Manufacturing Company in China
In an age of declining manufacturing in North America, one Montreal company is bringing its production home. Aquaovo Experience Inc. ... “People hear we went to China and figure it was because of labour costs. That was a ...
Manufacturing Company in China
In an age of declining manufacturing in North America, one Montreal company is bringing its production home. Aquaovo Experience Inc., run by a brother-and-sister team, makes stylish, high-end water filtration systems.
The company, which was founded five years ago, at first tried manufacturing in Montreal. “But at the time we started we couldn’t find a manufacturer who could give us the right quality of ceramic and produce the quantities we needed,” said Noémie Desrochers, Aquaovo’s chief operating officer and co-founder. “People hear we went to China and figure it was because of labour costs. That was a secondary issue. We went there for their ceramic expertise.”
But quality control half a world away was difficult to manage and prices in China for staffing, materials and shipping inevitably rose. “It was a headache,” she said. “When you’re young and you have dreams, you think you will sell all over the world. It looks romantic and easy in a global economy. But what we underestimated was the time needed to support all those accounts.”
“Now we found someone who is able to do it here. Within the next year we hope to be completely Canada-based.” Noémie and brother Manuel Desrochers, co-founder and product designer, started the company with $40,000 from their father. In the first year of operation the family invested another $50,000.
The company intends to forge ahead with distribution in Canada, the United States, France and Hong Kong, Noémie said, but it will probably boost the price of its egg-shaped, 11-litre units, called Ovopur and Caviar, from about $800 “by a few hundred dollars.”
“We are going to raise our prices. The logic is that we’re not a high-end product in our pricing. Our pricing is between normal and high-end,” she says. The company is also introducing a more affordable smaller unit as well as a double glass-walled water-filtering bottle for about $50.
Aquaovo’s goal is to tap 30- to 50-year-old professionals looking for—and willing to pay for—good-tasting filtered water. Their ceramic jugs look like sculptures and have the environmental benefit of replacing bottled water and a portion of the 150,000 tonnes of plastic bottles that are discarded each year. The message is altruistic and environmentally friendly.
The company started slowly. It made $62,000 in sales in its first six months. In the next year, sales rose to $330,000 and Aquaovo broke into the U.S. market. The company became profitable in 2011, making about $30,000 profit on $700,000 in sales. Aquaovo is worth about $1.2-million, Noémie estimates.
The company was featured this year on the CBC investment cockfight Dragons’ Den. Noémie and Vincent Purino, vice-president of business development, made an impressive pitch and drew an offer from Boston Pizza chairman Jim Treliving—35% of Aquaovo plus a 3% royalty for $400,000. The Aquaovo principals and Treliving shook on it.
But a televised handshake isn’t the same as a written contract. The agreement did not hold, Noémie said. “After seven months of due diligence, he decided to go with other deals. We were asking for more money than most companies by far.”
Still, the dark cloud had a promising lining. “The upside is that we had great exposure,” Noémie said. Traffic to its website increased sixfold in the week after the March of 2012 show. “We were approached by Costco and Home Depot (in Canada) and kept all our equity.”
The green message with which Aquaovo made its initial impact remains its big selling point, said Manuel Desrochers, who has won design awards for the company at the SIDIM interior design show in Montreal and the Toronto Design Exchange.
The four-layer filter is contained in recyclable glass and is Canadian made. Tap water first passes through a powder made of copper alloy and ultra-pure zinc. The purpose is to reduce oxidation and neutralize chlorine, lead, mercury and other metals that may be in the water. The second—and thickest—layer is activated carbon, which absorbs pollutants such as mineral oils and pharmaceutical residues. The third layer contains bio-ceramic pellets that the company says remove additional organic residues and softens the water. The fourth level of the filter is quartz crystal, included as a conductor and “energy amplifier.”
The 11-litre unit comes with one filter cartridge. Filters must be changed three times a year – the company sends reservoir owners the filters – and it costs a family about $200 a year to keep up the filtering program. It sounds expensive, but Noémie Desrochers said families who use bottled water can spend $300 to $600 a year for it.
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The company, which was founded five years ago, at first tried manufacturing in Montreal. “But at the time we started we couldn’t find a manufacturer who could give us the right quality of ceramic and produce the quantities we needed,” said Noémie Desrochers, Aquaovo’s chief operating officer and co-founder. “People hear we went to China and figure it was because of labour costs. That was a secondary issue. We went there for their ceramic expertise.”
