Okanagan Business Examienr by NICHE MEDIA

OCTOBER 2010

INSIDE:

Financial literacy needs to start young The old-new-old-butnew-again story of Case Furniture The 10 Commandments of Customer Service

Sidual’S

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COVER

Mix of philosophy, ethics and business It’s not just business. It’s the power of your word, your values, youth, doing the best you can and pulling it all together into a semblance of balance. If there’s one thing Stephane Royer knows it’s about balance. Page 16

inside SIDIT’s Interest - 6

Publisher Craig Brown publisher@businessexaminer.ca associate Publisher Chytra Brown chytra@businessexaminer.ca BUSINESS DEVELOPMENT MANAGER Roy Kunicky roy@prospermediagroup.ca MANAGING Editor Devon Brooks editor@businessexaminer.ca ADVERTISING SALES Sales Representative Murray Hicks Angus Cathro Jesse Kunicky Kathie Nickel Design / Production Corrina Deters production@prospermediagroup.ca

Need money, have a great idea and no capital? Tell it to SIDIT. That’s what they’re for.

Assistant to the publisher Joanne Clarke jclarke@prospermediagroup.ca

10 Commandments of Customer Service - 9

Contributing Photographer Shawn Talbot 1.888.317.1403 shawn@shawntalbot.com www.shawntalbot.com

Thou shalt respect thy customer. Thou shalt listen to thy customer. Thy boss will empower thee to be helpful. Plus a lot more.

Retire Wealthy - 11 Our newest columnist, Greg Kalyniuk, says the best things are the simplest things. So he has time-honoured wisdom to pass on from his Dad on how to retire wealthy. And you have to respect that.

Case is Back - 12 They were there, they went away (but they were never really gone) and now they’re back. Confused? Figure out the comings and goings of Case Furniture’s ongoing evolution.

Subscription Rates 12 issues annually | One year: $27.00 778-755-5727 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. PUBLICATIONS MAIL AGREEMENT NO. 41835528 RETURN UNDELIVERABLE CANADIAN ADDRESSES TO: 105-1979 OLD OKANAGAN HIGHWAY, WESTBANK, BC, CANADA V4T 3A4 Follow us on

Summerland’s rE-creation - 15 The District of Summerland is defined by its beauty, its lifestyle and an increasingly senior population bulge. The town knows it and is setting out to change the future. Lucky that several enterprising business people under 40 are already there to show the way. 4 Okanagan Business Examiner / October 2010

President Craig N. Brown Vice President C. Derriksan FOLLOW Noll US ON Grand Chief WFN, U.B.C.I.C.

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inside

Contributors

SIDIT

peace hills Trust

Shelley Gilmore

Liberty Foods

Greg Kalyniuk

Case Furniture

Influential Leadership Survey

Summerland’s rE-creation

Cover story on Sidual

Summerland Projects on the Go 17 The Suburban Princess

Dominik Dlouhy

Zela Wela Kids

Women’s Enterprise Centre

Robert Smithson

Movers & Shakers

Calendar

The Editor’s Take

Robert Smithson

Shelley Gilmore

Smithson is well known for his regular articles on all aspects of labour law and how it affects business. This month his contribution highlights just how difficult it can be for companies that try to impose restrictions on what former employees can or cannot do after they leave an employer. His advice? “Less is more.” Robert Smithson is a lawyer at the Kelowna law firm, Pushor Mitchell.

Shelley Gilmore is a Certified Human Resource Professional with more than a dozen years of experience in a variety of business sectors including wine, health care, non-profits. She has acted as a consultant to many companies and even individuals on how to further their position. This time out she makes the point that there is a direct link between customer service and employee satisfaction. In talking about ‘Taking Zeros to Heroes’ the conversation might be about failing employees, but it is also about failing management.

Okanagan Business Examiner / October 2010 5

Fighting our local Innovation Gap By Devon Brooks

The Conference Board of Canada reported earlier this year that once again, Canada got failing grades for its achievements in innovation. Overall we came in at 14 out of 17 in innovation, generating an overall grade of ‘D’ as measured in 12 different indicators. It is not that we aren’t coming up with any new ideas though: our highest grade among those dozen indicators was a ‘B’ for scientific articles. Our gap lies between the ideas generated and taking them to market. Even outside of the hi-tech science end there is simply less chance that any entrepreneur in Canada will successfully take an idea to market or onto the international stage than in most of our economic peers.

Photo of Luby Pow by Devon Brooks

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Back in 2004 the Okanagan Partnership was created to build on the idea that innovation comes from “clusters” of businesses that, through a gathering of related support industries and experts, help to grow the industry and each other, even if they are competitors. This idea of clusters is part of the essential node of like-thinking people who are credited for creating the Silicon Valley cluster in California and other areas of research and innovation.

Penticton: Karen Chamberlain 250-493-2566 ext 214 Kelowna: Dave Scott 250-868-2132 ext 227 Vernon: Larry Hogan 250-545-2215 ext 249

One of the factors limiting our ability to develop and take ideas to market is the ability to finance them.

Visit www.ourokanagan.ca Connecting our Valley | Creating Opportunity

CEO Luby Pow, who came from what she calls the conventional banking sector, describes one

This is where the Southern Interior Development Initiative Trust (SIDIT) comes into play. It’s mandate is to support “economic development initiatives that will demonstrate long term measurable economic benefits with the Southern Interior.”

of SIDIT’s purposes this way: “We come into the picture when they finish research and development and are going into commercialization.” Formed in 2006 with a one-time $50 million grant from the government of B.C., SIDIT put together a threeyear plan that began in 2007, but recently released a new plan to take it to 2013. Money will go into the projects that have the most promise, but SIDIT’s board has specified 10 sectors where the bulk of its money will be doled out.That will amount, in total, to $7.5 million per year for projects in one or more sectors among agriculture, economic development, energy, forestry, mining, Olympic opportunities, pine beetle recovery, transportation, small business and tourism. Those sector titles, especially economic development, are so broad that almost anything could, in theory, go into them. Pow says there was a shift from the first three years to the second. “We’ve moved away from trail creation and beautification projects to something that can be proven to be sustainable.” The organization fills a needed niche for entrepreneurs with ideas that are simply not yet bankable. She explains, “It’s very difficult to get financing on intellectual property-based companies because there is no collateral to secure. They want real assets.” “For conventionals [lending institutions] once a cash flow is established they will lend, but until the cash flow is established they won’t take the risk.” SIDIT is not a copy of Community Futures, the BDC or any other government funded organization supporting entrepreneurs with

loans even though making loans is part of its mandate.Instead it has a specific geographic focus, and it does finance some nonbusiness ventures, including some educational initiatives. It also collaborates with those other lending institutions and others like community foundations, the B.C. Innovation Council, several postsecondary education institutes, Western Diversification, credit unions, some “enterprising” nonprofits, the Okanagan Innovation Fund and conventional banks.

elected politicians. Then there are two regional advisory committees, one for the Okanagan and another for the Columbia-Kootenay.

Another difference, says Pow, is that SIDIT does not have, or want, a lock-hold on its clients. “Many financial institutions won’t share their information for fear of losing the [client] company, but we aren’t proprietary at all.”

Vineyard Networks is another. The company received vital recognition from Network World magazine this year, which named it one of 10 startups to watch, the only Canadian company on the roster.

So if a company does well, and

One of the companies SIDIT has helped is VeriCorder Technology (digital media recording and editing). In SIDIT’s 2010 Annual Report VeriCorder CEO Gary Symons wrote, “SIDIT funding and support has been the single most critical development for us in our transition from a startup company, to a company generating real revenue.”

Pow says the company is already enjoying tremendous success.

“SIDIT funding and support has been the single most

Map courtesy of SIDIT

SIDIT’s geographic mandate covers the southern interior of the province

attached: those that receive these funds must create the companies and the employment within SIDIT’s area of operation. This too feeds into the idea that clusters of innovation must be built if these kinds of enterprise are to grow here. As Pow acknowledges, once SIDIT loans are paid off the businesses are free to move. “We do anticipate that as some of these companies are sold and our

debt is extinguished they could go elsewhere.” It’s just that that isn’t in the plan. After all they can only get the money if, she says, “They have to show they can generate the funds to keep it going without government support.” Hopefully it means they can keep the companies and employment growing here. And help jump Canada’s innovation gap.

critical development for us in our transition from a startup

SMALL BUSINESS WEEK

OCTOBER 17-23, 2010

company, to a company generating real revenue.”

- Gary Symons other lenders want a bigger piece of the action, they are welcome to take the business away. This means that SIDIT will get its capital (with profits) returned sooner, providing the other lender with a new customer. For entrepreneurs this is a positive sign indicating they are less risky and therefore eligible for lesser interest rates. Pow notes, “Interest rates are based on risk and our deals are substantially riskier.” The SIDIT board includes five provincial appointees, all from within the mandated area and eight

“They’re [Vineyard Networks] still very early stage, but to get a $2 million purchase order in your first year is huge.” Others include SST Wireless, the Pryme Group, Delta C Technologies and Golden Timber Frame. Another aspect of SIDIT is to provide funding for established companies to jump to the next tier. Whether it is a new company, or it’s funding to take one to the next level, Pow says, “It is patient capital.”

POWER UP YOUR BUSINESS INVEST. INNOVATE. GROW.

