The start of the 1990s

Joe Bichai sits in the in the conference room of the Genfoot Factory in Lachine, Montréal.  This explains why we see winter boots displayed against the white wall behind him.  In this clip, he talks about the economic situation at the beginning of the 1990s.

Transcript:

So, for sure, when everything’s running smooth in the factory, employees are really happy, they’re well paid, their bonuses are good, it’s tough to change something that, at first glance, doesn’t need changing. For sure, when you look at the industry in general, we’re in 1991 now, looking at industry market data, just over the past five years, 45 shoe factories in Canada have shut down.  That’s led to a loss of 6,000 jobs, which is huge.

At that time, it was really easy to determine selling cost. We just had to work out our cost price, add profit onto that.  We went to see the client.  Your boot is going to cost you this much.   No problem, it’s all good.  Now, with other countries coming in that didn’t used to compete with us, the client tells us: no, no, I don’t want that boot, I’ve got another one that looks like it, so maybe it’s not a perfect match, but I got it at this price and I can’t pay a penny more.  So, the notion of selling cost isn’t based on cost price plus profit anymore: it becomes a market price issue.  Knowing that, for sure you had to get ready for the worst and that’s why we said: the time has come to sit down with the employees and talk eyeball to eyeball.