But quality control half a world away was difficult to manage and prices in China for staffing, materials and shipping inevitably rose. “It was a headache,” she said. “When you’re young and you have dreams, you think you will sell all over the world. It looks romantic and easy in a global economy. But what we underestimated was the time needed to support all those accounts.”
“Now we found someone who is able to do it here. Within the next year we hope to be completely Canada-based.” Noémie and brother Manuel Desrochers, co-founder and product designer, started the company with $40,000 from their father. In the first year of operation the family invested another $50,000.
The company intends to forge ahead with distribution in Canada, the United States, France and Hong Kong, Noémie said, but it will probably boost the price of its egg-shaped, 11-litre units, called Ovopur and Caviar, from about $800 “by a few hundred dollars.”
“We are going to raise our prices. The logic is that we’re not a high-end product in our pricing. Our pricing is between normal and high-end,” she says. The company is also introducing a more affordable smaller unit as well as a double glass-walled water-filtering bottle for about $50.
Aquaovo’s goal is to tap 30- to 50-year-old professionals looking for—and willing to pay for—good-tasting filtered water. Their ceramic jugs look like sculptures and have the environmental benefit of replacing bottled water and a portion of the 150,000 tonnes of plastic bottles that are discarded each year. The message is altruistic and environmentally friendly.
The company started slowly. It made $62,000 in sales in its first six months. In the next year, sales rose to $330,000 and Aquaovo broke into the U.S. market. The company became profitable in 2011, making about $30,000 profit on $700,000 in sales. Aquaovo is worth about $1.2-million, Noémie estimates.
The company was featured this year on the CBC investment cockfight Dragons’ Den. Noémie and Vincent Purino, vice-president of business development, made an impressive pitch and drew an offer from Boston Pizza chairman Jim Treliving—35% of Aquaovo plus a 3% royalty for $400,000. The Aquaovo principals and Treliving shook on it.
But a televised handshake isn’t the same as a written contract. The agreement did not hold, Noémie said. “After seven months of due diligence, he decided to go with other deals. We were asking for more money than most companies by far.”
Still, the dark cloud had a promising lining. “The upside is that we had great exposure,” Noémie said. Traffic to its website increased sixfold in the week after the March of 2012 show. “We were approached by Costco and Home Depot (in Canada) and kept all our equity.”
The green message with which Aquaovo made its initial impact remains its big selling point, said Manuel Desrochers, who has won design awards for the company at the SIDIM interior design show in Montreal and the Toronto Design Exchange.
The four-layer filter is contained in recyclable glass and is Canadian made. Tap water first passes through a powder made of copper alloy and ultra-pure zinc. The purpose is to reduce oxidation and neutralize chlorine, lead, mercury and other metals that may be in the water. The second—and thickest—layer is activated carbon, which absorbs pollutants such as mineral oils and pharmaceutical residues. The third layer contains bio-ceramic pellets that the company says remove additional organic residues and softens the water. The fourth level of the filter is quartz crystal, included as a conductor and “energy amplifier.”
The 11-litre unit comes with one filter cartridge. Filters must be changed three times a year – the company sends reservoir owners the filters – and it costs a family about $200 a year to keep up the filtering program. It sounds expensive, but Noémie Desrochers said families who use bottled water can spend $300 to $600 a year for it.
Read Commented Bookmarked 1.EDC weekly commentary2.Meet this year’s awards finalists3.Joe makes a fresh move south of the border4.An oil find offers hope for Ireland5.Meet our awards winners 1.The challenges of going abroad2.Shipping on the right terms3.Colombia for Canadians4.Breakfast with Jeff Rubin5.Your key to the Middle Kingdom 1.Global Opportunity Tool brought to you by HSBC2.Past Event: Breakfast Event with Jeff Rubin3.Waterloo’s eyes in the sky4.WEBINAR On-Demand | Doing Business in India, Part Three5.Past Event: International Markets :
RT @BroadReachComms: Canadian firms still prefer U.S. over China, Asia Pacific for investment: survey t.co/DuFehFlO via @CdnBusin ...
This link may allow you to access an HSBC Group website. Please read the terms and conditions of the linked website, which terms may differ from the terms and conditions governing use of the Business without Borders website.
This link may allow you to access another website. Please read the linked website's terms and conditions. Business without Borders and HSBC Bank Canada do not have control over the linked website and are not liable for your use of the other website.
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