The booming business of beauty boxes

By Tamsin McMahon - Wednesday, May 16, 2012 at 11:45 AM - 0 Comments

Reena Newman

It’s hard to dream up a better business model than convincing customers to pay hundreds of dollars a year for products they could otherwise get for free. That’s precisely the idea behind “beauty boxes,” a lucrative online business that has been exploding across Canada in recent months. Cosmetics firms, keen to get exposure to a wider audience, donate samples of lipstick, face creams and perfume to beauty box companies, who repackage four or five of the samples and sell them to subscribers for anywhere from $10 to $15 a month.

At least six such companies have started up in Canada in the past year, joining dozens more in the U.S., Europe and even India. Toronto-based Luxe Box and Montreal’s Glymm both launched subscription-based beauty sampling boxes last year. They’ve since been joined by U.K. import Glossybox, U.S.-based Beauty Box 5 and Julep, a box dedicated entirely to samples of nail polish. Topbox, another Canadian start-up, boasts a four-month wait-list for its samples.

In return for donating their samples—which they would normally give out for free at department stores—cosmetics companies are handed a goldmine of market research based on detailed “beauty profiles” filled out by subscribers when they sign up. Companies say that offers a better way for brands to track where their samples go, how well they’re received and whether they turn into sales.

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Did Ikea hire political prisoners in Communist countries to make furniture?

By Chris Sorensen - Wednesday, May 16, 2012 at 11:34 AM - 0 Comments

With its whimsical ads, clever product displays and giant ballrooms for the kids, furniture giant Ikea generally enjoys a positive reputation among consumers, even if they grumble about confusing assembly instructions and missing Allen keys. This is, after all, an outfit whose biggest public scandal to date was its decision to change the font in its 2010 catalogue.

Which makes the controversy now enveloping the company in Europe all the more unusual. Ikea is being accused of using political prisoners in the former East Germany and other Communist countries to make some of its furniture in the 1970s and 1980s. The allegations, first reported by German public TV channel WDR last year, and amplified last week by another TV program in Sweden, have prompted Ikea to launch its own investigation of old Stasi secret police files.

While Ikea is known to have sent manufacturing work to some former Communist East European countries starting in the 1960s, WDR suggested some of those factories were actually operated by prisoners. “The program identified one East German factory located next to a prison in the town of Waldheim, where Ikea’s popular ‘Klippan’ sofa was produced,” according to a report in Britain’s Independent newspaper. “A former prison guard told WDR that furniture production was part of prison labour.”

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Apple wants the iPad to be the next must-have business tool

By Gabriela Perdomo - Tuesday, May 15, 2012 at 9:58 AM - 0 Comments

Simon Hayter

After only two years in the market, Apple’s iPad has been a remarkable success, cornering 68 per cent of the global tablet market, with 11.8 million units sold in the first quarter of 2012 alone. But to really secure its place as the king of tablets—and to prove its device is more than just a consumer toy for Web browsing and playing games—Apple is planning to conquer one final frontier: the business world.

The company has launched an aggressive global campaign to lure developers into building more business applications for the iPad. One of the centres of this push is Vancouver, home to a thriving community of software companies that have created successful consumer apps for Apple’s iOS platform, used on the iPhone and iPad. Apple is organizing regular developer meet-ups in the city with thousands of participants and inviting software companies to showcase their business apps to sales staff at Apple stores.

Angela Robert is CEO of Vancouver-based Conquer Mobile, one of the companies that is now focusing solely on developing business apps for the iPad, like Colligo Briefcase, which helps view, share, and edit content in a secure environment. Robert says she’s never seen Apple come after developers so aggressively. (With consumer apps, it was usually developers courting Apple.) She says the current offering of business apps is, so far, insufficient to convince company decision-makers that they need iPads. “It’s just like [Apple] did with the iPhones,” says Robert. “People bought iPhones only after they saw all they could do with apps.”

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One-time Cadbury heiress sells her mansion to fund chocolate venture

By Tamsin McMahon - Tuesday, May 15, 2012 at 2:27 AM - 0 Comments

Adrian Sherratt/Alamy/Getstock

It didn’t take long for the British media to dub the move “sweet revenge.” Felicity Loudon announced this week that she had sold her $48-millon mansion in the Cotswolds in order to fund a new chocolate bar venture. The interior decorator and one-time heiress to the Cadbury chocolate empire vowed to use the proceeds to launch a new British chocolate company after shareholders approved an $18.5-billion bid by U.S. food giant Kraft to buy Cadbury in 2010. Although started by her great-great-grandfather, John Cadbury, the chocolate company hasn’t been family owned for 50 years and Loudon, 62, was a minor shareholder. But not one to sugar-coat her words, Loudon called the sale of Cadbury to an American “plastic cheese company” a betrayal of the family honour. She has unveiled few details about her new chocolate venture except that it will be low-cost, “quirky” and above all, British.

