Call centre to lay off 270 workers

Ouch. The CBC is reporting this.

Exactly one year ago:

“The government is proud to support SalesBridge as it continues to grow,” Brad Green said. “The company is providing hundreds of highly skilled, well-paying positions for New Brunswickers. Its latest expansion is an indication of the quality and professionalism that can be found in this province’s workforce. We look forward to a long and successful working relationship with SalesBridge in both its Saint John and Fredericton locations.”

The CBC is reporting that SalesBridge did not access that second around of funding because it didn’t hire the workers.

The Business New Brunswick SalesBridge announcement last July was the largest in terms of new jobs in the past four years (by my calculation).

When you have ten of these, one loss doesn’t hurt as much.

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10 Responses to Call centre to lay off 270 workers

  1. David Campbell says:

    Somebody just emailed me to say this is another example why we shouldn’t focus on attracting in foreign business.

    Wrong.

    First, this is an Aliant joint venture – an Atl. Canadian company.

    Secondy, 80% of small businesses fail within five years. Does that mean we shouldn’t support small business either?

    The bottom line here is that the government needs to do its due diligence. Salesbridge only having one client must have been known to the government – and the risk must have been know. At the end of the day, any successful economic development program will have failures. They are just exacerbated when those failures are part of an overall failed economic development program.

  2. Cooker Boy says:

    I’ll add to your reply by stating that the more companies that the province has in the funnel, the greater chance of success we will have. It’s simple math…

    I find it funny that Salesbridge has the same approach as the province in it’s business plan. Put all your eggs into one basket and hope it work… You are right, someone at BNB was not thinking when they saw that the company only had one major client.

  3. MonctonLandlord says:

    Friend of mine said the following this morning:
    “Salesbridge is 51% Aliant and 49% Marketbridge USA. Pretty tough when your only customer is yourself and when Bell takes over, says we are not renewing this office stuff – not our core market.
    Province left on the hook with $1.9 M already paid-out to the company. Ouch!!! “
    Well, hopefully, GNB can collect on Forgivable Loan, hopefully someone kept a copy of the agreement at GNB. I do agree with DC, on business attraction, but GNB needs a better policy, especially one that is actually available to read.

  4. Cooker Boy says:

    What this province needs more than a change of goverment is a purge of BNB. Having dealt with them on a few occasions, they have absolutely not common business sense or willingness to take initiative. Most do not want to rock the boat and gamble their pension. It’s sad…

  5. Anonymous says:

    Again, to get back to a familiar quote ‘its political stupid’. I don’t think one example ever proves a rule for anything. I can tell you that having worked in IT, there are more than just these guys with their ‘eggs in one basket’. Most companies go from contract to contract.

    This is actually a strange story, since grim economic news never bodes well for a sitting government. The company has ‘smaller clients’, so then why wouldn’t it access the second loan in order to enhance its sales force so that its eggs AREN”T in one basket?

    Say what you want, there isn’t a company around that says “one client is plenty, we really don’t need more”.

    It doesn’t mean you don’t necessarily deal with foreign corporations, but it also certainly doesn’t mean that the solution is to deal with them more, that’s almost as crazy.

    As the above commenter said, BNB is pretty backward, this very much comes from unaccountability and lack of political checks. The ‘not wanting to rock the boat’ is quite understandable, that’s not a bureaucrats job-it never has been.

    I had never even heard of this company before, but it shows, once again, just how much investment is centralized in southern ontario-no matter how idiotic the company. In this case though, if they did have one client then at least that’s something that came back to the province-although the final figures will no doubt remain a mystery.

    Keep in mind though, that many new corporate investments are ‘joint ventures’, and many of them are with government and former government companies because they are good places to ‘prop up’ the business.

    However, as a small business man I can tell you that the reason small businesses fail is FAR different than the reason huge companies like this do (and of course the company hasn’t closed its doors yet-no doubt this is a good way to get more offers from government-for contracts, not loans). Also, I can tell you that we DONT support small businesses, not at all. We support ‘medium to medium large’ businesses, but thats it.

    Government wants jobs, and right away, which in many small businesses is the kiss of death. This means trying to grow faster than a solid business plan allows you to grow. If you don’t have employees right away, the government won’t come near you, and banks will laugh in your face. Credit unions are usually a little better, because thats part of their mandate, but that’s far from a political ‘we’.

    As I’ve said, its hard to coax a large company here when you’ve nothing to offer, at least attending to the companies and potential companies that exist here (and can be tailored for export) is a solution that has been proven to succeed. However, whenever that happens we get the “ACOA business failures” books coming out and venting rage at any government investment at all.

