Edmonton firm warms up to growth potential in Cuba
"Not many people would think, 'Let's go and sell our products in Cuba.' But I think it’s important to diversify. Why does everything have to be sold here in Canada?” asks Sherri Janssen, general manager of Edmonton's Promotional Wearhouse Inc.
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Cuba’s picture-perfect beaches and the bustling streets of steamy Havana are a long way from snowbound Alberta.
But with oil prices in the ditch and Alberta’s energy-driven economy in a funk, local entrepreneurs Larry and Sherri Janssen are warming up to the idea of doing business in the communist country.
The friendly husband-and-wife team own and operate Promotional Wearhouse Inc., a 37-year-old Edmonton firm founded by Janssen’s father. It sells corporate apparel, industrial safety clothing and more than a million customized, logoed promo items.
The latter includes everything from tote bags and hotel slippers to coffee mugs, shampoos, napkins, coasters and flashlights. The firm’s stylish ball caps, made in Asia, have been worn by U.S. President Barack Obama, Wayne Gretzky and Willie Nelson, among others.
Larry Janssen, a former Sears manager, joined the company in the 1980s and it has thrived ever since, catering mainly to corporate and government clients, with about 20 per cent of its revenues derived from oilsands firms.
But the stunning crash in oil prices has taken a toll, cutting the company’s oilsands-related business in half. So when Janssen received an unexpected call last year asking if he’d join a federal trade mission to Cuba, his ears perked up.
Although Cuba’s tourist resorts are booming, they don’t carry the kind of quality merchandise or apparel typically available in places like Hawaii or Mexico. The Cuban government wants to change that.
“If you go down to Cuba and started knocking on doors to try to sell something like that, it would be an absolute total dead end,” says Janssen. But as part of a federal trade mission, he says he was welcomed with open arms.
“Their big push is for tourism, their No. 1 industry, and within that, their big push is for golf resorts. There’s only a few golf courses in Cuba and they have no source for anything like pro shop apparel, equipment or balls,” he says.
“So we’ve been told if we work out, we’ll be the exclusive supplier for anything related to golf. Whether that’s pie in the sky or not I guess we’ll find out, but they seem sincere.”
Even better, once the Cubans discovered the Janssens’ firm also supplies safety apparel and industrial clothing, their interest spiked even higher.
“As Cuba tries to diversify a little bit and encourage joint ventures with companies from Spain, Venezuela and Argentina, they bring along industrial standards with them. So you can’t have guys going into a nickel mine in jeans and sneakers,” he says. “They have to adhere to safety standards, and that’s where the market is blossoming.”
No firm deals are signed yet, but the future in Cuba looks promising, says Janssen. More promising than it does right now in Alberta.
So what is Sherri Janssen’s advice to other Edmonton companies that are struggling to survive in a tough local economy? “Think outside the box, and don’t just limit yourself to Alberta,” she says.
“Not many people would think, ‘Let’s go and sell our products in Cuba.’ But I think it’s important to diversify. Why does everything have to be sold here in Canada?”
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