Pepsi hopes Michael Jackson is still the king of pop

By Chris Sorensen - Monday, May 14, 2012 at 11:22 AM - 0 Comments

Pepsico’s long-time relationship with the late Michael Jackson has been both lucrative and controversial, in life and death.

Nearly three years after Jackson’s overdose, Pepsi is still counting on him—or at least his likeness—to do battle with archrival Coke. As many as one billion Pepsi cans plastered with Jackson’s silhouette are set to hit store shelves as part of a marketing deal brokered with Jackson’s estate. Not surprisingly, some have called the campaign in poor taste. But others argue Pepsi will cash in with consumers who yearn to remember “MJ” the ultra-talented entertainer, not “Jacko” the tabloid freak.

The irony is that Jackson’s drug problem may be traced to the shooting of a Pepsi ad in 1984. He took painkillers after his hair caught fire following a pyrotechnics mishap. Jackson nevertheless settled with Pepsi out of court for US$1.5 million and continued to appear in Pepsi ads well into the 1990s and, it turns out, beyond. The King of Pop, indeed.

Are CEOs finally due for a pay cut?

By Richard Warnica - Monday, May 14, 2012 at 10:52 AM - 0 Comments

The global economy may not have completely recovered from the financial crash of 2008, but for senior executives, the hard times, if they ever arrived at all, are now nearly over. American CEOs earned an average of US$11 million in total compensation last year. That’s down just slightly from the US$12.4 million they earned in 2007, the last pre-crash year, according to a new analysis by the Economic Policy Institute, a U.S. think tank. In Canada, meanwhile, the 100 best-paid chief executives earned an average of $8.4 million in 2010, a raise of 27 per cent from 2009.

But there are growing signs that largesse isn’t sitting well, and not just with the Occupy movement. Investors worldwide are protesting more vocally about executive pay. More than half of Citigroup shareholders voted to reject a US$15-million pay package for CEO Vikram Pandit in April. (Shares in the U.S. bank have fallen more than 80 per cent since Pandit took over in 2007.) In the U.K., Barclays’ shareholders heckled board chairman Marcus Agius at a recent annual meeting, while investors in U.S. natural gas giant Chesapeake Energy, CIBC and other firms have been rumbling about similar revolts in recent months. It turns out that institutional investors, too, are part of the 99 per cent.

‘Clear evidence of a bubble is lacking’—really?

By Erica Alini - Thursday, May 10, 2012 at 1:48 PM - 0 Comments

eric dickman/flickr

Earlier this week the Canadian Housing and Mortgage Corporation published its 2011 Annual Report–which reads like a 184-pages long effort to brush off concerns about Canada’s housing market. “Clear evidence of a bubble is lacking,” the document proclaims at one point, after liberally sprinkling the words “solid,” “sound,” “responsible” and “prudent” throughout the previous 30-some pages.

Well, signs of a bubble are rarely “clear.” As Finn Poschmann, of the C.D. Howe Institute, told Bloomberg on Tuesday, it’s always difficult to tell whether a bubble has formed until it goes “pop.” This is partly why bubbles, especially in real estate, continue to happen even though you’d think someone at some point would have learned the lesson.

But let’s take a closer look at the CMHC’s no-bubble-no-worry argument. The housing agency seems to argue that the housing boom of the last decade was largely warranted by the fundamentals, i.e. important and independent underlying demographic and economic factors. Specifically, among other things, the CMHC notes that:

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Can’t afford to own a race horse? Buy a share of it.