Take part in activities organized in your region! w w w.b dc .c a /s bw | 1 8 8 8 I N FO B D C NATIONAL SPONSORS

The money comes with a few strings Okanagan Business Examiner / October 2010 7

Peace Hills builds trust across Country Peace Hills Trust, owned by the Samson Cree Nation of Alberta, was the first aboriginal wholly owned financial institution in Canada. Founded 30 years ago in Alberta, Peace Hills Trust is established throughout western Canada with branches located in or urban centres, often on reserve land. “We operate like any other bank,” explains Tony Shirt, Assistant Vice President of Corporate Marketing and Business Development. “We are not just a bank for First Nations customers many of our customers are non-First Nations.” “We’ve grown with the success of our customers. As their capacity has grown, we have mirrored that and grown our customer and asset base,” adds Shirt. The company’s head office is in Hobbema, about 100 kilometers south of Edmonton. In the 30 years since the Samson Cree provided the capital to launch the company, it has grown to more than 120 employees, who serve 20,000 customers. In addition to the head office Peace

Photo Shawn Talbot

8 Okanagan Business Examiner / October 2010

Hills has three other locations in Alberta, two in Saskatchewan, one in Manitoba and, in British Columbia, one location in Kelowna. In the beginning days, there was a strong focus on helping to develop First Nations communities. That relationship building has brought a wealth of experience to Peace Hills Trust says Scott Baldwin, Assistant VP of the B.C. Region. “Most of our lenders are quite experienced and quite comfortable in dealing with First Nations lending on and off reserve.” In British Columbia, the branch has done off and on reserve lending for commercial projects including hotels, casinos, and shopping centres. “We did a nice shopping centre in Duncan for the Cowichan band, in partnership with another financial institution,” says Baldwin. Baldwin also says, “We have forged alliances with other financial institutions. We can come into a deal, do our own analysis, and while we may not be the

lead banker, we do take a share of the risk and the profit.” A clear advantage Peace Hill Trust brings to building on reserve and serving First Nations is their expertise in the legislative and cultural challenges faced by each reserve. “While many issues are becoming more standardized there is still a lot of variance and challenges in accessing capital. We are able to meet many of those challenges.” In the past year Peace Hills Trust expanded their capacity to act as a corporate trust for First Nations. With its very conservative lending policies Peace Hills Trust was able to come through the recent recession relatively unscathed. Shirt credits a strong, independent adjudication process with the smooth sailing. “We are interested in the overall growth of the company on a long term basis, and the attributes and foundational policies which create that growth.”

Taking People from Zeros to Heroes Business is competitive, now more than ever. Every business is literally in a fight to not only earn the confidence of the consumer, but to persuade them to spend what money they do have with them. Dedicating attention to the customer service interface components of business ensures longevity and creates the very natural byproduct of a stronger bottom line. If your mission statement was “the Happiest Place on Earth” would your employees know what the expectations would be day-to-day? Would they be able to answer the ‘why are we here’ question? Disneyland and Walt Disney World have chosen this simple and yet highly effective mission statement to set the expectations for both their employees and their customers. It is used to model every corporate practice. According to Tyler Galts, general manager for the award winning Quails Gate Winery in West Kelowna, “As we’ve grown, we’ve needed to get smarter. We had to put a critical eye to our overall front line and we have worked to get better every year, to chip away at it. We measure how we are doing, gathering continuous feedback and constant review.” He adds, “We believe that the employee experience is the customer experience. A positive effect on the bottom line is definitely a byproduct of good customer service, but it starts with solid communication, connecting the employees to the business through its history and its vision.”

training knows how to treat customers is a poor practice. Teaching them the basics, ensuring there is a standard and providing reinforcement at all levels of the organization and linking all these pieces to a common mission is a business’ key to success. We all know our people on the front lines are the face and the voice of the organization yet so many companies set these critical people up for failure, turning them into service zeros instead of heroes. While standing in a grocery store line up (where I collect my most impressive reconnaissance information) I was speaking with a lady ahead of me. We were chatting about customer service as the store was busy, yet they only had two cashiers open and the lineups were quite long. She wondered why healthcare employees don’t have strong customer service skills. She often felt her needing care from her doctor was an imposition on the office staff. After repeated occurrences of this she chose to use a walk in clinic versus her own family doctor. “Showing a customer that you are having a bad day and offering bad service as a result is not an option,” says Katja Oldendorf, manager of Mickey’s Pub in the Ramada Inn in Kelowna. “We have staff meetings to discuss why we’re here, what we’re doing well and where we’re not meeting the goals we have. Regular communication and consistent application at all levels makes the message of service expectations an easy one.”

Customer service, by many accounts, is slipping in Canada even though a recent Gallup survey suggests a happy, engaged customer will spend 46% more than one who is merely satisfied or marginally engaged.

The comment I hear quite often from managers and business owners is that they don’t have time to stop and reflect, let alone develop a strategy on customer service.

When we think of customer service many of us automatically think of retail or restaurant applications. Truth is store front businesses, business to business and professional services, such as legal and accounting and even healthcare, all deserve failing grades across our country when it comes to service.

Consumers are more fickle than ever, hence the age-old adage about ‘make a customer happy and he’s yours for life, but treat him poorly and he’ll tell 10 people who’ll tell 10 people and so on’ holds very true. You cannot afford to have your front line staff make that kind of impression on a customer or patient – it’s your business’ name and image at stake.

All businesses need to look at their vision, their mission and ask, ‘Why are we here?’ Many front line staff or customer interface employees cannot answer that question, yet organizations must supply clarity of purpose to ensure a strong bottom line. Customer service training needs to become a mandated component of every business. Assuming a person with a nursing degree, an accounting designation or other specialized

My reply – you can ill afford not to.

Solutions can be as complex or as simple, as formal or as fun as you want or need them to be. Start with clarity of purpose and train to meet expectations. There are roadmaps available to get you started, but you have to decide to do things differently and commit to a process. Join a quality standards membership, get your team together and brainstorm your solutions, bring in a qualified consultant to help you create

your strategy – just do something! A general manager I had years ago had, prior to that position, worked overseas for a large hotel company. To ensure all hotel employees, from housekeepers to administrative staff and front desk agents, were intimately connected to why they were there –which of course was the customer– he staged an unusual training session. Many patrons arrived at the hotel after hours of travel so they were exhausted, grumpy, dazed due to time zone changes and eager to get settled. To develop a strong sense of empathy with the customer, the general manager took his staff to the airport, where they boarded a plane, got settled in their seats and then sat on the tarmac for six hours. By the end, the employees were frustrated, tired and just wanted off the plane. When the staff returned to their duties at the hotel, customer satisfaction ratings went through the roof. The employees heard the message, understood their mission and both they and the property benefited. Visitors got the word out. This same general manager gave me the following 10 commandments of customer service, which I still use to this day! • Know who is boss – we are in business to service customer needs; • Be a good listener; • Identify and anticipate the customer’s needs; • Make customers feel important and appreciated; • Help customers understand your company and its systems and processes; •Enact the “can do” attitude – use the power of “yes”; • Know how to apologize; • Give more than is expected; • Get regular feedback, and; • Treat employees well – your internal customer will reflect to your external one. Do your part to improve Canada’s rankings in the customer service arena. Take your organization from zeros to heroes; your bottom line will be healthier for it! Shelley Gilmore is a Kelowna-based business consultant. Gilmore HR works with businesses to link the people side of business and the people strategy to the business plan. She can be contacted at 250-864-1153 or view her services online at www. gilmorehr.com. Okanagan Business Examiner / October 2010 9

Rebates enervate Store Makeover

Photos by Larry Doell, Doell Photography

After three years of a considered move to compete with Wal-Mart and create a more energy efficient operation, Liberty Foods in Fruitvale has completed the first part of an ongoing retrofit program. The results, say the owners, have been a bigger bang for the power consumption buck and an increase in customers and sales. Liberty foods has been owned and operated by the Dar family since 1957. Derrick Dar is the current operations manager and admits that being the main store in town for so long only took the company so far once big box competition showed up. “We are very fortunate to have a very loyal customer base, but we had to encourage our customers to come back once Wal-Mart arrived. We had to figure out our point of differentiation.” The store and building had had no visible work done since 1987; it was showing its age. Five years ago, long before he spent a penny, Dar began an in-depth planning process, including consultations with FortisBC. Fortis did a free walk through audit of the store and made a series of energy efficiency recommendations. Lighting was a key area, as were the coolers and freezers. Going through the consultation process paid off 10 Okanagan Business Examiner / October 2010

in more than advice as Liberty Foods was able to access almost $12,000 in rebates from Fortis. Out of necessity the first change Dar made was to the HVAC system and rooftop compressors. It was a choice customers couldn’t see, but Dar says had an impact on reliability. It wasn’t until Liberty replaced the lighting and store coolers that customers started to notice a difference in their direct experience. Liberty also invested in customer service training and a beautification program that included new lighting. The old lighting had been warehouse style lighting – it was expensive to operate and left dim areas in the store. The all new T8 lighting is brighter, less expensive to run, and customers are happier. Says Dar, “Our old lighting didn’t even line up with the aisles properly. The result is quite bright and friendly.” The deli, meat, dairy and produce sections all received new refrigeration units, replacing old style “coffin coolers.” Essentially, every unit around the perimeter of the store was replaced. The sleek new units being the best design available in the industry, that not only look fresh and new, but involve substantial energy savings. The improved energy efficiency allowed

Liberty to install more units for the same energy consumption. There is still work to be done, says Dar. Sliding aluminum covers for the open coolers are next. With a quarter of a million dollars already spent on retro fits and solid results to show for it, he is confident the next steps will pay for themselves. “Without the rebates from FortisBC I might have been more hesitant to get started, but in some cases where we have spent money we have seen an immediate return and we are able to invest that back into the company.” “To gain customer confidence we had to show a willingness to invest on our part. Beyond that we had to step up our customer service game to go with the renovation.” Liberty Foods manager Derrick Dar

