Each week, we seek expert advice to help a small or medium-sized business overcome a key issue.
How do you scale up when your product is a work of art?
Each of her handmade wedding gowns is like a sculpture, says Veronica Di Santo, director of marketing for Ines Di Santo Inc., a mother-daughter company that makes luxury wedding dresses in Woodbridge, Ont.
Ms. Di Santo roundly rejects streamlining production. "We work in the French tradition of couture. The seamstress doing the hand work takes a certain pride in creating it. You can't do the bottom and I do the top and then we put them together. If something isn't right, you need to see it in its entirety to know."
Ms. Di Santo, 39, grew up in the business founded in 1984 by her mother, designer Ines Di Santo. Originally called Chez Moi Fashions Designs, the elder Ms. Di Santo changed the company name to her own 15 years later when she began selling wholesale at trade shows in the United States.
The dresses are sold at their retail store in Toronto's Yorkville neighbourhood, as well as at the new Kleinfeld bridal boutique in the Hudson's Bay store on Queen Street in Toronto (where prices range from $5,000 to $10,000), in Alberta and in New York at Bergdorf Goodman.
Despite ambitions to expand their business and increase sales – their goal is $10-million annually, up from $4-million – they won't take the common path of outsourcing production overseas. The company will add an evening wear collection this fall but continue manufacturing here so they can retain complete control over their product.
"What we do is not always cost effective," the younger Ms. Di Santo says.
The company has about 30 full-time employees, including seasoned seamstresses who work by hand with delicate fabrics, laces and trims. They use PAD System apparel software to customize paper patterns, but otherwise they don't use any high-tech machinery.
They are considering new computer technology for processes such as cutting fabrics. "That's where we could go if we wanted to streamline our production process," she says. "We could add other efficiencies that technology offers."
In addition to the high cost of imported materials and labour in Canada, one of their biggest challenges is finding workers with the refined skills they need. They don't have an apprentice program, but they do bring in fashion interns from Toronto's George Brown College who sometimes end up staying. Ms. Di Santo would like to hire talented designers and pattern makers from France, Italy and the Middle East but is concerned about government changes regarding foreign workers.
"We haven't done it before but we're trying to now," says Ms. Di Santo. "It's frustrating now that there are new restrictions."
The Challenge: How can Ines De Santo grow without sacrificing the quality of its made-in-Canada product?
THE EXPERTS WEIGH IN
Kelly Askew, managing director for retail, Accenture LLP, Toronto
They need to consider how else to take out costs – besides production costs – and grow sustainably. One is looking at outsourcing some of their back office functions, such as payroll, accounting or IT – things that aren't core to delivering the dress experience. They are invisible to the consumer and can deliver savings.
They should also look at product life-cycle management (PLM) to help them more effectively manage the life cycle of each dress product. Again, it's invisible to the customer. There are elements of each dress that are common such as sourcing the fabrics. Industrializing some of those things will let them do it on a larger scale without doubling the number of people to make double the number of dresses.
An apprenticeship program or internal training is a great idea. They can pick up people from the trade programs who have the raw skills and put them on shadow apprenticeships. It's terrific that they're partnered with George Brown but there are multiple fashion programs out there such as Ryerson University's.
They also need to look at how they can construct a career path for employees through the organization so that the top performers can be given more and more responsibility. You've got to have that notion of career path and landing points so that people who have a particular skill set or level of productivity or passion can grow.
Pat Gillespie, owner of Carry Maternity Inc., a boutique with its own made-in-Canada, private label clothing, Toronto
Since they're planning an evening wear collection, mass production of a lower-priced line would definitely help their profit margin. They could put it in other retailers or sell it online. If they go to mass production, they don't necessarily have to do all the work in their own factory. Contracting out in Canada is the way to go since you don't have to interview and secure those workers as your employees. You only have to interview your contractor and make sure their standards are up to yours and that they can meet your deadlines.
There's a fallacy out there that if you want to be pro-Canadian, you're going to pay through the nose. You're also able to do quite short runs if you prefer to keep it small. People are always amazed when I tell them you can do that here and it's still very affordable.
Alan Abramowicz, president and chief operating officer, Samuelsohn Ltd., a Canadian-manufactured premium menswear brand, Montreal
The new government regulations regarding foreign workers are a bit challenging, but since the garment industry has largely moved offshore, there are hardly any qualified people left here at that high level, so you can bring them in. In our facility, we recruited a master tailor from Italy to come to Canada. Ines Di Santo will definitely need to deal with a lawyer, which we did, and deal directly with the government.
Next, it's very important for that person to transition their knowledge to other people. So instituting some kind of formalized training program is essential for them to be a sustainable business that goes on from one generation to the next.
Hand cutting is very costly, plus it's difficult to find hand-cutters these days. It's really a skill that's leaving us. They'll need to make an investment in machinery and equipment. Where the industry has made the most strides is in cutting technology. I'm certain there's a machine that could accommodate their needs, such as a small single-unit cutter or a low-ply cutter where they could put one, two or three garments on at a time. A cutter runs anywhere from $70,000 to $150,000 but if they're going to do evening wear, it would justify the cost.
To improve efficiencies, they could also establish an incentive program where they give the operators the opportunity to work a bit faster for a little more money – maintain the quality but at the same time reduce the cost. Then give some of that saved money back, maybe a third, to the operator. It's an important balancing act.
THREE THINGS THE COMPANY COULD DO NOW
Improve the career experience
Build a career path for your employees so top performers have more responsibility.
Experiment with other lines
Try mass-production methods or contracting out with another line of business, such as an evening wear collection.
Invest in cutting equipment
A small single-unit cutter or a low-ply cutter could cut one, two or three garments on at a time.
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Interviews have been edited and condensed.