By Katie Lamb - Thursday, May 10, 2012 at 10:11 AM - 0 Comments

Charles Bertram/Herald-Leader

Ray Bouchard always loved horse races and for the past 37 years he’s watched his thoroughbreds run for small purses at Manitoba’s blue-collar raceway, Assiniboia Downs. But the farm equipment dealer from Winnipeg had every racing fan’s biggest dream come true when Animal Kingdom, a horse he part-owns, won the 2011 Kentucky Derby, which many consider “the most exciting two minutes in sport.” Along with the horse’s 19 other owners, Bouchard took home a piece of the US$2.1-million prize. “The experience of walking onto the infield of Churchill Downs and 170,000 people are cheering and looking at the winner’s circle and you’re sitting in it—it’s a surreal feeling,” recalls Bouchard. He is only the third Canadian to own a Derby winner.

Exactly how a Winnipeg tractor salesman found himself in such exalted company is the result of a fundamental shift in the world of international horse racing. A growing number of Wall Street-style investment partnerships have sprung up to allow investors to buy shares in horses and have a slice of a world once only accessible to sheiks and oil tycoons. It’s a booming industry that has attracted the likes of Canadian billionaire Frank Stronach. And while the investment stakes are high, for some horse racing enthusiasts, like Bouchard, the chance to own even a small share of a horse in the “run for the roses” in Kentucky is worth the risk.

There’s a reason it’s nicknamed the sport of kings: with training fees, vet bills, transportation and insurance, maintaining a racehorse adds up to roughly $40,000 a year. And that doesn’t include the horse’s purchase price. But the partnerships, which are set up like pooled investment funds for horses, are democratizing the sport similar to the way mutual funds brought stock investing to the masses. “It’s getting into the sport at the upper echelons in an affordable manner,” says Bouchard, who co-owns last year’s winner through an ownership syndicate called Team Valor International, which sells shares in some of its horses starting at $6,000.

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Pop-up goes the shop

By Tamsin McMahon - Thursday, May 10, 2012 at 9:42 AM - 0 Comments

Chris Young/CP

Maybe it’s a sign of our disposable culture that the temporary storefront has become a permanent fixture of the retail landscape. Pop-up shops, stores that set up at kiosks or in vacant storefronts for anywhere from a few hours to several months, have flourished across Canada.

In February, ahead of its Canadian debut next year, U.S. retailer Target offered an exclusive Jason Wu collection in downtown Toronto for just six hours, generating a frenzy among the city’s fashionistas and garnering national attention. Well.ca launched a virtual QR-code pop-up shop in Toronto’s Union Station in April. Skincare company Nivea opened “Nivea Haus” in Toronto and Montreal in March. Even the Food Network ran “pop-up restaurants” in Toronto and Vancouver to promote a show.

Pop-up shops have been around for nearly a decade, inspired by the guerilla marketing tactics of small designers who would temporarily inhabit storefronts, warehouses and alleyways because they couldn’t afford their own retail shops. Target was among the first major retailer to try the pop-up concept when it set up on a barge outside Mahattan in 2002. But while such events were once dismissed as passing fads, the pop-up shop has endured as retailers realize the no-commitment storefront is a cheap way to test new products. They also generate buzz with the novelty of get-it-before-it’s-gone commerce. “It’s a great way to create interest,” says Vancouver retail consultant David Gray of Dig360, who argues the concept isn’t used enough. “What’s going to get harder and harder is for it to remain novel. But it’s still so rare, I think it’s a long way from becoming truly mundane.”

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Big Food companies rush to rejig recipes

By Chris Sorensen - Wednesday, May 9, 2012 at 4:27 PM - 0 Comments

Nati Harnik/AP Photo

Jenna Marie Wakani

With their soft, mashed potato insides and crispy exteriors stamped in the shape of a happy face, McCain Foods’ frozen Smiles are marketed as a fun-to-eat children’s snack. They’re not supposed to explode. And yet, that’s what happened inside the Canadian food giant’s laboratory in Florenceville-Bristol, N.B., as researchers attempted to “reformulate” the Smile’s long list of unpronounceable ingredients, part of a company-wide strategy to make its packaged foods more natural and wholesome.

Tony Locke, McCain’s director of product development, says the trouble began while trying to ditch mono- and di-glycerides, emulsifiers that help retain moisture in some packaged foods. Emboldened by previous success with frozen pizza pockets, Locke’s team added a mixture of yeast, wheat gluten and flaxseed to the Smiles. “It was working very well in the lab,” says Locke, referring to what was the 40th attempt to rejig the recipe. “But then when we went to scale it up, we actually had these little Smiles going down the line in the plant and coming out of the fryer and exploding. They would literally come out of the oil and burst.”