Retiring Rich through Real Estate A Simple Plan

My Dad, William, used to say, “Greg, buy land, they aren’t making any more of it.” While that is true, what Dad didn’t tell me was that if a person owned land he could retire rich. The simple plan I will describe in this short article can help everyone achieve real wealth through real estate ownership. I credit this plan to a book called The Automatic Millionaire Home Owner by David Bach, which is still readily available. Mr. Bach’s thesis is very simple: buy and live in your own home, pay down the mortgage as quickly as you can, take equity out of your home through a refinance and buy another home. You then rent out one of the homes and live in the other. Repeat as often as you can until you retire. Once you retire you can live very well off the income from all of those renters paying you every month. You could even sell one of your investment properties if you need extra fun money. The key to this plan is to not sell your properties, but keep them for the long term. During that time other people help you build wealth by paying down your mortgage. You may even be fortunate enough to experience increased property values over time. If this happens you can use the appreciated value of your home to leverage even more money for other purchases. The beauty of this plan is that you are forced into a savings plan by having to pay your mortgage every month. When your mortgage is paid off you can live in a home for just the cost of utilities and a few repairs now and then. If you own and rent out a second home you use other people’s money (OPM) to save for you and increase retirement income. We all have to live somewhere, so why not buy the home you have to live in? With declining home prices in the Okanagan (finally), extremely low mortgage rates, and high inventory levels the time is right for home ownership. It’s true that to buy a home you have to have a steady job and be able to come up with a down

payment. In this economy, that can be a tall order; however, if you and/or your spouse have reasonably good jobs, with a little patience and a regular savings plan, the down payment won’t be too far off. If you can’t scrape up a down payment look into a rent to own program. It will allow you to find a home you like and live in it while you build up a down payment. First time home buyers can even take money for a down payment out of RRSPs to get started. There are potential challenges and risks to this perfect plan that I might as well lay out on the table. What if you don’t want to be a landlord? The simplest solution for that challenge is to hire a reputable rental management company. It will cost you a percentage of your income every month, but you won’t have to worry about landlord duties.

for by the tenant, leaving extra money in your jeans every month. There you have it – a great, simple plan for building real wealth through real estate ownership. If you have equity in your home, leverage it and use other people’s money to make you rich. Greg Kalyniuk is a Vernon REALTOR working for RE/MAX. You can reach him at 250-503-3758 or by e-mail at greg@okhometeam.ca. Views expressed in this article are the opinions of Greg Kalyniuk and do not necessarily reflect the views or positions of RE/MAX Vernon.

Trade-Marks Industrial Designs

Trade Secrets

& Technology Transfer

What if the property value declines rather than appreciates? All real estate markets are cyclical and you could buy in an up-market like 2007. We are in a down market now, but the market will recover eventually as it always has. When the market does recover, the low point of the present cycle will be higher than the previous down cycle low point. Your property will appreciate and likely at a rate that far outstrips inflation, but remember this plan calls for a long term view, not a quick flip. What if the rent doesn’t cover the expenses? A property that doesn’t pay for itself is a poor investment. You can now find properties in the Okanagan that, when rented out at a fair market rate, will meet that criterion. The key to owning any investment property is to have all costs paid

Patents

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Okanagan Business Examiner / October 2010 11

Making the Case for a Change of Name PHOTOS & STORY By Devon Brooks

After more than ten years of selling under the Ashley banner Case Furniture is back Not too long after Marion and Dennis Case opened their first furniture store in Enderby in 1977 they realized the need for accounting help. Shortly after that they brought on Loydeen Hagman, but finding office space required them to pry the door off a closet, stick up a shelf and squeeze a desk and chair in. Times have changed. Case Furniture Gallery today employs 54 people, working 68,000 sq. ft. of home furnishings in three different buildings in Enderby, Vernon and Kelowna. They ran under the Case name until 1997, when they signed on to the Ashley Furniture business model. In 2004 the pair opened their second Ashley store in Kelowna. Ashley is a privately owned firm based in Wisconsin, which started up in 1945. Retailers with Ashley are independently owned and operated, but agree in their license to stock only Ashley products.

the company also added outdoor furniture and appliances to the product mix. In 2009 the Cases decided to expand again. They took over the 18,000 sq. ft. Sandy Furniture store in Vernon. After renovations it was renamed to the Case logo. This time it was not only an expansion in size, but to another generation. The Vernon store is running under the management of Marion and Dennis’ daughter, Jody Swartz along with her husband Brad. This year the family changed the other two stores to the Case banner. Asked about the loss of identity under the Ashley name, Marion shrugs it off. “In Enderby they still referred to us as Case even though we were Ashley for 10 years.” While the Case name in furniture was never established in Kelowna, she believes that a strong track record of customer service will keep customers returning to the store.

Marion says the Ashley product line is a good one, but after working that model for 13 years the Cases felt the restriction on bringing in other lines wasn’t the best option for them or their customers. She says, “We want to be a leader in fashion.”

She lists off several examples of service that make the difference. The customer, she intones, is always right, even to the point where it sometimes hurts them. When a custom-ordered sofa was brought in the customer came to tell them he’d run into financial difficulties and needed his money back.

Along with different manufacturers

He got it, but at Case’ expense.

Marion says, “We’re flexible. In fact, we’re too flexible.” He’d paid for it with a credit card, so they not only had the furniture, but they had to pay the credit card fees. She is certain that this kind of service will bring that fellow back, and likely have him recommend them to others. All parts of the business work under that service model. Delivery people must check in so that the manager and sales person know a customer is happy with what they bought and how it was delivered. Explains Marion, “The better the experience the customer has, the better our performance, and [the customer] might not even know why.” Changes in furniture retailing are about more than the evolution of the Case family business name. Technology and changing tastes have had profound impacts. Marion, who is her company’s IT guru, remembers when they used to track inventory using a system of recipe cards. The first computer they brought in, sometime in the early ‘90s – she can’t remember exactly when – was to help with that task. Unlike many other industries, the computer has not brought a revolution of online buying. Research, yes, but relatively little purchasing. She asks, “There is furniture bought online, but who’s going to buy a sofa they haven’t sat on?” More important changes have come from how they market and, significantly, to whom. The days when someone would buy a sofa to last 20 years or a lifetime are long gone as is the time when the man believed he ruled the household.

This dining room suite shows much more than just a table and chairs - an example of how displays show what a room can look like, rather than just the product being sold

12 Okanagan Business Examiner / October 2010

One of the reasons that furniture changes, aside from changing fashions, is our transience. Canadians move much more frequently than they used to, and new homes usually need different furniture. Statistics Canada has

charted a correlation and says, “On average, homebuyers spent twice as much on furniture in 2002 as homeowners who did not move.” Statistics from 2002 show the average non-moving homeowner spent $1,371 on furniture (not including appliances or electronics) while a mover spent $2,788. Given the large number of people, especially retirees coming to the Okanagan, strong sales in this market. This also ties into who makes the decisions about furniture purchases. Women aged 25 to 54 buy 80% of all furniture, and how they buy is very different from men. Marion explains, “Men will sit on a sofa and like it or not. Women have a relationship with their environment. They’ll relate [furniture] to their room, their living space and family and friends.” It also ties into how Case (and most other furniture stores nowadays) market. It is also reflected in their advertising where, Marion says, “In graphics we like to have lifestyle images.” They used to display furniture as is, in rows in their stores. Then in 1992 she says they paid “a fortune” to bring in a San Francisco designer to look at their Enderby store and give them advice. His suggestion was to arrange the furniture into settings the buyer could relate to, that she or he could see being in their home. That vision shapes how the company arranges displays to this day and it’s reflected in dozens of set ups you see as you wander through the main store. There is another figure from Statistics Canada that reinforces the Case business plan, which is the growing trend for people to buy their furniture and appliances from furniture store specialists. Sales growth from general merchandise stores like department stores are declining in relative importance as are other retail outlets like supermarkets, drug stores and home building centres.

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@businessex Email: editor .5728 Fax: 778.755

Brilliant idea.

Summerland has always attracted enterprising, creative individuals. Farmers, artists, craftsman and inventors have been making their home here since well before the turn of the century. Perhaps it’s the fresh, unspoiled charm of living in a small lakeside town, surrounded by orchards and vineyards that inspires them? They’ve created multiple varieties of fruits and started BC’s ﬁrst estate winery (now there are 27 in the immediate area). Today they’re patenting one-man vertical take-oﬀ and

landing aircraft, perfecting electric car designs and retroﬁtting microphones for rock stars. All in a little paradise called Summerland. This is a unique place - close to the amenities of larger urban centres, but without all the hassles. The perfect environment to grow your business and bring up your family. So make an inspired choice!

250-404-4042 sboswell@summerland.ca

www.summerland.ca

A brilliant choice for business and family.

The rE-creation of Summerland By Devon Brooks

Stephane Royer here combines two of his passions, performing a BMX flatland riding trick with his screening business gear

The title of Summerland’s new economic development plan, Connecting Summerland to the World, couldn’t be more appropriate. The Okanagan may be the best place to live in Canada, possibly the world, because of its setting, climate and rural character, all advantages Summerland has in abundance. Rural means many things to many people, including a slower lifestyle, less crime and a know-your-neighbour lifestyle. Unfortunately it also tends to be something young people escape from and older people desire. Economically speaking youth have less money and older people more, but the other side of the coin is that young people want more, and opportunities are created in the places they gather. Summerland’s population over 65 is almost double that of the provincial average. By 2028 the

population of British Columbia will decline – if no new migrants came here, but in Summerland the population was in decline, based on children being born to existing residents, as long ago as 1986.

