Coman Arctic Ltd.


Iqaluit, Northwest Territories

For more than twenty years, Fred Coman has been providing office and warehouse leasing, cartage, moving, and janitorial services in Iqaluit and the Baffin Island region. He recently opened an art gallery called Coman Arctic Galleries Ltd., which serves tourists and the local community.
Fred is sole owner of his companies, but his brother Mickey handles the accounting, some of the art purchases, and hiring the janitorial staff. Fred built his business up slowly without government assistance. He attributes his success to making business decisions carefully and thoughtfully while taking advantage of opportunities, once he feels comfortable with them. Fred has established a solid reputation in the community for friendly, reliable service at a reasonable price. He is active in local politics and a strong supporter of local community activities. The details of his early years are set out in the following section.

History

Fred lives with his wife and two children in Iqaluit. He received a grade 8 education in Kirkland Lake, a small town in northern Ontario, before moving to Iqaluit in 1961. After getting out of the airforce, he was offered a job with a company that handled refueling of European flights. In 1963, he was hired by the Department of Indian Affairs and Northern Development as a foreman for road maintenance and water, garbage, and sewage service.

 

He recalls, "I convinced them that I could do it, so they agreed to try me for one year. They started me at $1.81 an hour and I worked my way up to $2.10 an hour. At the end of the year they put me on full salary at $4.25 an hour."
Fred continued in that position for eight years, including five years after the work was taken over by a private contractor. In 1968, Fred bought an old movie theatre and ran it in the evenings after work. He went on his own in February 1970. He recalls, "I ran the theatre and started a janitorial service; then I brought three trucks up from the south. Next I bought out the existing moving company for about $2,500. We handle the whole Baffin region and some of the central Arctic."
With the advent of television, the movie theatre had to be shut down. It closed in the mid-1970s when revenues could not cover expenses. Coman Arctic Ltd. is federally incorporated. The main focus of the business for the following years remained the janitorial and local cartage services and the moving business.
In 1985, Fred applied for membership with United Van Lines. He recalls the stringent selection process, "We had to be financially sound, as shown in three years of financial statements. We had to meet facility requirements and we had to have $5 million in insurance because they donít want just anybody representing them." In 1989, in terms of volume his company ranked 40th among 290 movers across Canada. The community of Iqaluit, which now has a population of 3,000, has changed considerably over the past thirty years. Fred recalls, "There were few private businesses here except

Hudson Bay warehouses.

the little local hotel, a taxi company, a barber shop, the local co-opís carving shop, and a Bay store. Today it has grown, with the territorial government as the biggest industry and all the economic spin-offs associated with servicing the government. We need more stores to supply goods to the families of the personnel that are in government and those who are hired to look after the government employees. Itís a big chain of spin-off opportunities."
One thing that Fred is struck by is the fact that all the clerks he worked in Finance and Public Works during the mid-1960s, are either deputy ministers in Yellowknife now or directors of their branches. He wonders, "If I had stayed with the government, would I have gone that far? I donít know, but I chose my road."
Living in the North can be eventful in the winter. Fred remembers an eight-day storm that left him snowed in at home with his wife and children. "I told my wife that if it got to 35 degrees below, I would smash the washroom window out and take the kids across the road where there was an old coal stove. We were scared that we wouldnít have electricity. Two times during that week, it went down to 40 then 45 degrees below. We dressed everybody, but ended up waiting to see what would happen. Then the third time the temperature dropped, we got everybody dressed because the power was off. I took a chair and as I raised it to smash the window; the lights came back on and we stayed."