And that, in the form of a combustible little potato snack, is the huge and complex challenge faced by food companies as consumers increasingly demand meals that are not only healthier, but more “natural” and therefore, it’s reasoned, better for you. With the public spooked by everything from processed foods (too much salt, too many additives) to hormone-raised beef, food producers are suddenly bending over backwards to portray themselves as purveyors of local, fresh ingredients, and their suppliers as earthy, family-run outfits, as opposed to giant factory farms. The phrases “all-natural,” “naturally raised” and “cage-free” are everywhere.

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Surprise, surprise: Canada lags in e-commerce

By Peter Nowak - Wednesday, May 9, 2012 at 2:02 PM - 0 Comments

Keith Williamson/Flickr

The government’s Standing Committee on Industry, Science and Technology has released its report (links to PDF) on e-commerce in Canada, titled “Pursuing the Promise.”

It paints the same picture we’ve known for some time now–that despite Canadians being among the most prodigious users of the Internet, they really aren’t doing much online business-wise. With the amount of effort the government has put into this area, a more accurate title for the report might therefore be “E-Commerce in Canada: Half-Assedly Pursuing the Promise.”

Canadian businesses are investing 40 per cent less in information and communications technologies, or about $2,400 less per worker, than American businesses, the Committee heard from witnesses. Some of that has contributed to the fact that only 1 per cent of retail expenditures in Canada are from online transactions, compared to 8 per cent in the United States.

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The DVD is hardly dying

By Jaime Weinman - Wednesday, May 9, 2012 at 11:32 AM - 0 Comments

Richard Levine/Alamy/Get Stock

DVDs should be over by now. Jason Ropell, vice-president of content for Netflix, says it’s “incontrovertible” that the future of video consumption will be Internet streaming on demand. So why is it that some of the biggest players in home video today are DVD rental kiosks like Redbox, the U.S. rental giant, or Movie Magic and zip.ca, whose machines rent out DVDs to people in supermarkets and drugstores across Canada? Redbox alone has close to 30 million active customers using its DVD service.

The collapse of DVDs was real enough when it came to buying those little discs. The DVD boom of the last decade when, Ropell says, “you’d walk into people’s houses and they’d have a whole bookshelf filled with DVDs with the spines out, like books,” ended long ago. Brahm Eiley, from the media consulting company Convergence Consulting, says sales have been in decline since 2006.

But just because people don’t want to buy DVDs doesn’t mean they don’t want them. When Netflix tried to spin off its U.S. DVD rental business into a separate subscription service, Qwikster, it was hit with so many customer complaints that it had to back down. Even Ropell admits that some customers just don’t want to give up on the physical disc: “There are people who say, ‘I just like seeing the DVD show up in the mail.’ That’s not a logic-driven preference.” Redbox has discovered that if you put DVD rentals in easy-to-reach places and charge a low price for them ($1 per rental in the U.S.), people will keep on renting them and bringing them back. According to a report in the Los Angeles Times Redbox boasts that its kiosks are a five-minute drive or less from 68 per cent of Americans, and it seems that many people still find a five-minute drive more convenient than loading up a movie online.

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Is the smartwatch going mainstream with Pebble?

By Jaime Weinman - Wednesday, May 9, 2012 at 10:51 AM - 0 Comments

Your wrist is ringing

Once upon a time, you carried your watch in your pocket. Then it migrated to your wrist. Now the same thing may be about to happen to the smartphone. In April, Vancouver native Eric Migicovsky used the crowd-funding site Kickstarter to request start-up money for the Pebble, a wristwatch that will connect to an iPhone or Android and display emails, messages, and apps. The Pebble instantly became a fundraising phenomenon, racking up more than $7 million in contributions, a Kickstarter record.

When it’s ready to ship, the Pebble won’t be the first smartwatch. It won’t even be Migicovsky’s first, since his California-based company, Allerta, already marketed the Inpulse, a watch that told you when your BlackBerry had a message. But according to Wired magazine, smartwatches “haven’t really caught on with mainstream buyers,” so no major investors wanted to put money in the Pebble. Migicovsky, who studied at the University of Waterloo before moving to the States, told the blog Reyhani Law that he went to Kickstarter only because he “tried the traditional route and it didn’t work.” The Kickstarter bonanza was the first sign that the smartwatch is going mainstream.