Janey Cruise, should be a business retention and expansion (BRE) program.

Those in charge of the ship of state are aware of the lack of youthful faces, hence the release of the new development plan with its recommendations on changing the demographic.

Scott Boswell, Summerland’s economic development officer, acknowledges that in the past the emphasis was on getting people here with insufficient followup. He says, “There is no real support here. Lots of people will leave within the first two years.”

Advantages to Summerland, states the report, include the ability of the older generation to pass on their experience through business mentorships or volunteer positions, its beautiful lifestyle, core agricultural and wine businesses including the Pacific Agri-Food Research Centre, quality of life, housing affordability compared to neighbouring communities, its location, which allows residents to live there but work in other communities and the school district’s fibre optic infrastructure. Working against economic development is the more conservative spending habits of the older generation, less interest in economic development by older constituents, higher business taxes, and aging esthetics in the downtown. Efforts in attracting people to move there has achieved some success. The regional population has grown every census period from 1976 to the most recent, but at a smaller rate than the Okanagan as a whole or the province. Additionally those moving there are likely to be retirees. Even before the new plan Summerland was participating in an effort to attract emigrants from the United Kingdom.

Lisa Jaager and Scott Boswell cooperate closely in trying to build Summerland’s economy

The economic plan, completed with input from 225 Summerland individuals, suggests more needs to be done than getting people here. One priority say authors Jamie Vann Struth and

After emigrants get here, especially business emigrants, their success depends on them adjusting to local conditions.

Lisa Jaager is the manager of Summerland’s Chamber of Commerce. She says people coming from other countries can be blindsided by differences between our commercial culture and laws and their own. “You almost need someone to hold their hands for a year. Some Dutch owners were shocked that everyday employees here don’t have an employee contract.” Rather than creating another civil servant position, she believes that either current business owners or the body of retired expertise living in Summerland could be the link to newcomers. “The Chamber’s role,” says Jaager, “is to provide the networking opportunities.” Boswell and Jaager are quick to point out local successes like the Kettle Valley Railway or the Bottleneck Drive alliance of local wine makers, and the town is a fine dining mecca, but one possibility for youth are e-businesses. Jaager says young entrepreneurs are quick to make use of new services like social networking. Summerland’s Good Omens coffee house allows customers to order food online through Twitter. Since, by definition e-businesses sell products and services anywhere, they can also exist Continued on page 16

Okanagan Business Examiner / October 2010 15

Continued from page 15

anywhere so long as high speed, reliable Internet connections are available. Currently the best connection in town is a fibre optic cable put in by School District 67. Boswell says the town is in discussions to see if they can extend that network to existing businesses and to help attract others. Of course e-business is already here. Fibre optics are really about the retention, and the future expansion of e-business within the community, partly because youth are already wired, literally and metaphorically to changes occurring online. The question is whether Summerland will invest in creating an atmosphere that attracts more people, like the two profiled below, to the town.

Case Study #1 - Sidual Stephane Royer is unknowingly the poster child for what Summerland needs both demographically and economically. At 36 years of age Royer’s first child is only a baby. Royer is a focused, energetic, thoughtful man running two small, but growing companies that he created. One company uses technology to sell apparel (mostly) to youth online and since his contractors are artists scattered across the province and in Washington, he also uses the Internet to bring their work to him where Royer’s company Sidual, creates value-added product in his home studio. His wife, Devyn, is the main reason he lives in Summerland. She wanted a better place to live and raise their kids than the big city. Although Royer built both his businesses up in Vancouver he says, “When you love the lady as much as I do, you just get up and go.” serving the business community for over 65 years

As Jaager, who is a mother of young children herself, points out, “What makes people stay is how much they enjoy being here. They’re looking for balance.” Royer has already known a certain measure of fame. From age 16 to 30 he was renowned for his BMX flatlander riding skills. BMX flatlanding is trick riding on bikes built with extensions coming out of the axles on front and back wheels to stand on.

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www.sdcu.com 16 Okanagan Business Examiner / October 2010

For years this was Royer’s biggest passion. Then he says, “I needed something new.” Royer went from tricks on bicycles to silk screening and clothing design, with the same intensity. “I love to screen, which is why I got into it.” He literally lived in his studio. He admits, “I used to work two days solid and I’d sleep three or four hours, but I was getting close to [burning out].” On the surface, this sounds like the successful businessman of any age – a passionate, driven man so focused on work that all else is forgotten until he succeeds…or burns up. His confidence still shows: “There’s no ‘I can’t do that.’ That’s how you push and learn things.”

Except that is only one part of Royer and he has a business ethic that really deserves the word ethic. He says, “The world doesn’t need more product, it needs a product to help people, especially people in need.” T-shirts can’t feed the world’s poor or prevent global, but they might carry a message, and perhaps prompt people to think a bit about what they are doing. Royer certainly does, but he is not preachy. He is fully aware of how youth shy away from overt, boy scout moralizing. “We have a spiritual message, but we do it in a cool, marketable way. The spiritual stuff is more personal, more humanitarian.” In the photo of a man and woman laying head to head, the woman holding the sparkler is wearing a shirt with a design of dying, crushed flowers. The designer, Travis Collier, says, “The idea of taking something that symbolizes beauty in its simplest form and presenting it as something chaotic and stressful has always fascinated me. There is something ironic about it. Mutilation is not always a negative thing.” Philosophy and poetry? To Royer the medium is why the message works. “Clothing for the fashion conscious, for the visually conscious, but with a message in mind.” It’s also a business, but there too, Royer is determined to make this about much more than earning a dollar. “It’s not about marketing, marketing, marketing. It’s going to be a company without a CEO – it’s going to be a family business and it’s going to stay that way.” Ironically Royer’s website (www.sidual.com) is eye-catching, trendy and beautiful both in its own right and its ability to market. That still fits with Royer’s approach to do everything as well as possible, including putting out a message that is as honest and powerful as he can make it. “People think we’re a lot bigger than we are because we really did a lot of marketing and I spent a lot of money on that.” The point for Royer isn’t to be the best business person, but to have an honest message and approach to business. People respond well to his integrity, which helps his business. The apparel sales are the retail side of the business, but silk screening, the behind-thescenes creation and application of the artwork to the physical reality of T-shirts also captivates Royer. Take another look at the woman with the sparkler in the photo. Most prints have a print centred smack dab in the middle of the T-shirt. Sidual’s prints wrap around the side, sprawl onto the collars or pockets and he is able to design for sweaters, baseball caps or snowboards. When Sidual left Vancouver behind, Royer knew he’d have to recreate the silk screening business here in the Okanagan. When he started in Vancouver, he went door to door with a backpack carrying samples of his work. He built it up by perseverance. Continued on page 18

Summerland Projects on the Go 10918 Rennie St (industrial new) – Industrial Complex Consultant Okanagan Dev. Consultants – 250-494-0747 Project New industrial park – 4.83 acres Stage Proposed – application for exclusion from the Agricultural Land Reserve submitted 4700 97th St (institutional new) – Pesticide Storage Bldg Architect TRB Architecture – 604-682-6881 Project New pesticide storage building for Pacific Agriculture – 420 sm – non combustible steel frame structure Stage On hold – pending federal funding 5815 Hwy 97 (subdivision) – Residential Applicant Jessie Garcha – 250- 492-6479 Project New residential subdivision – 21 SFD lots Stage Construction Start – approx 6 lots ready for building late summer/10 5815 Johnson St (subdivision) – Residential Owner Rep Re/Max Penticton Realty – 250-492-2266 Project New residential subdivision – 21 SFD lots Stage Development Permit Application – approval anticipated fall/10 9511 9521 Wharton St (mixed use dev) – Wharton Square Owner District of Summerland – 250-494-6451 Designer New Future Building Group – 250-372-3572 Project New mixed use development – 7 structures – 6 to 8 storeys – 300 condominiums – 30,000 sf of ground level retail – arts centre – library – museum – 1 seniors building Stage On Hold – pending market conditions Pineo Court (institutional new)- RCMP Detatchment Owner District of Summerland – 250-494-6451 Architect KMBR Architects Planners – 604-732-1828 Project New building to house the RCMP detachment – 1 storey – 9,600 sf Stage Design – detailed design underway

10511 Quinpool Rd (multi family new) – Townhouses Developer Kirvi Construction Development Co – 250809-1361 Project New townhouses – 2 structures – 1 fourplex – 1 triplex – 7 units total – wood frame construction – peaked roofs – hardy board and cultured stone exterior Stage Construction Start – anticipated Nov/10 OBE_HalfPageIsland_Colour:Layout 1

Pierre Dr, Giants Head Mtn to end of Sage Ave (subdivision) – Residential Owner District of Summerland – 250-494-6451 Project New residential subdivision on 3 parcels adjacent to Giants Head Mountain – 7 acres, 8.6 acres, 6.6 acres – 39 SFD lots Stage Rezoning Application 9/15/2010 8:51 AM– submitted Page 1

© 2010 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Quality.

Integrity.

Leadership.

David Adams, Managing Partner for KPMG’s Vernon office, is pleased to announce the appointment of Peter Ranson, CA, to Office Managing Partner of KPMG’s Kelowna office. Peter is a recognized and sought-after professional in the area of taxation and business advising and is one of Canada's leading professionals on Aboriginal taxation. Please join the partners and the rest of the team members in the Okanagan in congratulating Peter on this appointment. KPMG is proud to serve many of the Okanagan’s leading and growing businesses, providing Audit, Tax, and Advisory services for over 80 years. Our professionals recognize the challenges and opportunities facing businesses, organizations, and individuals, locally and regionally, across the country, and around the world. For more information on how KPMG's professionals can help you, contact us at 250-979-7150. www.kpmg.ca

Okanagan Business Examiner / October 2010 17

used to production talk but aren’t used to being included.”

but is the overstock held by major U.S. retailers, usually from the preceding year.

