Big money from small strips
Canplast grew by manufacturing the bands that line cabinet, table and office furniture edges

When Felix Furst came to Canada from Switzerland, with only two suitcases and $500 in his pocket, he never thought that he would one day run one of the country's best-managed companies. And if you had told him that the road to success lay in developing the bands that line furniture edges, he would have looked at you like you were crazy.

"It's a small niche and it's not exactly in the most popular field," Furst, president of Montreal based Canplast said with a laugh. "But we work hard to be the best."

Furst's philosophy may sound obvious, but it's not. When the average Canadian thinks about going into business, his first choices are inevitably the obvious ones: opening a small store or restaurant, doing renovations or buying a franchise.

But more often than not, the really successful entrepreneurs, --those who built up multi-million dollar companies from scratch,-- target markets that most people don't even know exist. Edgebanding is one such area.

Edgebands are small strips of plastic or wood that are printed with patterns to match the laminates used on engineered wood products.

When workers at furniture factories like Group Lacasse's Ste-Pie de Bagot-based plant cut the panels they use to make desks and other products, the sawed-off edges remain exposed. Applying Canplast's PVC edgebands to the panels' exposed edges gives the entire finish a uniform look.

Edgebands can be found on almost all laminated particle board products, including kitchen and bath cabinets, office furniture and residential furniture.

You'd think that manufactures would apply similar laminates on the sides of their panels as they do on the tops, but that would slow production. As a result, edge-bands are typically produced in rolls and then cut into strips when they are applied.

Furst got into the plastics industry soon after coming to Canada. He was one of the first to make edgebands using plastic rather than paper. Getting his new business off the ground was tough and Furst worked six-day weeks almost from the start.

According to Marco Turcotte, a planner at Groupe Lacasse, Canplast's success is due to three factors: quality, service and price. Although he has been with Lacasse for only 18 months, the company's relationship with Canplast extends back to the 1970s.

"Whenever we buy laminated board products to use in production, we send samples out to suppliers, so they can propose an edgeband pattern that matches the panel design," Turcotte said. "(Canplast) always comes up with good proposals."

Canplast also maintains a large finished goods inventory for Groupe Lacasse, shipping goods on a just-in-time basis so that the furniture manufacturer can keep stocks down to a minimum. But while edge-bands are just one small detail in the finished furniture made by Canplast customers, those small strips add up to big dollars.

During three decades since Furst began producing custom made edge-bands, his company has grown into a North America wide business with 300 employees, $50 million in sales, and production facilities in Montreal, Toronto, North Carolina and Mexico. Last year, the company's success drew the attention of National Post researchers who named Canplast one of the 50 best managed companies in Canada.

And according to Steven Foster, Canplast's marketing and distribution manager, the company is just getting started.

"We are constantly coming up with new innovations to provide more attractive and durable products," Foster said.

The innovations include improving product quality, particularly color consistency, strength tolerances and print fidelity. Canplast's chemists are also constantly experimenting with new materials to give woodprints a more realistic appearance.

According to Foster, more than 75 per cent of the company's sales are exports, with most of those going to the U.S. But recently Canplast has been looking even further.

"We see a lot of potential in Central and South America," Foster said. "We've already started in Peru, Ecuador and Chile and we are targeting Brazil next."

Approximately 75 per cent of Canplast's revenues are generated through the company's internal sales force. Distributors account for the balance, a model that Foster sees as having greater potential in Latin America due to its remoteness.

Canplast's success provides several good clues for aspiring entrepreneurs. The most important success secret is choosing a sector that you like, so that the long hours and tough competition won't discourage you. But if you really want to grow a big and profitable business, then look for a niche segment that is off the beaten path.

 

 

Sidebar: Felix Furst's management strategy

o Concentrate on manufacturing edge-banding products. Resist the temptation to branch out into panels, laminates and moldings.
o Compensate for narrow focus by using total quality management to excel in Canplast's chosen market.
o Keep cash in the company by reinvesting profits in new technology and production equipment.
o Listen to employees and allow them to participate in decision making.
o Stay on the cutting edge by regularly introducing new designs and materials.

 

 

Photo caption: Canplast owner Felix Furst was one of the first entrepreneurs to realize the potential of using plastic rather than paper to make the edge-bands that line desks, tables and kitchen furniture.

Fact Box:
Company Name: Canplast
Web-site: www.canplast.com
Owner: Felix Furst
Founded: 1976
Products: Edgebanding for the kitchen, living room and office furniture industries
Employees: 300
Sales: $50 million
Phone #: 514-327-9555

 

peter@peterdiekmeyer.com

 

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