With a mission to inform, empower, celebrate and advocate for British Columbia's current and aspiring business leaders, BCBusiness go behind the headlines and bring readers face to face with the key issues and people driving business in B.C.
Issue link: http://digital.canadawide.com/i/950283
SOURCES: B.C. CONSTRUCTION ASSOCIATION, NATIONAL TRADE CONTRACTORS COALITION OF CANADA Chan, director of product commercialization and quality. "To be first with innovation, we need a playground close to home where our teams can observe and respond quickly to evolving results." Dave Lane and Jeremy Guard founded Arc'teryx in 1989. They launched the business with the first laminated climb- ing harness, whose 3D foam made it more comfortable than traditional stitched versions. Arc'teryx designers went on to invent the waterproof zipper. To shave weight, they cut water- proofing tape in half. When they couldn't find a machine to form knee pads, they tinkered their own. The company has also innovated with style, going for a clean, minimalist aesthetic. Dedicated teams in its design department focus on colour and patternmaking. Arc'teryx products are usually the most expensive in their category, but they still sell. "Arc'teryx is not distracted," says Doug Schnitzspahn, the Colorado-based editor of Outdoor Retailer magazine, which covers the adventure sports gear industry. "They survive at a high price point by being disciplined with what they do and with the quality of the products they offer." Now a privately owned subsidiary of Finnish conglomer- ate Amer Sports Corp., which bought it in 2005, Arc'teryx doesn't share financial data. But in 2014 the company told ski pub- lication Powder magazine that it was approaching US$300 million in annual sales. Arc'teryx has since increased its head office and design centre head count by a third, from 325 to 473, and manu- facturing and warehouse staff by even more, from 250 to 480. As the company grew, it expanded from domestic manu- facturing to more than 20 partner factories worldwide, in countries from China and Vietnam to Bangladesh and El Salvador. But Arc'teryx has consistently kept 10 percent of production in the Lower Mainland, mainly safety items such as an avalanche airbag pack and climbing harnesses, new and emerging products, and the Alpha SV jacket. "[A local factory] provides a safe place to experiment," Chan says. "We tend to keep our bigger challenges at Arc'One, where we're better able to moni- tor, guide production and then leverage the experience to our overseas facilities." Domestic manufacturing also lets companies like Arc'teryx remain nimble, says Marcus Ewert-Johns, president and CEO of the BC Alliance for Manufac- turing, an advocacy group. "Chinese factories only want massive orders," he explains. "If you only want to make a few hundred of something, roll out a new model at the last minute or fill a new order, you can do that quickly here. It's closer to your main customer base in the U.S." It also protects competitive advantage. "If you take innova- tion to a Chinese factory, it will be copied," Ewert-Johns says. Made-in-Canada products have a luxury cachet, especially in Asia, he adds: "It's why compa- nies like Canada Goose maintain their Canadian production." The challenge is finding the talent to keep operations in Vancouver humming. In a recent study, Ewert-Johns found that the B.C. apparel industry needed 438 sewers in 2016, a number he projects will climb to more than 1,500 by 2025. Arc'teryx runs a full-time training module at Arc'One because skilled workers are impossible to find. "The apparel industry in Vancouver has tradi- tionally been built on the flow of immigrants, and the flow is not there," Chan says. That's why there are no plans to bring more production to Arc'One. Instead, the facility helps Arc'teryx focus on industry- leading design. "We make a lot of cool stuff in B.C. because we have to," Ewert-Johns says. "You have to be find a cool niche, and you have do it really well. In the eyes of the buyer, you have to be the best. That's something Arc'teryx has figured out." • That's the estimated share of the $71.5 billion in construction costs for projects under way in this province that are associated with late payment, according to the B.C. Construction Association (BCCA). As April brings the province's first annual Construction Month, independent contractors are struggling under the weight of insurance and loan interest while they wait for clients to pony up, says BCCA president Chris Atchison. "Smaller contractors are refusing to work for certain individuals, or they're chang- ing occupations—which isn't helping our workforce issue," Atchison explains. Ontario enacted prompt-payment legislation last December, and B.C. is considering it; meanwhile, the BCCA is pursuing an automated payment system, powered by blockchain technology, that would trans- fer funds instantly on a project's completion. That could boost stability for contractors nation- wide, Atchison says. "We hope this can be the thin edge of the wedge." by Melissa Edwards Build now, Pay Later NUMERoloGY $3.7 BIllIoN 16 BCBusiness ApRIL 2018 A StItCh IN tIME In a February report to the provincial gov- ernment, the BC Alliance for Manufacturing estimated that the province's manufacturing sector must hire 4,765 employees by 2025. The occu- pation with the most vacancies: industrial sewers. 530 Retirements 122 Other forms of attrition 1,537 New positions 438 Existing vacancies From 2016 through 2025, B.C. will need new sewers 2,627 SOURCE: BC ALLIANCE FOR mANUFACTURINg