blood flow throughout your body. • Once comfortable and relaxed, then take the time to go through a series of different stretches that will target your back, shoulders/upper arms, core and lower body. Start slow with your stretches and increase slightly as your body continues to warm up. • Once the body is prepared to make a proper golf swing always start with your highest lofted club. This will continue to allow yourself to gain flexibility and confidence early in the warm up. Make up games or types of shots to keep the warm up challenging yet rewarding. • Gradually work your way down through your clubs (depending on time) ultimately finishing with your driver. By now, you have given yourself ample time to relax, stretch and gain confidence in your swing and the last 10-15% of the range balls can be utilized to your maximum potential with the driver. • After your practice/preparation on the driving range, find an appropriate green and take the time to work on your flop shot, chip and roll as well as your putting stroke. Getting comfortable with the speed of the greens, especially if it is not your home course, as well as fine tuning these touch shots can be extremely valuable for your success on the golf course. John Swanson is a Canadian Professional Golfers’ Association (CPGA) member and the Director of Golf at the Nk’Mip Canyon Desert Golf Course in Oliver.
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June 2009
Okanagan Business Examiner
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The VWIB’s Colleen Barker says eBlasts are more efficient for her membership and provides some revenue for the group.
Slow train to eBlastville Story and Photo By Deanna Brooks Despite fears to the contrary eBlasts are not a new form of spam that is going invade your computer and overwhelm your inbox; although eBlasts are a form of online flyer that business communities in the Okanagan, like the Vernon and Penticton Chambers of Commerce and Vernon Women in Business (VWIB) are beginning to embrace. What sets them apart from regular e-mail, and spam, is the list of potential receivers; members who willingly receive them alongside regular group communications like newsletters. For small businesses, which are not part of an established business community, that old standby, Canada Post, remains the more popular choice. Canada Post statistics state that in 2007 79% of Canadians said they preferred to receive general business correspondence by mail, and that 67% also preferred to receive advertising by mail, in contrast to the 18% who preferred e-mail, the 1% who preferred telephone and the 8% who preferred other means. Lillian Au, based in the Vancouver offices of Canada Post, says people still prefer the “tactile” experience of handling eye catching flyers over receiving e-mail. Direct mail, Au says, has proven to be an “old workhorse” for Canada Post. In 2008, Au states, direct mail saw a 0.9% volume increase and brought in a 2.5% revenue increase.
compiling and keeping a traditional mailing list is better spent on design and timing of their marketing, and, for the VWI,B eBlasts generate revenue. There are no print costs and, for that reason, eBlasts are also green-friendly. Colleen Barker, the VWIB’s Director of Membership, says the decision to use eBlasts came last fall after the VWIB decided to construct and run their own website. Barker says that the Vernon Chamber of Commerce was a great example and that the eBlasts gave them an opportunity to offset the cost of setting up the website. The Vernon Chamber of Commerce has been sending out their eBlasts for about two years. They have become “very popular” states Val Trevis, executive director of the Chamber. She says, “It’s a member-only service.” She says the Chamber sets limits on content and frequency to only three per week. Compared to Canada Post, eBlasts are much quicker, taking one day as opposed to the three needed for local mail. Also VWIB can tailor the costs based on what their members are willing to pay.
When trying to reach out to new, unknown customers the post still has some real advantages. For smaller local businesses, Canada Post’s online services allows business owners or marketing managers to custom select a mailing list and provides a number of options for contacting customers and/or other businesses, including addressed or non addressed direct mail, and the ability to send free samples out to potential customers or business partners.
Barker says VWIB was concerned about overwhelming their members and have set a “one a day limit” for eBlasts. Although they have only been sending out eBlasts since January, Barker says, “We haven’t received any negative feedback from our members,” and they have become a great way to send “internal messages” to all our members. For members who wish to send out their own eBlast, Barker continues, the process is much simpler than it was to send out physical notices. Before members had no access to the mailing list and they had to apply to a board. Now they design their own pdf and apply online.
Where eBlasts are becoming an effective and affordable communication tool is within online communities, like VWIB. For members of such communities, the time and effort spent in
As online communities grow so too will the use of eBlasts, but businesses and consumers do not have to be concerned about overflowing numbers coming their way. At least not yet.
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June 2009
The Underground Economy Reprinted from the Midwest Mirror – Chicago, Ill. The workers wait on their usual street corner here in Middle America. Homeowners cruise past, eying the lineup of illegals. Every day these workers stream across the seemingly open border, crossing open fields, rivers, always on the lookout for the Border Patrol. They do the jobs Americans either don’t want or are no good at. Jobs that are back breaking. Jobs that have no scheduled breaks of any kind, not even lunch. No unions support these people – they work for cold cash. Nobody fights for better conditions or a contract for higher wages. They carry only the clothes on their backs, and the tool of their trade. Snow shovels. Yes, these are the migrant snow shovelers from Canada, a land of unsurpassed beauty, rugged individualism, and gobs of snow.