Operations

Coman Arctic and Coman Arctic Galleries carry on business in a new 10,000-square-foot building, directly across from the airport. Valued at $1.1 million, the building required the first bank financing that Fred has ever taken in all his years of business. The loan amounted to 30% of the total project cost. The art gallery occupies approximately 900 square feet, with the balance taken by Fredís office, short-term storage space, and storage of packing materials.
Payroll, accounting, and all the paperwork associated with various businesses are handles by a secretary, by the office manager, and by Fredís brother Mickey. They work out of another office building that Fred owns. The land is leased, since some land in the Northwest Territories is no longer available for purchase until land claims are settled.
Fred notes, "The office staff handle the majority of paperwork there. Anything that has to signed or looked after, they send to me at this office every morning. I do it and send it back. We meet everyday and it is like a family business because Mickey has worked with me for so many years."
Revenues are split evenly between janitorial, moving, and cartage services.
Regulation of the majority of Fredís businesses is limited. Generally, all he needs is a business license. However, there is more extensive regulation regarding the moving of dangerous goods. Fred explains, "We have to abide by all federal regulations. Three employees and I have taken courses on special packing requirements. We pack and ship dangerous goods for all the local companies."
Regular cartage customers include the Northern Store, Arctic Ventures, and some hotels, since they regularly have goods for pickup from the airport. Fred notes, "We make deliveries every afternoon. The rest of the time is filled with packing and moving. One complements the other. We do office moving from one building to another, moving new people in or moving people who are leaving the area."
Fred has nine trucks, five which are used for the moving and cartage business.

 

"We use three trucks every day with two spare trucks to handle any overload. I have step-in vans with fourteen-foot platforms that are covered in and with roll-down doors at the back. I also have a couple of older ones that I keep and several window vans to pick up staff or for transportation."
Packing material must be ordered annually and is brought in by boat. "We order material based on the previous two years. We have to rely on our experience because there is no one to ask about how many teachers are going to leave or how many government staff are going to quit or be transferred in the year."
United Van Lines sets the schedule of territorial rates across the west, central, and eastern regions. The prices are set so that Fred earns a reasonable rate of return. He explains his personal pricing philosophy: "My attitude is, what difference is $10,000 going to mean to me? Will I live any better? I have a roof over my head, a vehicle to drive, my kids go to school, and I take a holiday when I want. I could increase my prices another 30% and my customers would squawk for a month, but then they would pay it. I wonít do that because as long as Iím personally satisfied with what I am earning, I can live, pay my bills, and show a profit, then I am happy. If you get greedy it can work against you, so itís not worth it."
The steadiest source of revenue is the janitorial services. "I have had a verbal contract with Frobisher Developments since 1970. I have the contract as long as I do the work. Our projects include apartments, the shopping mall, Bell Canada, and the RCMP."
Fred never had a master plan of the types of businesses that he wanted to operate. In his words, "I just saw opportunities and took advantage of them." Another venture Fred is involved in is leasing buildings that he has built. He currently owns ten buildings in Iqaluit and he leases them to individuals or government agencies, usually as office space.
Finally, Fred recently opened an art gallery in his new office building. It represents a personal interest he has pursued for many years.
"I always liked art and Iíve always dabbled in it. I bought and sold pieces through friends and people who came into the office. The art gallery is just starting and I think it is going to be successful. The art is the most expensive business I am in, particularly because the prices are high. If I make a mistake and I

