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Winnipeg Free Press - PRINT EDITION

Firms find recession's bright side

Manufacturer grabs bigger share of smaller market

By: Martin Cash

Posted: 01/15/2010 1:00 AM | Comments: 0 (including replies)

BORIS MINKEVICH / WINNIPEG FREE Enlarge Image

BORIS.MINKEVICH@FREEPRESS.MB.CA E.H. Price president Joe Cyr (left), with vice-president Cindy Bolduc and head of software Miguel Carrasco, says downturn led to expanded operations.

Faced with a massive decline in U.S. non-residential real estate construction, E.H. Price, the Winnipeg ventilation-equipment manufacturer, didn't pull in its horns.Instead, it expanded its operations, developed new products and increased capital spending.

While commercial real estate development, the main driver of its business, declined 37 per cent in the United States in 2009, Price continued to push hard and it's now the largest company in its field in North America.

"In good times or bad times we keep investing, relentlessly," said Joe Cyr, president of the company. "If there are fewer square feet of construction, then we have to compete in more of the categories."

That meant coming up with 21 new products in 2009 including a new "silencer" unit added to Price's line of grills, registers and diffusers for the HVAC (heating, ventilation and air-conditioning equipment) market. The company also further developed its Wisconsin-based bus-window business and is expanding its software and multi-media business called Anvil Digital into the United States.

Cyr, along with Murray Taylor, CEO of IGM Financial, and Steve Chipman, president of Birchwood Auto Group, spoke Thursday at an event in Winnipeg sponsored by People First HR Services about successfully managing through the recession called the Upside of the Downturn.

Those three firms are Winnipeg-based leaders in three sectors that had their legs knocked out from under them during the recent global economic calamity -- real estate development, financial services and auto sales.

But all three companies emerged in relatively strong positions.

None of them said they were unaffected by the economic downturn, and each had a plan going into 2009. All of them were diligent about retaining their employees.

Price started 2009 with about 2,000 employees, including more than 700 in Winnipeg and 1,000 in the United States where revenue declined by 14 per cent. The company lost only 150 people, many of them departing through attrition.

As a private company, Cyr said E.H. Price can take a longer-term approach without having to worry about quarterly results.

In the case of the auto sector, there were clearly problems present at the beginning of 2009.

Coming off the best year ever in 2008, Chipman said all the company's managers -- at the time Birchwood had nine Winnipeg dealerships and two collision-repair shops -- were asked to tighten their belts.

"Everyone had to come up with a budget five per cent less than '08's and it could not involve any cuts in staff or training expenses," he said. "We had a plan going into 2009 and it gave all our people some confidence and we did not have to pull the ripcord."

In the case of IGM and its sprawling Investors Group mutual fund business, there was no getting around the fact that equity values fell badly and the company's army of 4,600 financial advisers had full-on market turmoil to deal with.

Just prior to the meltdown in September 2008, the company came out with a new vision statement reiterating its commitment to dealing with its clients' long-term financial needs through comprehensive planning, diligence and by being a company of people who care.

"There was no better time to do that," Taylor said.

IGM also tightened its budgets -- but not on the training side -- and increased its communication with clients and staff. It also continued to increase its team of advisers.

"No one ran away because things were difficult," he said. "We had come in with a strong relationship."

The company now has one of the lowest redemption rates in the industry and its stock performance has outperformed the market and the industry sector.

martin.cash@freepress.mb.ca

Republished from the Winnipeg Free Press print edition January 15, 2010 B3

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