As the Arctic lows from the north spread far and wide, so too do the itinerant workers. Shivering southward in November and December, these illegal aliens are easy to spot by authorities. They sport blue lips, goofy looking wool coats in red or green plaid, and snow hats they call toques (rhymes with Lukes. We were told it is not pronounced “ski hat”). They carry snowshoes on their backs, always prepared. Enormous mittens, some with strings up their sleeves, round out their attire. And they chew on the rims of their paper coffee cups and look underneath. Why? No one knows. They speak a strange dialect, when they talk at all. Hard to understand what language it is. “Shovel-yer-driveway-mister?” they say in their foreign tongue. “S’onlyten-bucks-for-a-driveway-or-twennyfor-the-sidewalks-too”. Our newspaper investigative team wanted to learn more about this lifestyle and these people so we spoke with one of the fellows who
looked like he was in charge. His name was Lloyd Robertson. “So – been doing this kind of work long Lloyd?” I asked slowly, hoping he understood. “Oh-ya-we-been-comin-down-herefor-a-long-time-now-eh,” he said in his nearly indecipherable lingo. The more I listened to him talking, the more it occurred to me he was speaking a form of English! It was clipped and crisp and hard to understand at first, but there it was – English! It finally occurred to me where I’d heard that dialect before: Peter Jennings. “Why do you come here? And what do you say to all the 10-year-old American boys whose jobs you are taking?” “Well, sorry, but we’ve got no other choice but to sneak over here and hopefully not get caught because we are desperate. We have families back home that are counting on us and we need this income and currency exchange. At least until the
hockey pools pay off. We don’t stay long on account of the beer and all. Sorry.” “Plus we can smoke pretty much everybody at road hockey. We haven’t had this much fun since we burned down the White House in 1814. No offense of course. Sorry.” Very polite these people. The migration patterns and tactics are becoming familiar to authorities. Officer Fred Johnson of the U.S. Border Patrol: “In spring, as warm weather moves north, Mexican labourers move with it to pick fruit, harvest crops and do summer yard work. In the fall, the wave of illegal migration reverses, and Canadians flood across the border, hot on the trail of the Mexicans, shoveling as they go.” “We pick up this pattern when sales of doughnuts start to rise,” says Officer Johnson. “There are other tracking methods too. Cashiers report people asking for “Double doubles, and the trail of KitKat candy bar wrappers is also fairly
distinctive. We don’t have those down here. Tasty.” And so they go – these itinerant labourers who carry the load for us Americans, and who put an extra ‘u’ in their ‘or’-ending words. Are they a burden to society who should be deported without pause? Or should we embrace these illegals for what they can do for our economy and lifestyle, not to mention our hockey teams where we could use a ringer or two? Until Rush weighs in with an opinion we can work with, we’ll just have to wait and see. David Crawford has won several accolades for his humour writing, most recently winning the ‘Humor and Life, in Particular’ contest in the U.S. During the day he is the head of Capri Intercity Leasing. On weekends, he donates his kidneys to worthy causes, most recently Nelson Mandela. He can be contacted at 250-718-2244. His humour columns are available on his blog at www. occaisionalhumourist.blogspot.com
June 2009
Okanagan Business Examiner
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Is fuel theft OK? Do you accept theft in your company? This may seem like a silly question, but let me explain. Let’s look at a small construction company for example. Over the years the business has grown from a friendly partnership to a thriving enterprise managing millions of dollars in annual projects. At first it was no big deal for the boys to help themselves to some materials or even fuel. The occasional fill up on the company was viewed as an employee perk and part of the cost of doing business. As business grew and more staff were added new policies took over. It was no longer acceptable for fuel to be taken by employees, but it didn’t stop. Old habits die hard, entitlement lives on and it’s always been easier to turn a blind eye. Regardless of how you justify it – as waste, spillage, shrinkage or a perk – it is still theft.
Fuel theft costs companies hundreds of thousands of dollars. In a recent issue of Truck News Magazine, one company reported tens of thousands of litres in diesel fuel stolen over only a few weeks. The thieves had carefully planned their robberies, with electric pumps, a generator and large plastic fuel tanks. They drove off with thousands of litres of fuel three separate times – their haul valued at $18,000, $27,000 and $50,000! Whether it’s your staff casually helping themselves to your fuel or organized thieves stealing fuel to re-sell it – it’s a problem. But it’s not beyond your control. The first situation is more common than you may want to admit. Sure, some fuel goes missing but it’s not huge so you write it off. When it’s stolen in bulk, the police are notified and you beef up security. The one situation is really not any different
Alan W. Phillips
than the other. In most cases, they add up to the same over time. Look at it this way: every dollar spent on fuel should provide a return on investment. You can actually calculate that return if you track your fuel consumption. Track your fuel accurately and theft will disappear. Total Fuel Management (TFM) is a concept that can help you to eliminate theft, increase accountability and minimize other risks associated with refuelling. Its greatest benefit is helping you to measure the return on your fuel investment. A complete TFM system includes proven software that allows you to set operating thresholds for each machine and you quickly see where the most fuel is being used, or wasted. Once you have that you can manage your people, and your fuel better. Fuel theft is history. It
Remote tank monitoring also has other benefits. Each fill up is measured to the exact amount along with a date and time stamp. Positive identification of equipment and vehicles work in tandem to give you exact refuelling information by piece of equipment so you can
PTSD or Post Traumatic Stress Disorder is a severe and ongoing, persistent emotional reaction to an incident. It is a type of anxiety that affects 1 in 10 people and usually requires treatment. We offer a 12 session program which focuses on helping people overcome their traumatic symptoms.
gauge efficiency and productivity. Data capture software at point of refuelling streamlines your accounting too with instant accurate data for simple reconciliation. For multi-location users all this information can be delivered to one office via e-mail. Fuel theft is a problem and until you can measure each refuelling you will continue to pay for losses every month. For many companies, fuel is the second largest cost next to labour, so you must pay attention to even the slightest fuel theft. 4Refuel Ltd., is the leader in fuel Management. Jack Lee is CEO of 4Refuel – the largest onsite fuel management company in Canada and a global leader in technology designed to help businesses reduce their fuel expenses. Got a question about fuel? Ask the fuel expert by emailing Jack at AskTheFuelExpert@4Refuel.com
Michael Dias
Stress Management Specialist
Q A
If you use your own fuel storage tanks TFM takes fuel tank monitoring to the next level. Remote tank monitoring and prevention devices are attached that advise managers when a theft occurs. Fuel tanks are equipped with digital software that is activated each time the tank is open. An alert text message or e-mail lets you know when each refuelling happens. In addition each fuel tank can have an alarm attached that activates if there are any after-hours or unauthorized fill-ups.