His approach to service is very much like the golden rule. In the end, he believes, “I want them leaving with the same feeling I’d want when I leave.”

The companies sell it for huge discounts, but there is a catch, says Kole. You can’t pick out three pairs of pants in sizes you know will sell; instead you buy a load of certain kinds of clothing. Exactly what she will receive and in what sizes is a mystery.

Case Study #2 The Suburban Princess

Jennifer Kole, in her second storey shop, The Suburban Princess

Continued from page 16

Here Royer decided to experiment with a single billboard in Westbank. He is surprised by the tremendous response. “The billboard that went up in June changed the business.” He believes, “We really stick out here because we’re really polished with our look, but we’re still a core company.” By core he means small, responsive and, just like Royer himself, oddly personal. He doesn’t talk at you, he engages you. One suspects he neither knows, nor wants to know, a different way to interact with people. It’s just the way he does business. He explains, “A lot of customers are

Jennifer Kole took a personal infatuation with clothes, turned it into a successful import/export business then transformed it again into a bricks and mortar shop. It is a store with an e-dge though. Like many businesses the summer flood of tourists take away a huge part of her inventory, but when the winter comes and tourists dry up, her e-business takes up the slack. In the beginning though this wasn’t a business idea. She kept buying clothes she liked online because she found great deals. Eventually she laughs, “It took over my house.” Realizing that there was more candy in the shop than she could consume she started selling some of it back through eBay. As Kole developed the business she found the best way to make money was not to buy one pair of pants and resell it, but to buy loads of clothing at huge discounts. The clothing is brand new,

The beauty of the Internet is that oddball sizes are going to be exactly what someone needs, somewhere especially if you have it at a great price. Says Kole, “I can sell it for 70% off U.S. retail prices.” Once Kole had too much business to run out of her home, she purchased a store in downtown Summerland and started running the business from the second floor, but word of her business got around locally. “At first I only did online sales, but demand to see what I had was so strong I decided to open a shop,” says Kole. Today, “Eighty percent of sales are now through the store.” It’s not just locals either. As we talk two women from Vancouver come in, telling her how much they enjoyed shopping there when they visited last year. So, is Kole now the proverbial kid that owns the candy shop? Ironically, perhaps because she “over ate from the clothing bin”, Kole shakes her head. “I have a rule that I can’t take it home unless it’s been here a month.” If someone doesn’t buy it up online first.

Summerland Building Permits 101 10611 Victoria Rd $396,000 residential new – duplex Contractor: Mark 1 Dev Inc – 250-890-7089 103 10611 Victoria Rd $417,000 residential new – duplex Contractor: Mark 1 Dev Inc – 250-890-7089 11815 Conway Cr $3,000,000 residential new – SFD Contractor: Sierra West Homes & Construction – 250-767-1993

Experience 4 Star, full service accommodation on the shores of Lake Okanagan. Spacious suites feature full kitchens, fireplaces and balconies Enjoy relaxing in our Beyond Wrapture Spa, Outdoor Pool, Hot Tub, Sauna and Exercise Facilities. On site SWR Boat Rentals offers ski boats, wave runners, kayaks, peddle boats and scooters. 13011 Lakeshore Drive South Summerland BC V0H 1Z1 ph 250-494-8180 ext 4027 fx 250-494-8190 www.summerlandresorthotel.com

18 Okanagan Business Examiner / October 2010

1921 Randall St $309,000 residential new – SFD Contractor: Bonaventure Homes – 778-5165762 5310 Beaver St $205,000 residential new – SFD Contractor: Gurdial & Jaswinder Chahal – 250-492-7974

Brilliant potential. Summerland boasts all the natural ingredients you need to grow fresh, strong minds. Blue skies. Bright sunshine. Green vineyards and lush orchards. And of course, beautiful unspoiled Lake Okanagan right at your doorstep. It’s the perfect environment to grow your business and bring up your family. A small town lifestyle very close to big city amenities. This family-oriented town is ﬁlled with entrepreneurs creating a brighter future for their families. They’re doing everything from designing electric cars and personal ﬂying machines to

selling handcrafted jams and preserves. While the 27 estate wineries in the immediate area continue winning international awards. Fresh ideas. Unfettered creativity. Summerland is an amazingly fertile place. So get inspired. Choose a brilliant future for your children and your business!

250-404-4042 sboswell@summerland.ca

www.summerland.ca

A brilliant choice for family and business.

District of Summerland Snapshot Incorporated: 1906 Area: 73.9 sq. km Statistics Population 11,243 (2009) Population growth rate for 2008-2009: 0.9% (B.C. 1.6%) Population aged 65+ in 2006: 25.7% (B.C. 14.6%) Employment & Labour Force - 2006 figures Total labour force: 5,145 people Labour force as % of total population: 47.2% Percent of labour force self-employed: 21.0% (2006) The three biggest employer sectors in 2006: health care & social assistance (11.6%); retail trade (11.0%); manufacturing (9.6%) Income Median household income (2006): $58,888 (BC $65,787) Average income from those filing tax returns (2007): $36,863 (B.C. $40,802) Main source of income for residents in 2007: Employment (52.1%), Pension (21.2%), Investment (12.3%), Self-employed (5.5%), Other not counting self-employed (5.3%), Total income from employment (2007): $182,705,000 Total income for the District of Summerland (2007) $350,937,000 Business Business incorporations: 36 (2009) 69 (2007) Business bankruptcies: no numbers available Total # of firms with no employees: 415 (June 2008) Total # of firms with employees: 424 (June 2008) Chamber of Commerce members: 650 (membership is mandatory) Building Permits New residential units built: 26 (2009) 81 (2007) Typical house value: $423,157 (2009) $225,799 (2005) Typical house taxation: $3,423 (2009); $2,618 (2005) Value of new residential construction: $14.0 million (2009) $25.2 million (2007) Value of other construction: $2.5 million (2009) $12.3 million (2007) most numbers courtesy of BC Stats Community Facts (www.bcstats.gov.bc.ca) 20 Okanagan Business Examiner / October 2010

Mania and Phobia come together with Takeovers Corporate America is profitable with $4 trillion in cash and valuations at the cheap end of their historical range. The time is ripe for merger and acquisition activity, where healthy companies buy up others at bargain prices like the offer by BHP Billiton, the Australia-based mining giant, to buy Potash Corp. of Saskatchewan. Potash Corp is one of the world’s largest fertilizer producers, having 20% of the world’s production capacity. It is used in soybean and corn agriculture in North America. Sales are about 40% in North America and 60% overseas. The stock traded as high as $300 a share in 2007 on expectations that a growing world population that wanted to shift diets to more meat would require a great deal more fertilizer. The stock crashed to about $65 a share in 2008, and was trading in the $100 range before BHP’s offer of $138 a share. Shares spiked to $150 with the expectation the company was worth much more than $138 a share and that higher bids would emerge. That hasn’t happened as of this writing date and prices have started to tail off. It has been quite a wild ride for investors. BHP made this bid because they want to produce potash, and it is much cheaper to buy Potash Corp and its existing assets than develop the “greenfield” properties they hold in Canada. The timing is good, as credit markets and BHP have recovered enough from the crash to finance the deal, and the expected agricultural boom and higher Potash Corp. share prices have not yet happened. I should note the majority of takeovers destroy shareholder value as acquirers tend to pay too much at the top of the market, lose focus on their existing businesses and don’t realize the hoped for efficiency or productivity gains. This deal is different, as the plan is to buy a good asset cheap. There is a great deal of apprehension, as change is hard and could be detrimental. There have been calls for the governments of Canada and Saskatchewan to block the deal. Should we be banning foreign takeovers of Canadian assets, like this one, and purchases of Alcan, Inco and Falconbridge? It turns out that would be hypocritical. According to the CIA Factbook, Canadians own $81 billion more of foreign assets than foreigners own of Canadian assets, though the case could be made that Canadian companies and assets should not be sold to companies in countries that do not allow Canadian companies

to buy theirs, Brazil’s Vale being a recent example. (Vale was allowed to buy Inco, but a Canadian fertilizer producer was not allowed to buy Brazilian fertilizer assets because they were deemed to be of strategic importance.) How BHP will pay for $39 billion worth of shares starts with Potash Corp’s cashflow from operations, which in 2008, a notably good year, was about $4 billion. BHP’s cashflow for the 12 months ending June 30 was about $18 billion. That makes for a good start. Financing with debt also works well as generational low interest rates are made even lower as they are tax deductible. That’s good for BHP, but not Saskatchewan. The Conference Board estimates the province would lose $2 billion over ten years, and federal finances would suffer too. Many companies taken over by either larger or foreign companies can suffer from “branch plant syndrome.” When an operation is the company’s only asset, the company has an incentive to keep that asset in perfect working order. When it is one of many similar assets and times get tough, it gets very easy to shut down that asset (like the glass plant in Lavington).

make more by holding on a few more years. It’s difficult to place an objective share price on Potash Corp. The three investment banks they hired to give an opinion were quick to say that $130 was inadequate, but careful not to say what they thought would be a fair share price. Investors have until October 19 to decide, and must be wondering whether the grass is truly greener on the other side. 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 any questions, comments or issues you would like to see covered in this column. The opinions expressed in this article are those of the author and not necessarily those of Partners in Planning or The Fraser Financial Group.

