BCBusiness

bcbusiness.ca June 2015 BCBusiness 31 Happily, Royal Bank stepped up with a new $300,000 line of credit. "They saw something in us," Henderson says, "and kudos to them." Reed's wife, Karen, cleaned the kitchen as there was no money for janitorial sta. Henderson and Pettigrew ("The best salesman I've ever known," Henderson says) ‡ew down to the headquarters of Hughes-Avicom in Los Angeles and came away with a million-dollar electronic manufacturing contract. Sta buy-in was key to the turnaround—•rst in terms of the extra hours of work required, and then literally as Cre- ation launched an employee share purchase plan. "When you have engaged people thinking like owners, you get two things," Reed says. "Every- one gets to share in the excitement when you suc- ceed, and everyone sees the •nancial bene•t." Within about a year, wages were restored; within •ve, staˆng was roughly back to previous levels. But the crisis had temporarily sidelined the company's music equipment business. "We didn't have the time or money for R&D, so at •rst we had to focus on the exist- ing CEM (contract electronics manufacturing) side," Hen- derson says. With Creation back on its feet, Henderson received a BC Science Council grant of $137,000 and in 1992 unveiled RADAR, a digital studio recording system. Creation partnered with Japanese company Otari to dis- tribute RADAR, which was soon being used by the likes of Stevie Wonder. When Otari ran into serious diˆculty in 1999, Henderson wanted Creation to take back RADAR. But by that time Creation's circuit board business was pulling in, by Henderson's rough estimation, "about a million per month." It was mutually decided that Hen- derson would buy the music division and go his own way. Now called Iz Technolo y Corporation, it recently launched a cutting-edge studio-in-a-box product being used by Neil Young, U2, Disney Cruise Lines and IMAX, among others. As for Creation, the company long ago outgrew its North Vancouver facility, moving to an expanded Burn- aby location; it also has manufacturing operations in San Jose, Dallas, Milwaukee, Minnesota, Chicago, Missis- sauga, Mexicali and Changzhou. Projected revenues for 2014 were $500 million. And there will be no more days like March 19, 1991: today no single client represents more than •ve percent of the company's business. Army & Navy LAST BRAND STANDING A rmy & Navy may not be a general store, but in 1998 it needed a new plan of attack. That's when the new commander-in-chief took over. And Jacqui Cohen was ready to map out a strate y. "I was so ready for it," Cohen says now. "It was in my blood." The Army & Navy chain was launched in Vancouver by Sam Cohen in 1919. Over the decades it expanded to Edmonton, Moose Jaw, Saskatoon and Regina (which became the new headquarters), with sales topping $100 million by the late 1970s. But by the time Cohen's grand- daughter assumed command two decades later, revenues had dropped by approximately half. Its ‡agship store was still located in Vancouver's Downtown Eastside, hardly the desirable locale it had been in 1919. But Cohen did not turn her guns in that direction. She closed all three Saskatchewan stores and shifted the company headquarters from Regina back to Van- couver. She also sold the Edmonton property. "At the time the [Edmonton] downtown core was dying, although they are revitalizing it now," Cohen recalls. Cohen did not abandon the Edmonton market though—she opened a new Army & Navy in Londonderry Mall. "More family-friendly," Cohen says. She also opened a new store in Langley. Cohen streamlined the buying process. Whereas the chain had once employed separate buyers for each store, Cohen centralized the operation while at the same time specializing. "There are now six dierent buyers—one for each department," she says. "They understand the needs of their particular department in each store." Army & Navy stock varies from location to location, with groceries more important in the Downtown Eastside, for instance, than they are in Edmonton. "As they say, retail is detail, and it all starts with the buy." Part of the Army & Navy survival story can be linked to marketing eorts that have made the brand relevant again. The annual shoe sale in May, the most successful holdover from the company's past, has become a major media event and this year for the •rst time also happened online. It's a natural evolution for Cohen. "Once we used ‡yers, but 20-year-olds don't really read ‡yers anymore," she says. While consolidation and refocusing have not returned Army & Navy to its nine-•gure 1970s heyday, the decline has been checked. Revenues have remained relatively constant in the $50-million range during Cohen's tenure, even as other department store chains such as Eaton's, Zellers, Kmart and Kresge (to name a few) have disap- peared from the Canadian map. All those tombstones on the retail landscape serve as reminders that the battle never ends. "Can you sit back and collect your rewards?" Cohen asks. "Never." n THE GREAT TURNAROUND Part of the Army & Navy survival story can be linked to marketing e•orts that have made the brand relevant again. The annual shoe sale in May, the most successful holdover from the company's past, has become a major media event

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