RCC
Recently I was injured in a serious car accident and I almost died. Pictures of the accident keep popping into my mind and they scare me so much my heart starts pounding. My doctor said I have PTSD. What does this mean?
is not impossible to cut refuelling expenses by 15% or more.
Owner
Q A
Does my Virus scanner scan everything by itself.
Most of the time the default setting on Virus scanners are set for a quick type scan, which means, it does half the job so your computer doesn’t take as much resources and time. You should always go into your virus scanner and tell the scanner to do a manual scan at least once a week and if you do that you should have no problems with viruses and spyware.
“Promoting good mental health & ensuring emotional wellness”
107 - 3640 Gosset Road, Westbank, BC
250.491.4684 www.stresslessspecialist.com
250.707.1153 www.discoverycomputers.com
A s k t he Pr o f e s s i o n a l s To be included in next month’s professionals call: Chytra @ 250.863.4636
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June 2009
Okanagan GM and Chrysler
dealerships
Okanagan General Motors dealerships:
Bob Brown Pontiac Buick GMC Ltd. - Penticton Sentes Chevrolet Ltd. - Penticton
Don Folk Chevrolet Oldsmobile Inc. - Kelowna
With the bankruptcy of General Motors and, in the United States, Chrysler, the inevitable dealership cuts were first on everyone’s mind in the aftermath. Since Chrysler did not go into bankruptcy in Canada it has been business as usual for those dealers. General Motors however did declare bankruptcy in Canada as well as the U.S. and declared that 245 dealerships in this country would be closed. That is just over a third (34%) of Canada’s 709 currently operating dealers. The auto maker did not make public the list of dealerships that would be shut down leaving dealer owners and their staff to wait for the letter from head office confirming a shut down or continued operations.
Jacobsen Pontiac Buick Ltd. - Kelowna Saturn of Kelowna
Bannister Chevrolet Inc. - Vernon Walthers Pontiac Buick GMC Ltd. - Vernon Salmon Arm Chevrolet Pontiac Buick GMC Ltd. Chrysler dealerships:
The news for local dealers from Salmon Arm to Penticton was as good as could be – all received the letter telling them that their dealership is safe and will continue to operate as normal. The only obvious change may be the changing of names as General Motors has eliminated the Oldsmobile and Pontiac brands.
Braby Motors Ltd. - Salmon Arm
The only question remaining in the short term is for Saturn of Kelowna. General Motors has a tentative deal to sell the Saturn brand to Roger Penske, owner of the Penske Automotive Group, the second largest private car dealership network in the U.S. Penske says that he has no plans to close any of the 350 existing Saturn dealerships. GM has agreed under the tentative deal to continue manufacturing Saturns for two years while Penske finds another auto manufacturer to produce the Saturn brand.
Kelowna Chrysler Dodge Jeep
TD CANADA TRUST SMALL BUSINESS ADVISOR We’d like to introduce Debra Lehune as your Small Business Advisor. With over 25 years of business banking experience, Debra understands the pressures of owning and operating a business and is committed to helping you by: • discussing your business banking needs • offering professional banking and investment solutions • delivering excellent personal service Drop by the branch to talk to your Small Business Advisor and discover how we can make your business banking easier. We look forward to seeing you soon.
390 Main St. Penticton (250) 770-2300 debra.lehune@td.com Monday to Wednesday Thursday & Friday Saturday
8 a.m. – 6 p.m. 8 a.m. – 8 p.m. 8 a.m. – 4 p.m.
Vernon Chrysler Dodge Ltd. Okanagan Chrysler Jeep Dodge - Kelowna Parker’s Chrysler Dodge Jeep Ltd. - Penticton
Consumers are being careful in a tough economy Buying decisions related to home construction and renovation and the automobile industry are being well researched by consumers, according to the latest numbers from the Better Business Bureau. The president of the BBB of Mainland BC, Lynda Pasacreta says,“We receive about 50-thousand inquiries a month, the majority of those are pre-purchase and a good number are about where we live or what we drive.”
A review of the top ten inquiries in April this year shows significant activity, in the construction trades, and auto industry, with moving companies often at the top of the list.
