Founding of the family business
My maternal grandfather started a lumber brokerage in Montreal after WW1. He named it after himself: E. M. Ball Limited. Working from a downtown Montreal office he represented saw mills, accumulating orders to fill rail cars, and then coordinating pickup or delivery from a local rail siding. Eastern White Pine was his principal product. Unable to have their own children, he and my grandmother adopted my mother in 1921.
The second generation
In 1940 my father and mother met when my father came to Montreal from Toronto for RCAF training on his way to England. My father was born in 1919 and like so many of his generation had to go to work after elementary school to help support the family. The Air Force was an opportunity for him to advance his career. After 2 ½ years in England he returned and they were married in February 1944 and stationed in Ontario. When he was discharged in January 1945 he joined my grandfather in the lumber business. I was born in February 1945 and they would have 6 daughters after me.
The third generation
My grandfather died in 1951 at 65. The business didn’t change much until the 60’s when my father began to sell packaged table legs which he kept in the corner of his office, and later in our garage at home where I was the warehouse manager and head shipper. The margins were 3 to 4 times those on lumber and the do-it-yourself (DIY) revolution was beginning. Soon he added mouldings and needed to rent the office next door. I studied Forestry at the University of New Brunswick from 1963 to 1967. After working for the CIBC for 15 months I joined the family business in 1969 at a time when opportunities for rapid growth were plentiful, and the business needed good people.
The good years
Within a couple of years I learned the business and was able to run it while my father established distribution in Europe for some U.S. products we distributed in Canada. During the 70’s we expanded our Toronto operations and developed partnerships with distributors in Atlantic and Western Canada, allowing us to offer our suppliers national distribution. Our revenues increased by 10 fold, however our gross margins were declining steadily and we needed increased revenues to cover expenses and maintain profitability. Our primary client base had always been retail stores and as middle men we were vulnerable to technological change and global competition. With the exception of the early 80s these were good years. We had 35 employees, 4,000 inventory items, 1,200 clients, delivery trucks, and salesmen driving station wagons to visit building supply and hardware stores throughout Canada.
Succession
I worked with my father from 1969 until he retired in 1981. We did an estate freeze and I was able to purchase his preferred shares for cash before the business closed at the end of 1993. At one time or another 4 of my six sisters worked in the business. However they eventually left Quebec to marry and have families. My two sons ‘grew up’ in the business and my eldest son helped me to close the business in the 90s after he graduated from the University of Western Ontario.
Power Shift
During the 1980s the power shifted from the manufacturer to the retailer. The manufacturers, who generally preferred to sell through distributors, no longer dictated what the distribution channel would be. The retailers, who preferred to buy directly from the manufacturer, had the buying power and a wider choice of suppliers. This was made possible, in part, by the availability of affordable information technology for inventory control, and increased global trade. See Disintermediation.
Decline
In the late 80s we were forced to close our Toronto branch. Margins were inadequate to pay the rent and wages. However we had another 4 good years in Montreal before succumbing to a similar fate. Having expanded our warehouse and introduced new products from Asia, we were vulnerable to the market turndown in the early 90s. Gross margins had fallen from 35% in the 1970s to 15%. In 1992 we suffered a huge loss and used the bankruptcy laws to make a proposal which was accepted. We paid a dividend but could not survive and closed the business at the end of 1993. See Closing a Business.
Working for someone else
For 6 months I was in charge of business development in the U.S. for a Montreal software manufacturer and distributor. The company acted as the outsourced fulfillment department for software publishers. I traveled extensively in Silicon Valley developing business. However working for someone else was difficult after having ‘been my own boss’ for so long.
Starting over
For 8 months in late 1994 and early 1995 I searched for a business opportunity. I settled on a computer training business and incorporated WorkSmart Computer Training Inc. in May 1995. Later that year I decided to buy a franchise called Productivity Point International. I opened 4 classrooms in the Sun Life Building in Montreal in the fall of 1995. I was the sole owner and manager and invested personal funds. We designed and delivered IT training programs to corporations and individuals. We soon had 15 full time and 15 part time employees and revenues reached 2 million dollars in 1998 and 1999. In late 1996 Michael Milken, through his company Knowledge Universe, purchased the franchisor and several franchisees in the U.S. However this investment did not turn out to be fruitful and he never invested in any Canadian franchises.
Tough times again
Until the year 2000 revenues were strong and we were profitable. However after the year 2000 investments in IT slowed and our revenues declined. We fought aggressively in 2000 and 2001 but were eventually forced to sell to a competitor in Spring 2002.
Managing a business during a leadership transition
In April 2002 I joined the Osborne Group, 75 senior executives across Canada who act as Interim Managers. My first assignment was as Interim President of Graphiques M&H. After the premature death of the Owner/President of this prepress company, the family hired me through the Osborne Group to be Interim President. The key accomplishments were the sale of the company to two key employees, the management of day-to-day operations, preparation of the books for the year end audit, and the hiring and training of a controller. In addition to playing the role of President throughout this period, I assumed the role of mediator and mentor on behalf of the new owners.