A prolonged strike can also help the company, but hurt workers, like the one at Vale’s Inco operations in Ontario and Newfoundland. Vale had no incentive to settle during the Great Recession. That scenario is unlikely for Potash Corp as BHP has no significant fertilizer assets, and they would have a keen interest in keeping it working. Minority shareholders might not fare as well. If the takeover is partially successful, BHP could acquire more than 50% of Potash Corp. but not all of it. That would give them control of the company, and the ability to make decisions, like loading it with debt, that benefit BHP, but aren’t in the remaining minority shareholders’ best interests. There could be some entertaining legal maneuvers if the takeover offer mostly succeeds. Potash can implement a “poison pill” that works for the benefit of minority shareholders by diluting BHP’s position, but it would certainly be challenged in court. Another bidder could emerge, or the bid could fail if too few shareholders tender their shares. Shareholders who bought Potash shares below $100 would be clear winners over the short term, thought it is uncertain whether they could Okanagan Business Examiner / October 2010 21

A Zela Wela World for Kids and Money By Bobbi-Sue Menard

Author Nancy Phillips wrote books on financial literacy for children when she couldn’t find any to help her own kids

When it comes to children and money management North American culture is oddly bereft of any standard, or rational way forward on the subject. Schools barely acknowledge the concept of personal finances until the older grades and then spend a semester teaching teens how to write a check. Parents are often wrapped up in the heavily charged emotional approach they learned from their own parents. Often enough adults in the situation have a precarious grasp of personal financial management themselves. Those rare families able to discuss financial planning and health with their children are limited to books aimed at adults, not children. Kelowna based Nancy Phillips, author of the Zela Wela Kids book series on financial literacy, is working to correct that problem. “A lot of people would rather do anything than talk about money,” says Phillips, “but the best literature shows that children ‘blueprint’ their ideas about money by age 13. You need to start young with teaching your children about money and how to handle it.” Phillips, who has an MBA, comes from a background in kinesiology and worked with global medical research companies in their marketing and development departments. When 22 Okanagan Business Examiner / October 2010

it came time to teach her own children about building wealth and having healthy and realistic attitudes about money, Phillips couldn’t find tools that would help her children learn. Phillips used her science background to start researching the best literature available about children and money. “There are fundamental things you need to ensure your child can do, but the problem is children are not getting that education,” says Phillips. “This series is about giving parents the tools they need to help children reach their potential rather than be held back by money.” Phillips chose to start with books geared to four and five year olds, full of beautiful hand drawn and painted pictures. In the story, the Jack and Emma are taught the importance of allocating their money for specific purposes, and create a special bank to divide their money for giving, saving, investing and spending. “I wanted to create something enjoyable and objective,” says Phillips. “Children can build their own bank and it gives parents a way to talk to their children. The lesson learned in the book is extremely valuable.” The books are creative and positive in tone says Phillips. She hopes parents will be able to

use positive language about money with their children and take anxiety and heavy emotion out of the discussion. One example Phillips suggests parents use occurs when children don’t have enough money to make a large purchase. Rather than dwell on not having enough money, talk about creative ways to save for the purchase and carefully consider the value of the purchase. It can be tough for a parent to separate out lifelong attitudes about personal finances. Phillips is often approached by grandparents who are blunt in stating, “We messed up our own children, and we are buying this book for our grandkids so that doesn’t happen again.” The next six books in the series are written and Phillips will be launching three books in the spring of 2011, and three books in the fall. The future books are written with older age groups in mind: five to nine year olds and nine to 12 year olds. “Having a high net worth as an adult happens when you make your personal finances a priority, when you can plan your spending strategy,” says Phillips. “You can help your children learn to create wealth, their careers and the skills they need.”

Building Employee Morale on a Shoestring Budget Creating good morale at work starts from the moment your new employee walks through your doors. How they are greeted, treated and where they are seated, all play a part in how long you will keep them.

imagination and most importantly, ask your people what they want. If you don’t ask, you may be missing a great opportunity to reward someone in a way that is meaningful to them personally.

The first few days of a new job are always the most confusing, no matter what position you are in. Training, learning and meeting new people will cause a new employee’s head to spin with information overload. Becoming their employer of choice can be relatively easy if you get to know your employees’ individual motivators and can custom tailor rewards are suitable to them.

There is one key reason to put a personal touch on how you treat, reward and acknowledge your employees, and that is retention. Not only are exceptional employees hard to find, but they are very hard to keep as well. Good employees are the lifeblood of any successful organization.

By showing your employees that you care and are interested in their lives, desires and aspirations, you will succeed in creating an environment of trust, respect and loyalty. Watch your employee morale soar and become an employer of choice in your industry. Women’s Enterprise Centre is the go-to place for B.C. women business owners for business loans, skills training, business advisory services, resources, publications and referrals. Call us at 1-800-643-7014 or e-mail inquiry@ womensenterprise.ca from anywhere in B.C.

Cassandra Tompkins, owner of The Woman’s Place Fitness Group in Kelowna, works to help her employees reach their goals; as a result she has retained the same staff for over four years, since opening the business. “Every year I hold performance reviews that include goal setting. If an employee wants to become a certified personal trainer or improve their administration skills I will help them with the costs in meeting those goals. Even if an employee wants to take a certain fitness class during work hours, I’ll cover for her while she tries it out,” says Tompkins. Hosting group social functions, such as lunches out and birthday celebrations also help create cohesive work environment. Creating a “fun survey” and having an employee fill it out when they first arrive gives you great insight into what their likes and dislikes are, how best they like to be recognized for a job well done and what their goals and dreams are. Your Employee Fun Survey can include such questions as: • favourite treat or dessert • do they have a pet and/or children • what are some of their hobbies outside of work • do they prefer a quiet “thank you” or a public show of recognition in front of their peers| • where do they see themselves in the next two to five years • what do they consider work/life balance to be • what reward under $25 would motivate them - gift certificates - movie certificates - restaurant certificates - babysitting or cleaning services • would they be interested in a paid half day or full day off to volunteer for their favourite charity There are many ways to motivate employees without spending a ton of money. You could have a “Be a Manager for a Day” reward or prime parking spot for the month. Use your Okanagan Business Examiner / October 2010 23

Covenant for Less, Get More I’ve written many times on the topic of the unpredictable impact of covenants restricting employees’ post-employment activities. What is certain about such covenants is the value of adhering to the “less is more” rule. Generally speaking, in the employment context, post-employment restrictions on an individual’s conduct are presumed to be unenforceable. That is the result of the fact that free labour mobility is a matter of public policy. In practice, that means that (with some limitations) individuals can move on to ply their trade wherever, and with whomever, they choose. That includes doing so with a competitor of the former employer. Businesses, on the other hand, have a private interest in limiting competition and some seek to bind their employees by way of various restrictive covenants. This interest in eliminating competition can drive employers to impose covenants that are unreasonable in the circumstances.

The enforceability of those covenants is frequently debated before Canadian courts. Almost universally, the less restrictive a covenant is on the employee’s post-employment activities, the more receptive the courts will be to its enforcement. A recent decision from Ontario’s Superior Court of Justice provides an example of an employer who successfully applied the “less is more” rule. Tom Mason was a technical sales representative who had been employed by Chem-Trend Limited Partnership for 17 years. Mason’s sales territory was all of Canada and certain parts of the United States. Chem-Trend is a company with worldwide operations and customers. Mason was required to be familiar with Chem-Trend’s products and their customers’ businesses and operations and product needs. At the time of hiring, Mason had signed a restrictive covenant in which he agreed, for a

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Mason’s employment was terminated and he sued for damages for wrongful dismissal. Chem-Trend counterclaimed against Mason for breaching the restrictive covenant by “using his knowledge and experience at Chem-Trend to gain business opportunities for himself.” Mason’s view was that the restrictive covenant was unreasonable and far too broad to be enforceable. The Court considered the covenant’s geographic scope, the range of restricted activities, and the duration of the restrictions. After finding the geographic scope and range of restricted activities to be reasonable (though “more onerous than the norm”), the Court turned its attention to the duration. The Court stated “[T]he covenant is only in effect for one year, which is considerably shorter than periods found in other restrictive covenants that the Courts have considered and upheld.” Citing a leading case in which a five year covenant was upheld, the Court concluded, “[t]he restrictive covenant being in place for one year after Mr. Mason’s termination is a relatively short period of time.” Notably, the Court mentioned that the short duration of the covenant balanced the fact that the geographic scope and range of restricted activities were relatively onerous. As a result, the Court found the restrictive covenant (as a whole) to be reasonable and enforceable against Mason’s post-employment activities. Had Chem-Trend succumbed to the temptation to impose the restrictive covenant for a longer duration, it seems likely the Court would have found it to be unenforceable. As it was, ChemTrend’s shrewd application of the “less is more” rule was its saving grace.

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period of one year following termination, not to engage in competitive business activities or to solicit business from any of Chem-Trend’s customers or to cause a disruption of any of Chem-Trend’s customer relationships.

Pamela Nelson Business Advisor Kelowna

Robert Smithson is a labour and employment lawyer. For more information about his practice, or to view past “Legal Ease” articles, go to www. pushormitchell.com. This subject matter is provided for general informational purposes only and is not intended to be relied upon as legal advice.