Top 10 Inquiries:
Top 10 Complaints:
1. Movers 2. Roofing contractors 3. Plumbers 4. Automobile dealers – new cars 5. Automobile dealers – used cars 6. Painters 7. Renovation contractors 8. Automobile repair and service 9. Landscape contractors 10. General contractors
1. Telephone service – local 2. Automobile dealers 3. Stereo systems dealers 4. Automobile brokers 5. Cellular telephones 6. Movers 7. Furniture dealers 8. Roofing contractors 9. Health clubs 10. Cell service/supplies
On the complaint side of the equation consumers continue to be concerned about three main areas: product quality, failure to deliver on a promised product or service, and misrepresentation. “Many families are feeling the money squeeze right now and are doing a lot of homework before hiring a company, because they want it done right the first time,” suggests Pasacreta. In this tough economy it is natural that consumers are looking for more information, more often before making their purchases. Pasacreta explains, “The BBB provides information on accredited and non-accredited companies complete with an ‘A+’ to ‘F’ letter grade to give consumers help in making those buying decisions.” Kevin Rothwell is the accreditation and communications representative for the Mainland BC Better Business Bureau in the Okanagan. You can reach him at kevin@mbc.bbb.org and view information on the BBB at www.bbb.org
June 2009
Jordan Tetreau of Royal LePage’s Mint Property Group believes the next 12 months will provide the best buying opportunities of the last decade as hungry developers and a few foreclosures force prices downward. Photo by Devon Brooks
Silk linings in a sinking real estate market By Devon Brooks On May 29, an Associated Press story out of the United States reported “many analysts believe activity isn’t shrinking nearly as much now as the downturn flashes signs of letting up.” The story was titled U.S. economic slump eases, but that call may be a tad premature. The easing was based on first quarter of economic data that showed the contraction of the U.S. GDP, initially pegged at 6.1% had been revised to 5.7%. (Similarly, Canada’s actual first quarter contraction of 5.4% wasn’t as bad as the expected 6.7%.) Unfortunately, during that same first quarter, real estate in the U.S. continued to fall off a cliff. Home prices were down 32.2% from their peak in the spring of 2006, which puts them down at 2002 prices. They fell 19% in the first quarter of this year, the worst number ever recorded since the Case-Shiller National Home Price index was inaugurated in 1988. Moreover crumbling real estate prices that were previously confined to the tourist sunbelt states of Nevada, Florida, Arizona and California are now spreading across
the rest of the country. That’s being driven by unemployment, which stood at 8.9% in April. It is projected to hit the 10% mark later this year, for the first time since 1983. As unemployment spreads so will mortgage difficulties. The problems are not confined to the United States. Jordan Tetreau is a Kelowna realtor working with the Mint Property Group, a division of Royal LePage set up to work with opportunities provided by a declining market. Talking about the local situation, he says, “There are some mortgage foreclosures. I can think of half a dozen in the last three or four months, but it was the early ‘90s the last time there was a significant number on the market.” The British Columbia numbers are not nearly as bad as in the U.S., but predicting where numbers will go is extremely difficult at best because there are so many variables, any of which can throw the assessment out. Consider Jim Flaherty’s deficit predictions, which went from “unthinkable” before the 2008 election to $50 billion last month. Similar to the economic projections, where reality was a little nicer
than earlier predictions, the British Columbia Real Estate Association (BCREA) is cheered because its earlier forecast of a 13% drop in B.C.‘s residential prices for 2009 has been revised to only 8%. Cameron Muir, the BCREA’s chief economist, optimistically predicts, “The majority of the decline in home prices has already occurred.” Which is not the same thing as saying that the declines are over. Tetreau says, “We will be well into 2010 before we see a recovery.” The BCREA’s projected percentage drop is for the province as a whole. Broken down by region the extreme north fares best with a predicted drop of only 4% in 2009. The worst hit regions are the Okanagan and Similkameen where prices are expected to go down 15% this year. The central and north Okanagan will see average home prices of $345,000 by the start of 2010, down from the 2008 average of $406,647. The south will see prices drop to $290,000 from $339,394. The reason for our steeper price drops is prevalent across the entire Okanagan. Tetreau says, CONTINUED ON PAGE 20
Okanagan Business Examiner
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These are shots of a new condominium that has taken a 20% discount to see if that will move it through the current market’s skeptical buyers. Photo contributed
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Trade-Marks Industrial Designs
Trade Secrets
& Technology Transfer
Copyright
Patents
PRACTICE RESTRICTED TO INTELLECTUAL PROPERTY LAW L A W C O R P O R AT I O N R E G I S T E R E D P AT E N T & T R A D E -M A R K A G E N T P H O N E : (250) 418-3250 F A X : (250) 418-3251 T O L L F R E E : 1-877-943-9990 E-M AIL : gordonthomson@shaw.ca
“Proportionally, Vernon, Penticton and Kelowna are all overbuilt to about the same extent.” That’s why the Royal LePage group set up the Mint Property Group. Tetreau describes how the group is operating: “Our approach is to go to the developer and ask if there is a part of the product they can offer at a deep discount so that the buyers could feel that it’s a good deal even if the market declines more.” Tetreau cites one example: a 1,053 sq. ft. 2-bedroom condominium priced by the developer at $265,900 is listed on Mint for $212,720. Most, but not all, of those opportunities at the moment are in the condominium sector, which has been substantially overbuilt. In a letter to one of his clients, Tetreau wrote: “As of April 2009 there are nearly 1,100 condos for sale through MLS, which doesn’t include developer inventory available through in-house sales programs. With only 64 condo sales in the entire Okanagan Mainline Real Estate Board in April 2009, this equates to approximately 17 months worth of condo inventory on MLS alone. In addition to MLS, we estimate there to be over 350 condos available directly from developers and a further 400+ proposed to be released in the
next 6-8 months as pre-sales and re-sales.” Asked if he feels the Mint Property Group would even exist if it weren’t for this market, Tetreau says, “Probably not.” The continuing bad news from the United States has an impact, even if it is mostly psychological. Tetreau explains, “Bad news in the U.S. affects buyer confidence so end-user buyers here are being very calculating and careful.” That means a lot of tires are being kicked, but not as many are bought. Tetreau observes, “Developers are seeing a lot of visitors, but not many transactions.” The caution is showing up in other ways too. While condominiums are hard hit, so too is recreational property. For example, says Tetreau, “There is very little movement at Big White.” The news also has some good repercussions for the region. It was only five years ago that Kelowna was billing itself as one the most inexpensive places for businesses to come and set up shop. Real estate coupled with the rising dollar helped to kill that. The slump in real estate will help address the issue of affordability
and the record rental crunch that was plaguing most Okanagan communities because, says Tetreau, “A log of buyers who bought units on spec for a quick flip are now looking for renters.” With the decline in the economy there are also fewer outsiders buying in the region. Without outside money there simply isn’t enough cash to sustain the current prices with even more units coming onto the market. This will help more with making housing affordable than all the programs discussed by government. Asked about the psychology of decreasing prices, and whether buyers will keep postponing because they hope for a lower price next month Tetreau explains the risk they run. “The tricky thing for the consumer waiting for the bottom is we never know when we will hit bottom.” Eventually the Mint Property Group will be worked out of existence because a strong market will end the opportunity it was built to exploit. But not yet. Concludes Tetreau, “We will be strong for at least another year. We will continue to see some downward pressure.”