buy a piece that I canít sell then, Iíve just inherited a piece for life.
My brother and I buy inventory based on many years of experience. I supply soapstone to a number of local artists - which I have no problem getting, contrary to what the media might say. I have a couple of local artists that I look after by paying their rent, phone, and power bills and buying a new machine when they need it. They come and collect money every day and I keep a bankbook of their account. When they carve a piece, that pays down their account. Iíve been doing that for fifteen years. I think Iíve just about broken even with all the pieces Iíve sold recently. I lost quite a bit of money in a camp that we tried to get going where a couple of artists wanted to camp out on the land. It just didnít pan out. They spent money but didnít pay back enough in carving, so now they stay in town and work.
Fred has watched the influence modern tools have had on traditional carving techniques.
"Some people label traditional carving techniques as when the artist uses only a hatchet and file. Today artists use electric tools and a saw but I think that theyíre still creating a traditional piece. The new tools save time. An experienced carver can shape a block of soapstone so the four legs of a polar bear are square and save 80% of the time it took to chip with just a hatchet and a file. It still comes out in the same form and saves him a weekís work. All the final work is done with his little hammer and his file."
I donít think that the final product is influenced by the use of these tools. In fact, with the finer tools available today it should be better quality. However, I donít really see that change yet. The older guys used to make hands with fingers and fingernails but now the figure has gloves."
In 1989, Fred was asked to supply 180 sculptures as prizes for the Ladies Pro-Golfers Associationís DuMaurier Golf Classic in the United States. It took three months to fill the order, and the customers were pleased with them because no two sculptures were the same. Now they buy 36 sculptures a year from Fred for various tournaments. Other customers have included Peter Pocklington, owner of the Edmonton Oilers, Glen Sather, their coach, and the coach of the Winnipeg Jets, Bob Murdock.


Staff

There are a total of twenty-three people working for Coman Arctic Ltd. As mentioned earlier, there are three office staff; in addition, seven employees handle cartage and seven others work for the moving business. Three couples are employed for the janitorial service.
Fredís brother Mickey has been with him for a number of years, handling accounting and assisting in operations. Fred notes, "His wife has arthritis so they decided to move south several years ago. Now he works seven months a year for me and he has five months a year off. He comes up at the end of each month to handle the books. We try not to do anything without letting the other one know about it. He looks after the business when I take holidays." Fredís office manager has been with him for three years. She has signing authority for all cheques.
Fred does not dwell on problems in business. "Problems here are the same as for any business down south. I donít think thereís any great big problem, other than what you want to create. I guess staff is about our biggest problem up here but Iíve been lucky over the years. I havenít had that many staff problems and I have guys that are still with me after nine years."

Fred attributes low staff turnover to the type of employee that he hires and the operation that he runs. He looks for employees who are reliable and honest and who can get along with other employees. "Staff stay, maybe because I treat them how I would like to be treated. Maybe thatís the secret. I try to make work enjoyable and fun. We joke a lot. I am not strict about coffee breaks and my guys have coffee all the time as long as the workís done at the end of the day. I pay competitive hourly wages and we give bonuses at Christmas. Most of the staff are Native except in the janitorial services. I always allow the guys to hunt caribou or seal or go fishing unless weíre really busy and then Iíll explain that fully to them. Some want to go together but thatís hard. I will ask them to rotate and take turns, when one comes back then another can go."
Minor discipline matters are handled by constant reminder, or Fred may have a discussion with an employee to determine the cause of the problem. Discipline may also be handled with staff participation. "I donít like disciplining my staff; instead I like to have a chat with the person. Maybe thereís a problem at home with their marriage or finances. I try and iron it out because weíre like a family, since weíre together every day.
I remember one young guy who had a bad temper. I called him and the other guys in and said, ĎOkay, itís up to you, do you want me to fire him?í They said, ĎNo, not really because we like him and he is a good worker but he has to learn to hold his temper.í Itís been a year and that session worked." Fred encourages his staff to stop by and discuss any concerns they have with their job anytime. He describes his management style, "Just being myself and using common sense. I donít consider myself the boss or manager."
Fred tried hiring local people for janitorial services but had a lot of problems. He explains:
"The staff work from midnight until 8:00 in the morning. It is not a popular time because most people want to be with their family and friends. I had no luck finding reliable staff. I had a special clause put into the contract that I would only hire local people for extra help. I was tired of working all day and then working all night when staff didnít show up."
Now I hire couples strictly from the south. We advertise in various cities in the south and then go and interview the married couples. They each earn $1,400 per month. They stay in a fully furnished apartment, so all they need is their clothes. I pay their holiday out once a year, and if they want to go out on excursion trip, I give them time off."