    Just again as a quick example, setting up a New Brunswick television station is extremely low cost (just look at St.Andrews community station), and more importantly, it acts as ‘free’ advertising all across the country and world for people with satellite. Companies like FatKat and documentary producers can display their wares, which opens up the possibility of export, as well as profit sharing.

    That’s a ‘small business model’ that provides a whole revenue stream potential for THOUSANDS. And it can be done right away for minimal cost. It creates numerous products for export, which is exactly what is needed. That, of course, is just one idea. The other benefit is that it offers a vehicle to ‘sell’the province to investors. Quite simply, people doing a little bit of research must look now at NB and say “Why in gods name would we want to invest in that shithole?” It’s not pleasant, but its reality.

  6. Anonymous says:

    Sorry, that should be ‘southern New Brunswick’. And there is the point that business investment isn’t a statistical game, just because you invest in more areas doesn’t mean it ‘balances out’, especially when the same people are making decisions. You can have a hundred foreign companies, and if they all fail or move, you are REALLY out of luck.

  7. Cooker Boy says:

    You obviously have never worked in sales, because the funnel concept has worked for decades. That being said, I would generaly agree that BNB does a poor job of supporting small business due to 2 reasons. One, BNB is concentrated on creating a huge amount of jobs becasue it makes their bosses look better. Secondly, I would rather see BNB take funds that are used to imporve small business marketing. I think marketing, or lack there of, is the biggest issue facing small businesses. Marketing cost a lot of money but is essential to grow your sales which in return will create jobs.

    Investment for marketing would enable small businesses to hire the expertise they need to develop campaigns and pay for getting their message out.

    You can invent the worlds greatest mouse trap, but if you don’t have the means to tell people about it you will fail. In today’s worl of “big box” business, the small guy needs to protrait an image(website, collateral, trade shows, PR) that enables him to compete.

  8. Anonymous says:

    The funnel concept hasn’t even been AROUND for decades. Like most marketing ‘concepts’ it is so varied that any argument that is said to ‘work’ can be called it.

    However, to play devils advocate (and to toot my own horn I’ve done sales for almost two decades and had a series of marketing plans which were used as study guides for marketing at UNB) you can do all the marketing you want, if no mousetrap exists, then you are fresh out of luck.

    With the internet it is quite easy to make products available internationally. When you’ve got a province where over half the people can’t even read competently, thats hardly the problem.

    To use the oft repeated example, the inshore scallop fishery doesn’t need more marketing, it needs to OPERATE. It can’t operate without investment to get it going.

    Take another example, Paderno. For years it was hard to even FIND parderno products. However, they touted quality and got some incentives to make a quality product.

    Take a look at another example, Monctons own Pumphouse. Beer is an international seller, yet this company can’t get squat from the government. In fact, the government gives millions to a giant competitor which may very well put them out of business.

    I would suggest that every single business is different. Whenever some person walks through a door, the question from the government should be ‘what can we do to help?’ Instead, they get lectures on what some bureaucrat who has never spent a day in business thinks they should be doing.

    Businesses dont succeeed because of adherence to any textbook teaching. As the above poster says, the whole thing is designed for employment. Whereas the banks in Canada are almost as bad and want massive growth at the outset.

    I read an interesting story about Ben and Jerrys and how, initially, they weren’t making enough to get through the winters and thought they’d go broke. Their banker told them they should stop repaying their loans while they weren’t making money. They hadn’t even thought that was possible.

    This is a huge issue that a blog can’t deal with at once, every business is different with different needs.

    The question for those talking about marketing, how about some specifics? What exactly is to be marketed and where? Keep in mind that we also live in a retail oligopoly, it is EXTREMELY difficult to get a product into a retail giants’ mix. In many cases you simply have to sign over your company to them.

    What was interesting was reading about NB sending metal processors from northern NB to Alberta on a trade junket, yet I could find almost no metal processor s in the north.

    The problem seems to be the same as is mentioned in every history book of the depression: New Brunswick really has nothing that other places NEED. There always seems to be this assumption that everybody in the world NEEDS a better mousetrap, when in reality, most people don’t have a rodent problem.

  9. David Campbell says:

    Cooker Boy says:

    “Secondly, I would rather see BNB take funds that are used to imporve small business marketing. I think marketing, or lack there of, is the biggest issue facing small businesses. Marketing cost a lot of money but is essential to grow your sales which in return will create jobs.”

    Market to whom? 95% of small businesses service their local markets – mostly competitive local markets. If the government trained them on how to be better marketers – they would just intensify local competition.