June 2009
Okanagan Business Examiner
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Legal Talk
Employees and a culture of customer service Employment lawyers have the opportunity to hear many employers’ complaints about the performance and conduct of their employees. Often in the context of building a case for just cause (for summary dismissal), poor treatment of customers is a frequent topic of discussion. Customer service is the window through which customers view a company. Not surprisingly, poor service is one of the chief
complaints of customers. It comes in all shapes and sizes and can sour a relationship to the point where the customer moves on to obtain goods or services elsewhere. A recent study reported that half of all shoppers polled report multiple customer service problems during any given shopping trip. In my own experience, there are three versions of poor customer service particularly likely to jeopardize the relationship.
Robert O. Levin L AW O F F I C E
The first involves the employee blaming the customer for whatever the issue happens to be. To be sure, there are occasions when the customer is at fault, but the tendency to jump to the conclusion that the customer has done something incorrectly can be particularly annoying. I recall getting on an aircraft in Victoria a few years ago, having earlier checked in and received my ticket. As I boarded, I showed my
ticket to the flight attendant. She frowned and told me there was no seat for me (it seems that two tickets had been issued with the same seat number). That was irritating in and of itself, but it’s what happened next that really left a bad taste. She started to say, “The problem is that you…”. Quickly sensing where this was going, I cut her off and emphasized that I had done nothing
other than walk up to the airline’s check in counter and receive a ticket. It was their job, not mine, to ensure that the ticket I received had a valid seat number. That’s an example of the employee attempting, inappropriately, to off-load responsibility onto the customer. In my book, that’s a definite customer service defect. It’s amazing how these unpleasant encounters stick in CONTINUED ON PAGE 22
BENSON SALLOUM WATTS LLP L A W Y E R S
Real Estate Law | Business Law | Litigation Injury Law | Aboriginal Law
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Member: BC Trial Lawyers Association
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607-1708 Dolphin Avenue Kelowna V1Y 9S4 (Landmark 2 Building)
www . rlevin . com
Wesley C. Shields
Heidi Taylor
250-869-6017
250-869-6014
B.A. (Hons), M.P.A., L.L.B.
Benson Salloum Watts is pleased to welcome Robert MacLeod to the firm. Robert joined us on April 1, 2009 as an Associate. Robert's practice is focused on the areas of Commercial Litigation and Personal Injury Law. Robert MacLeod moved to our West Kelowna location on May 01, 2009
To contact him call 250.769.4949 or rmacleod@bensonsalloumwatts.com 270 Highway 33 West Kelowna, BC V1X 1X7 Ph: (250) 491.0206 Fax: (250) 491.0266
200-1455 Ellis Street Kelowna, BC V1Y 2A3 Ph: (250) 861.5678 Fax: (250) 861.5642
Estates Square - 102A 1979 Old Okanagan Hwy. Westbank, BC V4T 3A4 Ph: (250) 769.4949 Fax: (250) 769.7070
www.bensonsalloumwatts.com
B.A., L.L.B.
- Commercial Litigation - Family Law - Land Development - Estate Litigation 2nd Floor, 215 Lawrence Avenue, Kelowna, BC Phone 250-762-4222 . Fax 250-762-8616 www.fhplawyers.com wshields@fhplawyers.com . htaylor@fhplawyers.com
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the memory of the consumer. I can’t remember why I was in Victoria on that occasion or anything else about the trip, but I clearly recall the episode with the flight attendant. My second grievance involves the employee, rather than taking responsibility for a problem, simply handing the customer off to someone else. It happens to me all the time in department stores in particular. I also had a recent experience to that effect here in Kelowna. We had been having ongoing problems getting an expensive job completed properly in our home. I was working slowly through the process of attempting to get the problem fixed. Just getting in contact with the company’s representatives by telephone was a challenge. When I finally reached a representative of the business to explain one particular portion of the problem, the response I got was, “Oh, that’s for Jack to take care of.’ Rather than assuring me he would promptly track down Jack to have him take care of the issue, he left it in my hands to locate the other employee and achieve the desired resolution. What that told me was that the
June 2009
employee considered his own time to be more valuable than mine. Another definite customer service flaw, in my view. The third thing that I experience time and time again is employees who simply don’t take their customers’ issues seriously. In the face of unsatisfied customers, they take a blasé approach and brush off customer concerns. It’s one thing to calmly assure your customers that their issue will be addressed. It is another thing to demonstrate total apathy about the problem. The way for companies to overcome these issues is through training and indoctrination of employees. The basics of customer service can be trained - even the most ill-mannered person can be taught how to deal civilly and respectfully with the clients of the business. The indoctrination element relates to making the employees feel a part of the company’s culture as it relates to customer service. It’s about teaching employees that every contact they have with a client makes up the totality of how the company is viewed by the general public. One Canadian airline (not the one I had the encounter with in Victoria) seems to have done an extremely good job of this.