What can a smartwatch do for you that a regular phone can’t? Well, for one thing, it spares you the need to reach into your pocket. Migicovsky said he came up with the idea for the Pebble “when I was cycling and I wanted to not drop my phone while riding.” The apps being developed for the watch are aimed at people who can’t hold a phone in their hands: there’s a GPS app for bike riders and a system for golfers to find their way around the course.

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A Greek exit: Good idea, hard to do

By Erica Alini - Tuesday, May 8, 2012 at 4:45 PM - 0 Comments

It may be time for Greece to leave the eurozone. Analysts have been saying since late last year that a Greek exit, now known as “Grexit” among economics dorks, was a likely scenario. Last weekend’s messy elections and this morning’s bombshell statements by the country’s left-wing Syriza bloc make it all the more likely. So what would a Grexit actually look like, and would it be good or bad for Canada and the rest of the world economy?

The short answer is that letting Greece slip out of the eurozone is a good idea in theory, but a hard one to pull off without disastrous consequences in practice. David Smith, economics editor of The Sunday Times, summed it up nicely in a post he wrote before the election results came out:

“A Greek exit, should it occur, would eventually be good for Greece and remaining eurozone members. Getting there, however, without triggering a domino effect, and without a hugely damaging impact of the banking system, is the difficult part.“

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A Chinese automaker boasts about its war credentials

By Charlie Gillis - Tuesday, May 8, 2012 at 2:12 PM - 0 Comments

Zhongxing, a Chinese automaker, set a new standard for tin-eared marketing last week with an auto show display that billed its pickups as the go-to vehicles of the Libyan war. The exhibit at the Beijing Motor Show featured a 4×4 that rebels favoured for ferrying machine guns, along with the slogan “Tougher than war.” In the background: rolling footage, on giant LED screens, of Zhongxing’s battered vehicles amid the chaos of the uprising—including a clip showing rebels positioned on a desert highway in the trucks, wreckage around them and plumes of smoke in the distance. Other brands have gained similar notoriety (Libya’s border war with Chad in the 1980s was dubbed the Toyota War). But they at least sought to downplay their trucks’ adaptability to war zones. Not Zhongxing. The Baoding-based company highlighted the logos on the big screens in Beijing, lest its product be mistaken for someone else’s.

Mexico City offers free WiFi in exchange for doggie-doo disposal

By Jason Kirby - Monday, May 7, 2012 at 10:23 AM - 0 Comments

Mayu ;P/Flickr

It can be a challenge to get dog owners to pick up after their pets. So Mexican Internet firm Terra and ad agency DDB Mexico are using a reward system—free Internet access in exchange for properly disposing of doggy doo. Under the initiative, 10 Mexico City public parks have been outfitted with special dog-poo receptacles that also broadcast wireless Internet signals. Each time someone drops a bag of waste in the bin, it begins transmitting a WiFi signal to everyone in the park for several minutes. In an amusing online ad for the program, a dog owner shakes his dog’s rear end. “I need to send an email,” he says. As the marketing blog Creativity notes: “In an age when people are probably more interested in staring at their smartphone than watching what their dog is doing, this is a smart idea.”

The companies acknowledge the WiFi signal can be triggered by dumping any garbage into the bin, but they note that doing so still helps clean up the parks.

Budweiser contest offers hockey tickets for life

By Emma Teitel - Friday, May 4, 2012 at 12:22 PM - 0 Comments

Budweiser may be one of Canada’s bestselling beers, but a recent promotion—made especially for the NHL playoff season—could leave beer drinkers with a foul aftertaste. The company’s Canada-wide “Playoff Payoff” promotion, which offers participants the chance to win hockey tickets “for life,” isn’t exactly kosher with the NHL itself. The league (whose official beer partner is Molson) issued a statement on the Edmonton Oilers website on April 24, distancing itself from the campaign: “You may have heard about a contest promoting the chance to win ‘hockey tickets for life.’ We want our fans to know that neither the Edmonton Oilers nor the NHL have an affiliation with that promotion.”

In short, the NHL won’t back up Budweiser’s promise. Or as Hockey Blog in Canada pointed out, since Budweiser is not an official sponsor of the NHL, it’s unlikely a hockey team whose tickets sell out pre-season (like the Winnipeg Jets) will be obligated, or even able, to provide an unaffiliated contest winner with tickets.

For its part, Budweiser issued a statement that it will “deliver” on the promise, while highlighting the fine print—those free tickets don’t necessarily have to be for NHL games. A final word to Bud drinkers: OHL, here you come.