E N V I R O N M E N TA L LY F R I E N D LY O F F I C E F U R N I T U R E

B U S I N E S S

F U R N I S H I N G S

Agents of Change Environmental Mandate

“Furniture is very important from an indoor air quality standpoint because furniture has the greatest surface area.” -Dr. Marilyn Black, Founder, Greengaurd Environmental Institute

Our goal in adopting the Go Green Business Challenge is to enhance our green initiatives by empowering our people to do office design right. We have the resources and the expertise essential in designing and implementing environmentally and user friendly long-term office spaces, with the least amount of impact on our environment. Our Major supplier Teknion Furniture Systems is the first office furniture manufacturer to attain ISO 14001 certification for all of their major facilities. ISO 14001 is a preventive management tool. (1) By requiring management commitment to compliance with applicable legislation and regulations and to continuous improvement, it forms the basis for a systematic approach to the prevention of pollution. (2) What makes it significantly different from other approaches is this: ISO 14001 is not a set of regulations or laws that require strict compliance. Rather, it is an internationally recognized standard that defines the criteria for a management system for developing and controlling those aspects of a firm's operations that can have an effect on the environment. Teknion has an unparalleled environmental sustainability mandate. All product lines are Green Guard certified for indoor air quality. Integration is clearly evident in how we apply our extensive portfolio of products. It saves time, money and the environment by adapting to the constant change in the workplace. Footnote: (1) www.qualitysystems2008.com. “Does Your Business Care About The Environment?” (2) www.qualitysystems2008.com. “Does Your Business Care About The Environment?”

At Total Office, we care about the world we live in, and understand the effects the products we sell have on the environment. Our own environmental mandate is to promote Canadian manufactured products that are minimally packaged and produced to environmental standards by workers being paid a fair wage. Products that are made to stand the test of time and last. Total Office is one of the first companies to adopt the Kelowna Chamber of Commerce Go Green Business Challenge Workplace Strategy. Internally we recycle used furniture in our Pre-Owned Furniture Division, separate and recycle all packaging and reuse as many of the products we can.

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#VTJOFTT 0XOFST 4UBGG Pentictonâ&#x20AC;&#x2122;s Cannery Brewing took home a gold and #FOFÂžU 1MBOT *OTVSBODF 4FSWJDFT silver award at the 8th Annual Canadian Brewing Awards in Toronto, which was timed to coincide with â&#x20AC;&#x2DC;Beer Weekâ&#x20AC;&#x2122; there. Patt Dyck, co-owner of Cannery Brewing brought home a gold medal (shaped like a draft tap handle) for the companyâ&#x20AC;&#x2122;s new Squire Scotch Ale and a silver medal for the companyâ&#x20AC;&#x2122;s flagship Naramata Nut Brown Ale. Awards are presented in 31 categories. The competition is open to breweries of all sizes across the country in a blind taste-test by 20 judges. Dyck is thrilled about the recognition, saying, â&#x20AC;&#x153;It is an honour to be recognized alongside other colleagues who are so committed to the brewing of hand-crafted ales and lagers.â&#x20AC;? 1I 5' -BLFTIPSF 3PBE ,FMPXOB #$ Penticton Chamber gets &NBJM ECÂžOBODJBM!TIBXCJ[ DB XXX CDCFOFÂžUQMBOT DPN Accreditation

The Penticton & Wine Country Chamber of Commerce achieved chamber accreditation at the Canadian Chamber of Commerce AGM held in September in Gatineau, Quebec. Accreditation means a chamber must meet tough standards in critical areas of governance, operations, membership programming,

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New business starts increased in July after declining in both May and June of this year, reports Small Business BC, which is funded by the provincial government and Western Economic Diversification. Business starts fell by 176 in the late spring months but jumped up by 344 to a total of 4,728 for the year in July. In 2009, the government says June and July showed much bleaker numbers, with a combined drop of 732 to less than 4,000 starts per month. For the 12 months ending in July 52,599 businesses were created, 2,504 more than in the same 12 month period a year ago.

UBC Alumni in the Okanagan named Dr. Richard Hooper as recipient of the 2010 Community Builder Award for 2010 at the 3rd Annual Okanagan Alumni Endowment Fund Gala at the end of September. Hooper is a medical doctor, the Clinical Program Director for Regional Cardiac Services with Interior Health, a former president of the Kelowna Medical Society and the BC Cardiologistâ&#x20AC;&#x2122;s Association. In addition Hooper and his wife â&#x20AC;&#x153;were instrumental in bringing The Crossing at Keremeos, a multimillion dollar residential care facility for drug-addicted youth, to the Okanagan.â&#x20AC;?

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was suggested by the Enderby & District Chamber of Commerce and passed unanimously by town council. The policy favours design proposals featuring innovative and extensive uses of wood, especially if it is sourced locally. According to Tate Bengston, the Chamberâ&#x20AC;&#x2122;s executive director, the policy â&#x20AC;&#x153;will encourage contractors to develop working knowledge of local opportunities to acquire wood and wood products.â&#x20AC;? Bengston says it is also a nod to the forestry industry, which has been instrumental in the economies of many communities in the region including Enderby.

Funding Contract signed for Destination Osoyoos

Destination Osoyoos (DO) is the tourism agency for Osoyoos and the surrounding region. Last month the Town of Osoyoos, the Regional District OkanaganSimilkameen and the Nkâ&#x20AC;&#x2122;Mip Resort Association signed on the dotted line, providing operational funding for DO for the next three years and agreeing to develop some new marketing initiatives during that period. The agreement provides DO with a budget of $150,000 each year. This money is in addition to the $200,000 raised each year through Osoyoosâ&#x20AC;&#x2122; 2% Additional Hotel Room Tax and funneled through the Tourism Advisory Committee. The Committee has committed to coordinating that money with DOâ&#x20AC;&#x2122;s efforts. Don Brogan is board chair for Destination Osoyoos and says, â&#x20AC;&#x153;In my opinion, it was critical that the previous success and the growing momentum created by the earlier agreements between the Town and Destination Osoyoos be continued.â&#x20AC;?

Celebrating the signing of the new

The City of Enderby has officially endorsed the use of wood as the preferred building material through the introduction of its â&#x20AC;&#x2DC;Wood Firstâ&#x20AC;&#x2122; bylaw. The idea

three-year partnership funding agreement for Destination Osoyoos are, from left, DO Board Members Rob Rausch and Paul Scanlon, DO SecretaryTreasurer Peter Bueschkens, DO

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February 2010 Okanagan Business Examiner

Community Development Manager Jim

PMG awarded Westside Visitor Guide Contract

The Westside Visitor Guide Contract for the 2011 Visitorâ&#x20AC;&#x2122;s Guide has gone to Prosper Media Group, publishers of the Okanagan Business Examiner.

&Shakers Along with the usual tourism materials the new guide will also feature a section on economic development. Broc Braconnier, chair of the Tourism Westside Committee, “Our plan included destination marketing, but it also focused on infrastructure and supporting economic development for the area. We see this guide as a tool that can support both of those goals.”

Forensic Psychology

Centre opens at UBCO

but now starts a three year term as the official dean while Mary Courtney was appointed to be dean of the Faculty of Health and Social Development for five years.

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New Book demolishes

sweet Taste

In other UBCO news the Okanagan campus welcomed three deans to their new posts. Dr. Lynn Bosetti is the new dean of the Faculty of Education. Bosetti is coming to UBCO from the University of Calgary where she was the professor in Educational Policy and Leadership Studies and served at one time as the vice dean for the Faculty of Education.

Organic Myths

Vernon’s Salt Team RE/MAX held their annual Pumpkin-Fest charity fund raiser at the Pumpkin Patch on St. Annes Road in Vernon. Kids get hot chocolate, hot dogs

Deans Mary Courtney, Lynn Bosetti and Cynthia Mathieson

Cynthia Mathieson was already the acting dean at the Irving K. Barber School of Arts and Sciences at UBCO,

Author Mischa Popoff, contributor to the Okanagan Business Examiner, has released his new book, Is it Organic? Popoff, along with being a writer is also certified as an International Organic Inspectors Association inspector. Popoff says the original intention of farmers to produce and deliver naturally grown, healthy foods to market has been subverted by big business and bureaucracy. He writes, “What you think about organic food is mostly wrong. The global organic industrial-complex promises everything and delivers nothing. But don’t blame organic farmers! They’re victims, along with millions of consumers. Being organic is no longer about farming fields. It’s about filling forms. Your taxes underwrite this marketing subterfuge and help drive a stake into the heart of the most efficient food system ever known.” For more information on the

Salted Pumpkins have

and free pumpkins, but the event raised $500 for the Children’s Miracle Network. The food is prepared and served by Salt’s team of realtors. Gabriel Allaway is a young, but unabashed supporter who boldly claimed, “This is the best pumpkin patch I ever went to.” Allaway was clearly wowed by the team’s skills in preparing both the dogs and chocolate refreshments.

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Investments at UBCO continue as the opening of the new Centre for the Advancement of Psychological Sciences and Law attests to. The new centre will be located in the newly opened Arts and Sciences building (Phase II) at the Kelowna campus. The centre is “designed to emerge as a nationally and internationally renowned centre for forensic psychological research, practice and training.” Four key areas of research will be: personality/ psychopathy and aggression; investigative psychology (deception,

memory); legal decision-making, and; violence interventions and victim services. The $368,000 facility was jointly funded by the province, the Canadian Foundation for Innovation and UBC.

Okanagan Business Examiner / October 2010 27

Ca l e n da r Business After Hours -

Business After Business

Oct. 21 - Coast Wholesale

- Oct. 28 - OSNS Child

Appliances, Kelowna

Development Centre,

The Kelowna Chamber of Commerce monthly networking event from 5 to 7 pm. $10 for members, $15 for non-members. Event is co-hosted with Poppadoms, who will provide a taste of India for the food. Call 250861-3627 for information.