The truth is that many customers will stick with a company that has only average products if they are treated well and provided with effective service. The entire fast-food business, for example, has survived on the strength of the premise that fair-to-middling food can be sold to people who value service and speed. The ones that have been highly successful have demonstrated an understanding that repetitive training and indoctrination are the keys to consistently good customer service. That can result in employees who demonstrate great customer service by saying things like, “Mr. Smithson, we’ll address that right away and I’m going to personally ensure it’s done to your satisfaction.”
Robert Smithson is a partner at Pushor Mitchell LLP in Kelowna practicing exclusively in the area of labour and employment law. For more information log onto www. pushormitchell.com. If you have a labour or employment question for him e-mail him at smithson@ pushormitchell.com. This subject matter is provided for general informational purposes only and is not intended to be relied upon as legal advice.
Children of the Okanagan 2009: Raising money for children’s care at KGH One of the Okanagan’s premier portrait photographers, Elizabeth Soergel is using her talents to raise money for the children’s ward at Kelowna General Hospital. Her project is Children of the Okanagan 2009, a beautiful coffee table book filled with images of children, photographed on location throughout the Okanagan. “We will be waiving our regular $200 portrait sitting fee and instead asking the parent or guardian to make a $100 donation to KGH Foundation for every child that appears in the book,” says Soergel. Portrait sessions will be held throughout the spring and summer to take advantage of the best weather. The session will focus on the child, but arrangements can be made for family portraits. Parents will be able to view the images and choose the one to include in the book. Portraits can also be purchased individually. “Kelowna General Hospital Foundation is very excited to be working with Elizabeth Soergel Photography on her unique fundraising initiative,” says Sarah Nelems, KGH Foundation’s Executive Director. “We are delighted to be the beneficiary of this very special fundraiser.” “Inspiration for this project came from our beautiful daughter Lauren” says Soergel. “She needed neo natal care just after delivery. We wanted to give back so that we can be sure other newborns needing specialized care will be able to receive it.” The book release date is set for December 2009, and 50% of all sales will also be donated to the KGH Foundation. Find out more about the project at www.okanaganphotographer.com or call 250.317.4395. Soergel encourages interested parents and grandparents to contact the studio as soon as possible to reserve a page, as space is limited.
June 2009
Okanagan Business Examiner
Calendar of Events Conference on the EU Canada Relationship Jun 15 - Morris Wosk Centre, Vancouver This conference, sponsored by the EU, is to inform and engage the business community in western Canada on “the longstanding relationship between the European Union and Canada.” It is all the more relevant in light of talks on a trade deal between this country and the EU. No cost to attend but participants must register by calling 604-682-1410 or by going online to www.iccbc.com
2009 Planner’s Breakfast Jun 17 - Prestige Hotel, Vernon The Vernon Chamber of Commerce’ annual breakfast meeting, from 7:30 to 9 am, with the planners from the City of Vernon, the District of Coldstream and the North Okanagan Regional District. To register contact the Chamber at 250-545-0771.
Evening Meeting of VWIB Jun 17 - Best Western Vernon Lodge The monthly evening meeting of the Vernon Women in Business group running from 5 to 7 pm. For more information go to http://vwib.com or e-mail: meetings@vwib.com. $14 for members; $16 for non-members.
Business after Business Networking Event - Jun 18 - Kettle Valley Station Pub, Penticton This is one of the Penticton Chamber of Commerce’ networking events running from 5 to 7 pm at the Kettle Valley Station Pub patio. Free to Chamber of Commerce members, $20 otherwise.
Business After Hours Jun 18 - Mission Hill Family Estate Winery, West Kelowna The Kelowna Chamber of Commerce monthly networking event from 5 to 7 pm. $7 for members, $12 for nonmembers.
FoodSafe Course Jun 19 - Penticton & Wine Country Visitor Centre Valentine Young is teaching FoodSafe Level 1 course starting at 8:40 am. To register call Val at 250490-9300. $50
Intellectual Property Jun 19 - Small Business Video Conference This three-hour seminar from 9 am to noon will educate you on how to protect your business brand and on who owns your intellectual property (IP). The seminar looks at IP registration procedures, the cost and what to do if someone is infringing your property. This seminar is hosted at Small Business BC in Vancouver. $39 + tax. Register online at www.smallbizeducation.ca/videoconferencing/penticton.php
Getting Incorporated Jun 19 - Small Business Video Conference
family. This seminar is hosted at Small Business BC in Vancouver. $20 + tax. Register online at www. smallbizeducation.ca/videoconferencing/penticton.php
Business After Hours Jun 25 - Cove Lakeside Resort, West Kelowna The Westbank Chamber of Commerce’ monthly networking event from 5 to 7 pm. No cost for members; $5 otherwise. RSVP required – call 250-768-3378
Tom Christensen Tribute Jun 26 - Best Western Lodge Vernon Tom Christensen is the recently retired two-time MLA for the Vernon area. A tribute and roast of Christensen will run from 6 to 10 pm with proceeds split between the Greater Vernon Chamber of Commerce and Junction Literacy. Call 250-545-0771 to register.
Business After Hours Sep 17 - Pushor Mitchell LLP office, Kelowna
registration before Sept. 14, $325 thereafter.
The Kelowna Chamber of Commerce monthly networking event from 5 to 7 pm. $7 for members, $12 for nonmembers.
