Temiskaming Shores is poised to benefit from a partnership with a multi-national European company that has a strategic growth plan for North America.
But don't say IKEA.
A report in Northern Ontario Business last January confirmed officials from the Swedish home furnishing giant were in the area scouting out possible locations for a value-added manufacturing facility. Rumours abound, but no Northern Ontario municipal official ' whether in Temiskaming Shores or Thunder Bay ' will confirm they are trying to convince IKEA to fit into their backyard.
But if and when the conglomerate, one of the largest companies in the world, comes a-knocking, the project developer for the Temiskaming Shores Strategic Economic Development Unit will welcome it with open arms.
John Gauvreau confirmed last year IKEA officials were in the area, but he can't do the same in speaking of negotiations the city is currently conducting with a furniture retailer that shall remain nameless.
"They are a company that has some serious (North American) growth planned for the next five to 10 years," he says.
The company wants to increase its retail presence in New York City from two to seven locations. In order to bring on the growth spurt, the company requires manufacturing facilities, and believes Northern Ontario is the place to build them.
"They feel that we are very well-situated geographically to take care of the stores which could open throughout the eastern seaboard."
Wood, now considered a by-product of dimensional lumber production, mostly one-inch by two-foot and one-inch by three-foot pieces, is becoming a hot commodity.
Under a value-added direction, a company can remanufacture those pieces into assembled furniture, a venture with a much higher profit margin than recycling the 75-per-cent finish into pulp.
Gauvreau has been exploring value-added wood manufacturing opportunities, worth an estimated $15 million, which have spawned from earlier discussions with another company.
The onerous tasks of erecting a 100,000-square-foot facility, filling it with equipment and bringing transportation companies are slowing things down a bit.
"(But) we are still working on it," he says. If an announcement is made before Canada Day, Gauvreau says the following spring should bring construction development.
Forestry industry attracted investors
The Temiskaming Forest Alliance's work in policing the local forest, ensuring sustainability through responsible forest management practices, has piqued the interest of foreign furniture executives. Company executives would like to be more closely aligned with such initiatives, Gauvreau says.
Gauvreau's department is also wooing other smaller businesses. Larger companies tend to have volumes that are exceptionally high with low margins because everything they sell is price-driven. Gauvreau has to wonder whether the "very low margins are worth the very high effort."
If the municipality could obtain a high margin without losing all their wood supply to one company, they may opt for it.
Ongoing discussions indicate it is a tightly run company with the philosophy of keeping things simple. Executives traveling stay in economy rooms, and ride trains instead of planes, so they can pass the savings down to the customer.
"They are frugal."
