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Sherky Ng, CEO, of Ikou Inc., a bathroom vanity company that exports their product, is photographed at his showroom and warehouse facility in Markham, Ont., on May 26.Peter Power

Bathroom cabinet and fixture maker Ikou Inc. has had to confront a massive, expensive and unending challenge to get products from its manufacturers in Asia to its North American customers in recent years.

The difficulties for the Markham, Ont.-based company started with the China-U.S. trade war in 2019, and they have been exacerbated by the on-and-off pandemic lockdowns since early 2020, Ikou CEO Sherky Ng explains. “Our main goal is survival right now.”

Mr. Ng says the Gloria Gaynor song I Will Survive has been the company’s mantra during the pandemic.

When the trade war happened, the plant Ikou was using in China closed, forcing Mr. Ng to find new manufacturing options in Asia. The pandemic hit months later, creating havoc across the global supply chain and sending transportation charges soaring. Ikou’s shipping costs skyrocketed from $4,000 per container to $28,000.

The company absorbed the higher amounts for as long as it could, but after losing millions, it had little choice but to raise its prices to help offset the higher fees. Products that were selling for $1,800 nearly doubled to $3,000, Mr. Ng says, adding Ikou is far from alone in having to make this kind of business call.

“There are a lot of companies that are silently suffering and a lot of the retailers really don’t know what’s going on.”

Smaller companies are often hardest hit by global supply chain issues, says M. Johnny Rungtusanatham, Canada Research Chair in Supply Chain Management with the Schulich School of Business at York University in Toronto.

“Small companies don’t have the volume to compete against larger companies,” which have more resources to buy shipping capacity, he says.

To manage supply chain constraints, smaller companies can talk to their biggest customers to see if they can co-ordinate with a shipper to get space on a shipment, Mr. Rungtusanatham says. Or they can work with their suppliers and customers to get more favourable payment options. These are two areas where the federal government can get involved by either helping to co-ordinate shipments or offering financing or short-term zero-interest loans to Canadian exporting companies, he says.

Mr. Rungtusanatham says small companies may also want to consider curbing growth plans to absorb the higher costs rather than racing ahead with expansion that may not be manageable or sustainable.

A few business moves have helped Ikou push through the pandemic-related challenges, Mr. Ng says. For instance, before the trade wars in 2019, Mr. Ng travelled to eight different countries to find new manufacturing facilities. He chose three locations to ensure consistent supply: Malaysia, Indonesia and Vietnam.

Having three factories in different geographic regions gave Ikou a business advantage when the pandemic happened.

“We were one of probably three suppliers left for all of our customers where we could actually supply products to them. So our business actually flourished,” he says, adding that Ikou doubled its business during the pandemic.

The company was also able to build up more inventory and large orders were spread among the three manufacturing plants in case one was shuttered.

“It just reduced risk,” says Mr. Ng, who is no stranger to overcoming obstacles.

After having a brain tumour removed in his final year of high school, Mr. Ng lost his ability to read and write. He struggled while studying business at York University, so he switched to interior design and started creating cabinets. His parents had a factory in Toronto that made countertops and saw a market for high-quality, durable cabinets at an affordable price.

“I had a passion for design, and I knew that I could make a business out of it,” he says. Mr. Ng and his university roommate started Ikou, and he has since bought him out.

Ikou’s first big break was getting a deal with big-box retailer Sam’s Club. Now Ikou cabinets are sold at Costco, Home Depot, Canadian Tire, Lowe’s and Rona across Canada and the United States. Mr. Ng is looking at selling in Britain soon by e-commerce and with Costco U.K.

The business has had “a lot of challenges, but as an entrepreneur, you just have to pivot all the time, find ways to stay alive. I’m always open to try something.”

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