Effective Group Leadership Program - Oct 5-8 Naramata Centre
Vision 2020 Business Conference & Tradeshow Sep 22-23 - Penticton Trade & Convention Centre
This two-part program develops the skills and effectiveness of small group leaders. Registration and more information available by calling 250-496-5751, ext. 200. Cost: $1,250.
This is the inaugural run of an annual conference designed to help business thrive in the short term while planning for the long term. Talks and workshops will cover off branding, IT, social media, management consulting, HR, business finance, business enhancement, information management, doing business with First Nations and selling. The show will be populated with local business experts and well-known figures like Premier Campbell. Go to www.vision-2020.biz. $295 for a full
A three-hour seminar running from 1 to 4 pm to inform you on how to get incorporated with legal tips to help you once you’re incorporated. The seminar also has segments on the advantages of incorporation and the roles played by shareholders, directors, officers. This seminar is hosted at Small Business BC in Vancouver. $35 + tax. Register online at www.smallbizeducation. ca/video-conferencing/penticton. php
Downtown Vernon Sunshine Festival Jun 20 - Downtown Vernon This is the largest street fair in the north Okanagan, with an expected attendance of 12,000. Runs along 30th Avenue. For information contact the Downtown Vernon Association at 250-542-5851. Cost: free.
The Entrepreneurial Mom Jun 24 - Small Business Video Conference This four-hour seminar running from 10 am to 4 pm gives information on how a home-based business can work for a mother and her
The Royal Astronomical Society of Canada, Okanagan Centre is building the first Observatory of its kind in the Okanagan. It is sure to be enjoyed by members of the community and tourists alike. The Royal Astronomical Society is currently accepting donations from the business community. We need your help and appreciate your support. Please contact:
Grant Rice, ridebike@okanagan.net www.okanaganobservatory.ca
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o y h p C p waters Navigating the waters of the global economy got rough last winter, and most participants headed for safe harbours in December and January. Banks stopped lending as their wellspring of free money, collateralized debt, dried up. Inter bank lending halted and slowed the flow of credit further. Some of the banks failed, and some survived only with the aid of government support. Canada turned out to have one of the world’s strongest banking systems. People are starting to venture out again. Things are better than you would imagine from the media, but we may not enjoy smooth sailing on placid waters for another year or two. The wind in our sails comes from very low interest rates and lower energy prices. Lower interest rates leave more dollars in our pockets and in businesses, to be spent elsewhere. For example, a
$300,000 mortgage at 5% over 25 years would cost $1,745 per month, but anyone with a variable “prime minus two percent” or line of credit mortgage might be paying $700 less in interest per month. That’s a lot. Buying could become cheaper than renting again, which will support local housing prices and construction. The effect of low interest rates on business is important too. Lower rates mean lower costs and higher profitability, which in leads to stronger employment, capital investment and longevity. Many businesses are in surprisingly good shape. Twice as many publicly traded companies in the U.S. have raised dividends than cut them this year. Lower oil, gasoline and heating prices also cut costs and leave more money for households and businesses to do with as they choose.
Trust Is A Contract When you see the Better Business Bureau Seal, it means that business has agreed to: Tell the Whole Truth
All policies are clear, with no hidden exceptions or fees.
Keep Its Promises
Whether a written contract or a verbal agreement, commitments are kept.
Be Responsive
Resolve any concerns in a timely manner.
Start With Trust
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Various economic indicators are showing improvement. U.S. initial employment claims have started to fall. Long-term interest rates are higher than short-term rates. U.S. LIBOR (a rate at which banks lend to each other) rates have fallen from 3.5% to a more normal ½%, which means financial markets are getting back to normal. U.S. home prices have fallen back to their long-term trend, which means that they don’t have to fall much further, though they still can. Other indicators are showing forward movement, but with sails trimmed. Private sector employment is weak. Building permits issuance is lower, but has not halted. Vernon reports the April year-to-date value of building permits has fallen by about 58% or $56 million, mostly commercial (minus $46 million), but with single-family dwelling permits lower by $15.4 million as well. Regional District permits are down 29% to $19.6 million. On the other hand, the number of dug-up roads suggests infrastructure spending is higher. The economy is not dead, but pining. China deserves a special mention, as they have been a driver of global growth for much of this decade. The fear was that their economy was coupled to U.S. imports, and a slowdown in U.S. consumer spending would cripple China’s growth and hence the world economy. Recent evidence suggests that hasn’t happened. China appears to have “de-coupled” itself from the U.S., with much more of it based
on domestic consumption and infrastructure projects. That is good for the world and especially good for producers of natural resources like Canada. How do things look for this year and next? Tourism should be down this summer, as Americans seem to be cutting spending and staying home. Vineyards are reporting reduced visitor volume this spring. Visitor traffic should rise next winter, as Olympic venues on the coast close down, and winter sports training and events are shifted to places with first class facilities like the Okanagan. U.S. housing construction and the B.C. forestry industry will eventually recover. Right now Americans are forming about 1.2 million households and burning down another 400,000 homes a year. They are building at an annual rate of 460,000, and the inventory of unsold homes is four million, though that number could drop suddenly. The math says it could take two or even three years before lumber consumption and forestry return to normal levels. Full recovery will likely be slower than people and markets are hoping. General Motors must restructure, U.S. and European banks must recapitalize and start lending normally, and U.S. homeowners must sort out their mortgages and reduced home values. American consumers account for about 20% of world consumption, and they have switched from spending more than they earn to
saving about 4% of income. Baby boomers are starting to retire, and will likely start being more careful with their spending. Economic numbers should start to show good growth numbers by the first quarter of 2010, but it may take a few years to get back to 2008 levels. Equity markets could remain stormy. On the one hand, there is still bad economic news to come. On the other hand, some stocks remain significantly undervalued and trillions of dollars remain on the sidelines in cash-like investments. When those dollars move back to equities there could be quite a surge. Gravol may be required. The storm clouds ahead to watch for are sharply higher interest rates or energy costs that would throw the world back into recession. A stronger Loonie would hurt Canadian manufacturing and forestry companies badly. Governments make major policy errors. There may be other sea monsters lurking below as well. For now it looks like sailing through some choppy waters, with a return to smooth sailing visible on the horizon. Dominik Dlouhy P. Eng, MBA, CFA is a Chartered Financial Analyst and planner with Partners in Planning Financial Services Ltd. and The Fraser Financial Group LLP. You can reach Dominik at 545-5258 or dominikd@fraserfinancial.com with questions or comments. Opinions expressed in this article are those of the author and not necessarily those of Partners in Planning or The Fraser Financial Group.