Are Americans getting too cozy with debt again?

By Gabriela Perdomo - Thursday, May 3, 2012 at 12:33 PM - 0 Comments

SS&SS/Flickr

They were supposed to be wary of debt, but data show borrowing among U.S. consumers is growing again. A number of analysts and media outlets are hailing this as a sign of newfound “consumer optimism,” but a closer look at the numbers leaves little reason to cheer.

Though credit card debt has been decreasing, the latest data from the Federal Reserve, which exclude mortgages and home equity loans, borrowing for cars and student loans has soared. Overall, consumer borrowing outside real estate increased by US$8.7 billion in February of this year—topping a six-month upward trend that saw a staggering increase of US$18.6 billion in January.

The Associated Press notes that “consumers are taking on more debt at a time when their wages have not kept pace with inflation. And they are paying more for gasoline.”

Not that Canadians have anything to teach Americans here, but it’s still legitimate to ask: What does this mean for the U.S. recovery? It depends on who you talk to.

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IKEA introduces the Uppleva entertainment system

By Jason Kirby - Thursday, May 3, 2012 at 10:07 AM - 0 Comments

It used to be that when Ikea adorned the display furniture in its showrooms with TVs and stereos, the company used hollow plastic props. How times, and cheap electronic components, change. Ikea has unveiled the latest product coming to its showrooms—furniture with the TVs and stereos built right in.

The pitch from the Swedish home furnishing giant is simple—already cramped living rooms are choked with wires and cables criss-crossing the walls and floors. The solution, says Ikea, is the Uppleva, an integrated unit complete with LED TV, sound system, wireless bass speakers and CD, DVD and Blu-Ray players, all internet-ready, at a price of around $960.

To be sure, this isn’t a system for audiophiles. And many will bristle at memories of trying to assemble those book shelves in their first apartments. But the company is betting enough people are fed up with the clutter that they’ll take a look. Oh, and it comes in beech, white, black, green and purple.

Starbucks now serving a billion latte sippers in China

By Chris Sorensen - Thursday, May 3, 2012 at 10:04 AM - 0 Comments

Greg Baker/AP

It wasn’t long ago that Starbucks’ big plans to expand throughout China ran into an embarrassing hitch. The American coffee giant, which first entered the market in 1999, stepped into a scandal five years ago after a local TV personality complained that a store erected on the grounds of Beijing’s Forbidden City was eroding Chinese culture. A massive protest followed and the company retreated. Now Starbucks faces the opposite problem. With more than 570 coffee shops across the country, and plans to open another 1,500 by 2015, CEO Howard Schultz says the challenge is finding ways to prevent enthusiastic patrons from lingering for hours on end—sometimes without even buying drinks. “For a decade, the core business was expats and tourists,” Schultz recently told Reuters. “Without question, the core business today is Chinese nationals.” And they seemingly can’t get enough.

New Brunswick: From miracle to ‘meh’

By Alex Ballingall - Wednesday, May 2, 2012 at 1:56 PM - 0 Comments

Photograph By Blair Gable

Uncertainty hangs over Canadian Forces Base Gagetown in southern New Brunswick. Cuts are coming. “It’s kind of scary,” says Rick Jenkins, 45, a shop steward for the Union of National Defence Employees at the base. “We’re not being told when we’re going to know,” he says. “It’s just unknown.”

For a province hailed for its “miracle” economy 15 years ago, this has become the order of the day. Canada’s major banks are predicting the province is in for some of the weakest economic growth in the country. The Bank of Canada anticipates New Brunswick’s GDP will grow just 1.5 per cent this year, the lowest of any province. Alberta, by contrast, is expected to grow 3.4 per cent. In 2011, the provincial economy incurred a net loss of more than 4,100 jobs. Last month the unemployment rate rose to 10.2 per cent, while in Canada as a whole it inched down to 7.2 per cent.

It wasn’t supposed to be like this. Under former Premier Frank McKenna’s reign, from 1987 to 1997, the province balanced its books and enjoyed a boom in call centre and technology jobs. The “McKenna Miracle,” as it was called, set New Brunswick apart from its Maritime brethren. In the years since, though, the province came to rely overwhelmingly on the public sector for its growth. Now the federal and provincial governments have slammed on the brakes in an effort to tackle deficits. Transfer payments from Ottawa to New Brunswick have flatlined after a decade of annual increases of more than five per cent, while the defence department recently announced at least 120 civilian jobs will be lost in the province. Other federal departments are expected to dramatically downsize in New Brunswick, while the province itself plans to shed 1,500 positions over the next three years.

