Sharing Trade Secrets

Canadian kitchen supplier matched with U.S. buyer

February 17, 2006

In search of the ‘right’ high-end kitchen cabinetry supplier, Lee Lumber, one of Chicago’s largest pro-dealers, decided to look north of the border. The result: an international partnership that has the potential to become the largest account for Ontario-based Irpinia Kitchens.

Since 1960, Irpinia Kitchens has built an international reputation as a leading manufacturer of high quality kitchens. It was Irpinia’s attention to detail—from the dowels the company uses to square individual pieces to the exotic paints and veneers that coat its finished products—that attracted Lee Lumber.

Models from Irpinia Kitchens

The business connection was made through the Canadian Consulate General in Chicago and Canada Mortgage and Housing Corporation (CMHC) in Toronto.

Lee Lumber had already been working with Canadian lumber suppliers when it approached Trevor Smith of the Canadian Consulate General in Chicago for the names of firms that could meet its need for high-end cabinets. Smith contacted Paulina Barnes, Senior Trade Consultant with CMHC International in Toronto, who then qualified companies based on the buyer’s specific needs and suggested Irpinia Kitchens as one of the potential suppliers. Barnes then organized a visit to Irpinia's production facilities, where Lee Lumber was able to confirm Irpinia’s commitment to quality and choice—both in finishes and wood species.

Irpinia Kitchens Vice President Marcello Marcantonio says the Canadian government was critical in identifying the business opportunity. “There are a million companies out there,” he says. “Without the support of the Consulate General and CMHC in bringing this prospect to the surface, we would never have known it was there.”

Within three months, Irpinia had a deal to offer cabinets through Lee Lumber’s Spaces & Views showrooms.

“Our role is to get the buyers and sellers together,” says Trevor Smith, Business Development Officer at the Canadian Consulate General in Chicago.

A history of exports

Irpinia began shipping its goods to the U.S. in the late 1980s, and now credits about 80% of its annual sales to exports. The company continues to invest in infrastructure to meet the growing demand. In the past three and a half years, Irpinia has invested some $10 million in a new 75,000-square-foot manufacturing facility and its related technology. Its custom cabinetry can now be finished using the precision of a robotic paint line. About five acres of its Richmond Hill site (located north of Toronto) have already been earmarked for expansion plans.

Barnes says that Irpinia’s established reputation in the U.S. market helped the company earn the recommendation for the work.

“We looked at the product requirements specified by Lee Lumber and then identified the appropriate manufacturers based on their export experience,” says Barnes. “Not only was there a fit with Irpinia’s product but its commitment to the U.S. market has been exceptional.” In Chicago, the competition in the high-end kitchen cabinetry business is mostly European, hence the need to identify quality Canadian companies that have the right products and are savvy in the export business.

CMHC International offices in Toronto, Montreal, Vancouver, Calgary and Halifax facilitate lucrative export deals each year, and continue to seek new suppliers of Canadian-made building materials for U.S. markets. In addition to finding Canadian exporters who can meet U.S. needs, CMHC International also helps pre-screen prospective buyers to ensure they have a specific need to fill.

Shipments made, lessons learned

“Of course, knowledge of a business opportunity is only the beginning. A company’s level of service is the key to securing a larger share of the U.S. market, particularly in the era of a strong Canadian dollar,” says Marcantonio. “For example, the Canada-U.S. border presents several challenges to shipping and logistics needs, and some of Irpinia’s lessons were learned the hard way. When it first began exporting products, the manufacturer secured a showroom in Denver. But it had yet to identify other customers along the transportation corridor,” he says.

“The first four markets anyone should have under their belt are New York, Los Angeles, Chicago and Florida,” Marcantonio says in retrospect, referring to various transportation corridors stretching between Ontario and the U.S. “Once those hubs are in place, exporters are in a better position to source business in smaller centres along the way.”

By consolidating shipments within a defined area, it’s possible to control the transportation costs that can affect a customer’s profitability, and Irpinia has made significant investments in software to ensure orders are properly filled––from the point of sale to the final shipment.

 “You’ve got to measure twice, cut once,” says Marcantonio, using an old carpenter’s adage. That said, there is success to be found in a market 10 times the size of Canada. After all, Irpinia opened with 11 employees in 1960 and now has 100—75 of whom work on the production floor—and its distribution network of nine U.S. dealers just three years ago has grown to 23.

For more information, contact:
Paulina Barnes
CMHC International
Email: pbarnes@cmhc.ca
Website: www.cmhc.ca

Marcello Marcantonio
Irpinia Kitchens
Email: sales@irpinia.com
Website: www.irpinia.com

Trevor Smith
Canadian Consulate General in Chicago
Email: trevor.j.smith@international.gc.ca
Website: www.chicago.gc.ca