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Business Profile
The magic of the expanding
big,steel box Story By Devon Brooks Photo By Shawn Talbot “As my Dad says, we’re not selling Porsches, we’re selling grocery bags and if people need a grocery bag then they’ll get one,” says Jason Siebenga, half owner of the Okanagan branch of Big Steel Box. Big Steel Box rents or sells new shipping containers, which are used for moving or storage at a specified location or on Big Steel Box’s grounds. He adds, “The reality is people always need to move and store their stuff.” This is all background to Big Steel Box’s announcement that the company now has three locations in Albert, 16 in British Columbian, one in Washington and has recently inaugurated a city-to-city moving
service. Prior to this people rented the containers for use locally unless they bought them outright. Siebenga says his new service is much cheaper than what traditional moving companies charge and that price differential will help drive the company forward in spite of a challenging economy. Siebenga knows about expansion. The company didn’t exist 10 years ago. At that time Jason’s father, Barry Siebenga, was running a landscaping business in Salmon Arm. After talking to other contractors who had to pack, unpack and take their equipment home each day or take a chance it would be stolen at the job site, Siebenga
senior invested in three shipping containers. One he used, the other two he rented out to other contractors at their job sites. Jason says, “It ended up taking over his whole landscaping business.” By 2004 Barry buried his landscaping to work on Big Steel Box full time. Jason says there was another development that helped the company take off. Other companies, most notably Wal-Mart in Kelowna, had been renting out shipping containers for years, but they rented out old, used stock. The dented, scraped and rusting shipping containers of every size and description gave the business a rough and somewhat unsavoury image. Jason says, “What I wanted
to do was market to a higher end user, so our big push was to have new stuff.” In the end the newer, cleaner image paid off so well that Wal-Mart got out of the business locally, turning their clients over to Jason’s company. Big Steel Box opted to get new containers of a standard size, painted up with their logo and it took off from there. One of the reasons they can underbid traditional moving companies is the very low cost of getting the containers. Technically speaking the containers are not new – they’ve been used once. Manufactured in China, the containers pay their way across the
Pacific Ocean by being filled with Chinese exports for a one way trip to Canada at which point Big Steel Box claims them. Jason opened Big Steel Box’s second location in Kelowna in 2003 with financial backing and assistance from Community Futures. The Siebenga’s initial predictions of growth were wildly under-optimistic. They projected that three years after opening, by 2006, they would probably have 100 rentals going on a regular basis, but they hit that in late 2004. As of 2009, the company has 4,000 units available for rental at all their sites, and last year assisted 3,000 customers to move. The majority of the units are CONTINUED ON PAGE 26
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CONTINUED FROM PAGE 25 standard 20-foot long containers that rent out for $135 per month. Originally they’d decided to target the same kinds of users that had wanted the service in Salmon Arm, namely contractors and construction outfits.
In Kelowna they rapidly discovered that residential users were more important to their business. The residential client needed the containers for moving or storage. Jason says, “There was a real
June 2009
the entire country, Jason confides they really haven’t made any concrete plans beyond the next leg of expansion into Saskatchewan.
appetite for them. There was nothing like it here.” Jason’s other brother, Ryan, opened up an office in Abbotsford to start serving the Lower Mainland. In total there are now four offices in the Lower Mainland, one on Vancouver Island, eight in the interior of B.C., three in Alberta and one in Lynden, Washington, but the expansion is far from finished. While the company’s latest press release says it has plans to expand across
The recession is slowing the company’s growth, but Jason says they always knew that would happen. “We’ve always felt we were building a business in a blessed time and we didn’t think it could go on forever.” Perhaps, but as the recession has come on full force, Big Steel
Box in Kelowna is still showing its optimism. The company has been adding people, five in the past six months; although Jason acknowledges that they have a higher rate of empty, unused containers right now. The new people, says Jason, are necessary because of the company’s need to build, what he calls a “strata of managers and district managers.” The new location-to-location
service, the Albert and proposed Saskatchewan expansions require new hands. It is also a case, he says, of the company getting to a sufficient size that there has to be the skills and expertise to carry the business on if Jason, or anyone else is away. He says, “We built a network without planning it.” Now to keep it going and expansion plans on track Big Steel Box is making sure the doors are open for new opportunities.
For further information, please contact Darlene@signaturenetwork.ca or Chris@signaturenetwork.ca or visit our website at www.signaturenetwork.ca – INTEGRITY IS THE STRENGTH OF OUR MEMBERSHIP –
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