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How the housing market is pumping up our GDP numbers

By Erica Alini - Tuesday, May 1, 2012 at 3:00 PM - 0 Comments

The latest GDP numbers, released yesterday by Statistics Canada, caught everyone off guard. The Canadian economy dipped 0.2 per cent in February, surprising most economists, who’d been predicting GDP would inch forward by roughly the same magnitude. Most surprised of all must have been Bank of Canada governor Mark Carney, who had projected 2.5-per-cent annual growth rate for the first quarter. “It looks like the Bank of Canada jumped the gun,” quipped CIBC in a note to clients, adding that “the report suggests that the Canadian economy isn’t out of the woods just yet.”

The disappointing numbers seemed to be tied in large part to sluggish performance in the mining and oil industry, which, as Maclean’s wrote last week, just can’t seem to be able to get their due from the commodities boom. Luckily, there were a couple of sectors that defied the general downward trend and softened the February drop. One of them was—you guessed it—housing. Take a look at this chart from the StatsCan release:

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Someone gave Peter Pocklington some more money

By Richard Warnica - Tuesday, May 1, 2012 at 10:57 AM - 0 Comments

In some ways, the most startling part of this story may be that someone gave Peter Pocklington money again. The former Edmonton Oilers owner and one-time most hated man in Canadian hockey has had a string of financial problems since losing his team in 1998. He declared bankruptcy in 2008. He was charged with bankruptcy fraud in California in 2009. To top it all off, he pleaded guilty to perjury in 2010.

Now Pocklington, a resident of California, is in trouble again. He’s been accused of securities fraud in Arizona. According to documents filed with that state’s Corporation Commission, Pocklington and partner John McNeil overstated the amount of gold they could recover from a surface-mining operation in La Paz county. Using estimates investigators allege are faulty, the two raised more than US$4.8 million from investors.

Securities officials have asked the commission to levy cease and desist orders, fines and restitution payments against the pair. But Pocklington denies doing anything deliberately wrong. “Any errors made in the past were born of inexperience and naïveté, not malice or avarice,” he wrote in an email, “and they were quickly rectified.”

Europe on growth: All together now?

By Gabriela Perdomo - Friday, April 27, 2012 at 3:13 PM - 0 Comments

(Markus Schreiber/AP Photo)

Last week, we wondered whether Chancellor Angela Merkel and other German officials were too stubborn to notice that their push for austerity is choking Europe’s economy. There’s a chance they aren’t.

On Wednesday, European Central Bank President Mario Draghi called for a European “growth compact,” acknowledging that fiscal austerity is “starting to reverberate its contractionary effects.” Merkel agreed with Draghi, though she immediately specified what type of growth she would–or rather wouldn’t–like to see:

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What does it take to boost a company’s green cred?

By Kate Lunau - Friday, April 27, 2012 at 12:16 PM - 0 Comments

Photograph by Brian Howell

Wade Janzen has a worm composter under his desk. Most employers might discourage vermicomposting at the office, but the Vancouver Aquarium is an exception. “I learned how to make a compost [in a workshop] on my lunch hour,” says Janzen, 30, the aquarium’s coordinator of curriculum. He plans to give away the worms (which process organic waste into fertilizer) to teachers as an outreach project in local schools. “It’s really nice working here, where we’re supported in our efforts to live sustainably,” he says.

The Vancouver Aquarium is one of this year’s “Green 30”—organizations whose employees are most positive about their record of environmental stewardship, according to Aon Hewitt. The global consulting and outsourcing firm surveyed more than 112,000 employees in Canada, asking them about their employers’ commitment to the environment. Among the 30 that came out on top—including the Vancouver Aquarium, Lush Fresh Handmade Cosmetics, Mountain Equipment Co-op, and Nexen Inc., an oil and gas company—82 per cent of employees have a positive perception of their employers’ eco-friendly initiatives, the survey found.

The Green 30 list provides an “inside view” into a company’s practices, since it shows how its own employees view it, says Aon Hewitt partner Neil Crawford, leader of the Best Employers in Canada study. Green initiatives not only help attract and engage workers; they’re appealing to the public, too. “It’s good business to say you’re socially and environmentally responsible,” says Crawford. For companies at the top of the list, expectations around being green are set high.

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