    I think we need to be crystal clear when we throw around the term ‘small business’ in the economic development sense. The government supporting (directly or indirectly) small business startups to compete against their already established neighbours is a real stretch if you are calling it economic development. You give me a small business that has used its local market development to leverage exports and growth outside NB, then that’s economic development. And I am willing to fight all day on this because I get tired of hearing all this stuff about the ‘backbone of the economy’. Small businesses are very important – but by in large they play a support role in an economy – not a direct role. What’s more important to the Miramichi economy, 100 small businesses (gas stations, hair dressers, janitorial firms, consultants, etc.) or one large pulp mill? If the 100 small businesses close, it will do nothing to the pulp mill. However, if the pulp mill closes, so will most of those 100 small businesses.

    We need to have a better understanding of how economies work before we can serve up ideas for economic development.

    Now, having said all that, if BNB can selectively work with the few dozen highly successful small businesses in New Brunswick to help them grow their external markets, hallelujah. But this blanket ‘support small business’ schtick doesn’t cut the mustard with me.

    Guess what happened when our esteemed Premier cut small business taxes to support the growth of the small business sector?

    The number of small businesses dropped by 7%.

    It’s the pulp mill effect mentioned above.

    $2 billion more in government spending today and a 7% decline in small businesses.

    You do the math.

  10. Anonymous says:

    There’s small business then there’s small business. I don’t think cooker is talking about helping out the local pizzeria to advertise.

    But anybody can export, but like I said, the government shouldn’t be dictating how its done. A guy in Newfoundland just hired two more people for his company. Before it was just him, he custom built guitars from driftwood. Now theres three and I had to look for that info, he said he got his customers from music related websites.

    No, that’s not going to turn everything around, but multiply that by the number of people. For his business the best thing the feds could do is give him a break on shipping, and since Purolater is a crown corporation, that should be possible.

    These things can’t all be resolved by government though. ‘Local markets’ can be anywhere from down the street to down the coast. Keep in mind,there are lots of people with money in New Brunswick, enhancing opportunities for northern based businesses to the south is something not even addressed.

    As I’ve posted before, the vast majority of Vermont, New Hampshire, and Maine’s economies are servicing within the state. Vermont has one quarter of the exports of New Brunswick but one third the unemployment and spends twice as much per student on education.

    If you control your local economy a little better then you can do wonders. How come ‘Northumberland’ isn’t an export name for Co op products? Maybe you’ve heard of a company called Nestle from Switzerland, or Chapmans, a family business from Ontario. There is no reason those product lines cant be exported. If retailers won’t touch them because they aren’t a private company then create a phantom corporation.

    Likewise, my favourite example is Mrs.Dunsters because that product is heads and tail above the competition. I’ve been all across North America to donut shops and I haven’t found anything that comes close. Yet as soon as you hit the Quebec border its no longer available.

    Meanwhile other coops are doing the reverse. The huge Co op in Fredericton refuses to carry handmade local clothing, that’s a slap in the face to the history of the coop movement. And its not like its because of cost, they only carry high end stuff because they can’t compete with WalMart. Meanwhile, you have a dozen or more people at farmers markets and in malls trying to sell enough to get by.

    That’s also marketing. If Irving were actually run like Ben and Jerrys then people would be wearing Irving logos and talking them up everywhere they go. The same with McCains. In the states the people clamour for Starbucks, they pay well, have benefits, and donate most of their profits as well as buy extensively from the fair trade coffee growers.

    In Canada, well, we know that story. But its hard to make a new company grow when you have such a tiny base, which is why export companies are quite rightly the top of the list. Yet apart from Irving and McCain, and Sabian, who else is there? And don’t even say Ganong, because I swear I never even see those things on shelves anywhere except at christmas.

    But I don’t agree with that analysis about growth. There are lots of towns and villages which have no large central manufacturing plant that have been chugging along quite well. I’d argue that all day, because usually such companies create artificial growth. Its not real growth simply because it is not sustainable. Anybody that thinks that mill is going to be there in another decade is crazy, certainly not with the level of workers.

    That doesn’t mean anything about the town. It could well become the ‘retirement centre’ it is attempting to be, but of course can’t because of the unbearable stench.

    Many of these companies actually produce the opposite of economic development by stripping areas of their resources too quickly. Instead of one giant producer, you can have a hundred small ones. There is no guarantee of which is better, it depends on the specifics. That mill in Miramichi does a lot of damage, ecotourism is out, as are any future potential industries that could have relied on some undeveloped industry. A multimillion dollar industry in southern ontario now is organic mushrooms, something NB forests are great at producing, but not when the forest is cut down.

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