Penticton

The Penticton & Wine Country Chamber of Commerce’ monthly networking event from 5 to 7 pm. Free for members, $20 for nonmembers. More information online at www.penticton.org/chamberevents.aspx. CCSBE 2010 Annual Conference - Oct. 28-30 -

Business After Business Oct. 26 - Royal Cdn. Legion, Armstrong Branch

The Armstrong-Spallumcheen Chamber of Commerce’ annual networking event to kick off its poppy campaign. From 5 to 7 pm. Free. More information by calling 250-546-8155.

$577.50. Register online by going to http://tickets.mtroyal.ca or call 403-440-7770. Interactive Communication Video Training - Nov. 2 - Community Futures, Penticton

A three hour session to help you figure out your communication style and help understand others. To register call 250-493-2566 or e-mail info@cfokanagan.com.

- Nov. 3-5 - Sparkling Hill Resort, Vernon

Speakers from Britain, Washington, Alberta and B.C. will be ‘Reflecting on Excellence’ at the second annual Thompson Okanagan Tourism Summit. There will be workshops, panels and plenary session. Entrance to the resort will be restricted to those who are registered at the summit. $386.40 (incl. HST) until Oct. 1; $442.20 afterward. More information at www.totabc.org/tourismsummit.

FoodSafe Level 1 - Nov. 2 - Penticton Chamber of Commerce

Emerging Companies

All day course taught by Valentine Young. $50 Register by calling Val at 250-490-9300.

Seminar - Nov. 9 - Coast

Mount Royal University, Calgary

VWIB Luncheon - Nov. 3 -

The annual conference of the Canadian Council for Small Business & Entrepreneurship has a theme this year exploring the connection between entrepreneurship and community. Full registration including taxes is

Schubert Centre, Vernon

Okanagan TelephOne COmpany lTD.

2nd Annual TOTA Summit

Vernon Women in Business’ monthly luncheon, networking meeting. From 11:30 am to 1 pm. $14 for members, $20 for nonmembers. Contact information: info@vwib.com.

Capri Hotel, Kelowna

This one day seminar is the second in a series of three (single seminar attendance is permitted) put on BCIC New Ventures and hosted in our region by ORIC-OSTEC. This seminar: ‘Perfecting the Package - Communicating the essential merits of a new venture’ is about helping the entrepreneur to get off the ground. It runs from 2 to 6 pm. $20 Register by e-mail at events@

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ostec.ca or call Chantelle Kshyk at 250-712-3340. Changes in the Workplace Webinar - Nov. 9 - Your home or office computer

A panel discussion of workforce values, technology integration and globalization. Part of the BCIT Corporate Training webinars. Begins at 8:30 am. Register by calling Simonetta Mezzomo at 604-412-7651. Registration limited to 100 people.

register for the full three days for $299 to $699, or for one day or individual sessions for less. More information, the full schedule and registration is available online at www.regonline.ca/bsc2010. Business After 5 - Nov. 16 City Furniture, Vernon

The Greater Vernon Chamber of Commerce’ monthly networking event from 5 to 7 pm. $5 for members, $15 for non-members. Call 250-545-0771 for information.

Building Sustainable

Business After Hours - Nov.

Communities - Nov. 15-

18 - BC Wine Museum & VQA

18 - Delta Grand Resort,

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Kelowna

This three-day conference features more than 100 speakers from the public, private, academic and non-profit sectors. The first day theme is ‘Championing Change: A Sustainability Planning Forum’, the second day is ‘Pollution Prevention & Mitigation’ and ‘Green Economic Development’ while the third day is about ‘Community Sustainability’. Those wishing to attend can

The Kelowna Chamber of Commerce’ monthly networking event from 5 to 7 pm. $10 for members, $15 for non-members. Call 250-861-3627 for information. Selling Goods Seminars Dec. 9 - Penticton Chamber of Commerce

This all day session consists of two separate seminars. The morning

seminar, from 10:30 am to noon is on how to ‘Sell your Goods & Services to the Government of Canada’, while the afternoon from 1 to 3 pm is on how to ‘Import & Export your Goods’. Both seminars are free but you must pre-register. For more information contact Leanne Kruger at 250-493-3323 or by e-mail: lkruger@penticton.org. Business After 5 - Dec. 14 -

international competitiveness or bring in new strategies to increases company productivity or competitiveness. Employers must have fewer than 50 employes, have been in business for at least one year and be in good standing with the BC Corporate Registry. More information and applications are available online at www.aved. gov.bc.ca/workplace_training_ program/welcome.htm.

Vernon Public Art Gallery

The Greater Vernon Chamber of Commerce’ monthly networking event from 5 to 7 pm. $5 for members, $15 for non-members. Call 250-545-0771 for information. Workplace Training for Innovation - until Jan. 2011 - All locations

B.C.’s Ministry of Advanced Education and Labour Market Development has created the new Workplace Training for Innovation Program. Eligible employers can apply for funding to improve productivity, introduce new technology or equipment, improve

Emerging Companies Seminar - Jan 13 - Coast Capri Hotel, Kelowna

This one day seminar is the third in a series of three (single seminar attendance is permitted) put on BCIC New Ventures and hosted in our region by ORIC-OSTEC. This seminar: ‘Building the Beast - Creating a sales & marketing function for new ventures’ is about helping the entrepreneur to get off the ground. It runs from 2 to 5 pm. $20 Register by e-mail at events@ ostec.ca or call Chantelle Kshyk at 250-712-3340.

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ST KOOTENAY CUSTOMERS FOR OVER 24 YEARS. Okanagan Business Examiner 10-09-07 / October3:28 2010PM 29

Fair share taxes: only in the eye of the beholder What to make of the report last month that stolen Switzerland banking records, now in the hands of French investigators, show 1,800 Canadians as having Swiss bank accounts worth a minimum of $500,000? Switzerland’s secretive banking officials are predictably miffed and Canadians seem split on whether it is justice that some of the rich avoided the taxes or justice that they have been ratted out. The French were the first to receive the list to track down tax evaders, but noted that 1,800 Canadians is a conspicuously large number for our population. Americans deposit holders on the list were said to number only 1,600. Consider that in 2006/2007 there were only 751 official offences prosecuted under Canada’s Income Tax Act, 80% of which, by the way, ended with a guilty verdict.

are the calls about what this means. Canadian taxes are too high, highlighted by the fact that fewer Americans are on the list, but that’s a red herring. Throw out the American comparison because these records are from one bank only, which might mean nothing more than that the HSBC did a better job landing Canadian customers than it did in getting American ones. It was only last year that the U.S. forced Swiss bank UBS to give over records of 4,450 American clients who had accounts with that company to avoid taxes. It is also likely that the record thief, Hervé Falciani, was not able to gather all the records of account holders on his way out of the country so he might have taken the Canadian section and not the American ones. We don’t know.

Having a Swiss bank account is not a crime in Canada, but not reporting the income from such accounts or sneaking it over there without declaring it, is.

Then there are those clamoring that these people are tax evaders who should be paying their fair share. Fair share is like beauty; pretty much it’s in the eye of the beholder.

Just as predictable as Swiss ire

Aside from the fact that none of

us really want to pay any taxes it is really tough to compare tax rates. Canadian taxes, especially B.C. taxes have come down substantially in the past 10 years, but yesterday’s tax cuts quickly become old news.

on how much we pay, far, far too much. The Fraser Institute insists a real measurement of all taxes mean most Canadians (it varies slightly by province) pay almost half their income to one kind of tax or another.

One measure of taxes are total tax receipts as a percentage of GDP. The United States comes out way ahead on that measure: 25.5% versus Canada’s 33.5%, but that was using 2004 figures. Since then many tax reductions have come into play in Canada with more scheduled into the future. Even if you discount tax cuts since then some people claim the U.S. figure is artificially low, by about 6%, because the United States doesn’t include health care costs, a huge factor in Canada’s tax burden.

All that aside a 2010 OECD study shows, that by corporate tax measurements the U.S. is the second worst in the world at 39.21%, only slightly behind Japan’s 39.54%. In that measurement Canada was way ahead at 29.52%, but it is expected to get a bigger jump on the U.S. as corporate tax rates here are scheduled to decline another 4% by 2012 while America is staying the course. In June this year the online publication The Daily Caller reported Japan would lower corporate rates putting the U.S. into the corporate tax lead.

Similarly there are other fees and government costs that don’t show up as taxes per se. Factor these into the standings and it’s not going to show up to our advantage in any U.S. - Canada comparison. Certainly you’ll hear a lot from the Canadian Taxpayers Federation

On personal tax rates we don’t fare as well; although our personal income tax rates have come down, we are still approximately 7 or 8% higher than the U.S. average. What’s fair and what’s competitive depends on whether you’re rich or poor, educated or not, running a company or employed on the government payroll, but mostly it will depend on who you compare yourself to. I’ll wager the Canadian holders of those Swiss bank accounts aren’t interested in the average Canadian’s tax experiences – instead they compare themselves with wealthy peers. Similarly most Canadians don’t care whether the elite in the U.S. or Switzerland or Singapore can get away with paying little or no taxes, they know the tax bite in their pockets and are bitter when they feel Canada’s extreme wealthy get away with less. Fair income taxes have little to do with facts, it’s about how you feel. Devon Brooks is the managing editor of the Okanagan Business Examiner. Any comments or ideas you wish to share on this, or any other content in the Business Examiner, should be sent to editor@businessexaminer.ca.

30 Okanagan Business Examiner / October 2010

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