Rising oil prices, poor currency exchange, and a sagging US economy have contributed to a decline in the Canadian manufacturing industry.  More and more products have been outsourced abroad, which has further contributed to the sagging fortunes of manufacturing companies in Canada.  However, some companies have still been able to prosper in these tough economic times.

A local manufacturing and distribution company, Algreen Products, has developed a brand new rain barrel that has revitalized their Canadian plastics manufacturing business.  Algreen Products was in a process of downsizing the business when demand for their new rain barrel suddenly rejuvenated their manufacturing operation.  Demand for this new environmentally-friendly product has been staggering.  Plans have been made to increase manufacturing capacity due to the endless orders for the new rain barrel.

Algreen attributes the success of their rain barrel to two main factors:

  1. Identifying and targeting a growing niche: the North American green shift, and
  2. Taking advantage of the federal government’s Scientific Research and Experimental Development program (i.e. SR&ED funding) to finance their new product development.

Algreen’s strategy was to take advantage of SR&ED funding to finance new product development.  With revenue shrinking, most companies aren’t able to invest in R&D.  However, R&D is the lifeline of any company.   Cutbacks in R&D cause product lines to stagnate, which in turn diminishes the future competitiveness of the company.  Companies that do not continuously invest in R&D tend not to survive.  And this is why during tough economic times, it is especially import to find alternative means to finance new product development.  Unfortunately, very few manufacturing companies are aware of the SR&ED program, and thus, are not able to take advantage of the extra cash flow that this program offers.

In the meantime, orders for the new rain barrel keep on coming in.  Trucks keep on rolling into the loading docks, and Algreen is hard pressed to fill them.  Algreen seems to have hit a market niche that has struck a chord with consumers.  The new rain barrel not only helps customers to conserve water and save money, but it also combines the timeless aesthetic elegance of ceramics with the enduring longevity of modern plastics.   According to company spokesperson, Walat Yasin, “City-issued rain barrels are ugly.  The concept behind this new product has been to develop a rain barrel that homeowners could proudly display, like a piece of furniture.”