Also in this report:

– Fire sparked G&T business boom p.29

– Grand & Toy puts stock in convenience p.34

– Grand & Toy advertising historically low key: First TV commercials in the 1990s p.35

– G&T Connects with new venture p.38

– Half of chain now run by owner-operators p.38

When James Grand was establishing his business in 1882, he went door to door in downtown Toronto, seeking orders for stationery and delivering goods to his customers by wagon. Today, Grand & Toy telemarketers prospect for new clients using computerized databases, and guarantee cross-Canada delivery within 24 hours.

Over the course of its 115-year history, Grand & Toy has learned from and adapted to changing times, outperforming the competition to remain Canada’s leader in office products.

Today, on the eve of a new millennium, and backed by aggressive new owners – u.s.-based Boise Cascade – Grand & Toy has launched one of the most ambitious expansion drives in the company’s history.

‘On the commercial side, historically we have gone after middle-sized accounts,’ notes Alan Berdowski, g&t’s director of marketing and merchandising. ‘In the last few years, we’ve launched a program to target the larger Fortune 500 companies.’

Further, says Berdowski, the company is looking to raise the bar in its retail business by introducing ‘numerous innovations’ to serve smaller customers.

Grand & Toy began in 1882 with the ambitions of James Grand, a first-generation Canadian whose father had emigrated from the u.k. Working for a publishing firm in downtown Toronto, the young Grand saw the need for paper products in the world of commerce springing up around him, and he began taking orders for stationery.

With these orders as capital, he bought paper on credit from wholesalers and hired young boys to deliver the goods by wagon. Many of the youngsters later moved through the ranks to become Grand & Toy salesmen.

In classic entrepreneurial style, Grand started the business at his mother’s kitchen table, but demand for his personalized service grew quickly and in 1883, joined by brother-in-law and partner Samuel Toy, he launched the first Grand & Toy retail outlet in downtown Toronto.

In 1885, the firm moved to a bigger location on nearby Wellington Street, where a staff of 12 was employed, including an entry clerk and shipper.

The year 1904 could have marked the end of the firm when a fire hit downtown Toronto, destroying numerous properties including those owned by wholesale stationers. But lady luck smiled on Grand & Toy and its building was spared (see sidebar, opposite).

After the fire, companies required complete stocks of office supplies, and Grand & Toy – now the only supplier around – was besieged with orders. When Toy passed away two years later, Grand took control of the company, which was run as a family enterprise for the next 84 years.

A period of stabilization lasted through the First World War, with Grand & Toy becoming a complete outfitter for Canadian offices. While pen nibs and ink wells still rang up brisk sales, presswood filing cabinets and roll-top desks were also becoming popular.

In 1912, an office furniture department was launched, receiving exposure in The Trade Mark, an advertising adjunct to the Grand & Toy catalogue. The opening of printing facilities and a bindery in 1916 meant the small corner stationer could supply bookbinding, printing, business furniture and office supplies under one roof.

Generally, Canadians enjoyed prosperity in the 1920s and Grand & Toy was no exception. Under the leadership of Percy Grand, who became president when his father James died in 1922, the firm began landing contracts to furnish some of the office towers being built in Toronto’s burgeoning downtown financial district. Meanwhile, the first branch store was opened on Bay Street in 1926, with another the following year on Yonge Street.

Breaking ground of a different sort, Percy Grand invented the round-edged pencil – the prototype of the modern-day pencil.

During the 1930s, business in the firm’s two branch stores was slow, and greeting cards were added to increase store traffic. Once again putting on his inventor’s hat, Percy Grand invented Eyesaving green-tinted paper after his son complained that the glare from white paper strained his eyes. To produce the green paper, the senior Grand bathed white paper in green ink and flattened it with his wife’s iron. Eyesaving paper is still widely accepted in North America as the standard in ledger sheets and accounting forms.

As the decade ended, Grand & Toy purchased a printing plant.

When sixteen-year-old Harold Parrington joined Grand & Toy’s shipping department in 1948, it was probably the largest retail commercial stationery organization in Canada, with about 275 employees working in three locations. Percy Grand was still president and his business philosophy rubbed off on Parrington.

‘[Percy Grand] believed there was no such thing as a dumb question,’ recalls the veteran employee. ‘Ask a question and he’d do his best to answer. That was his approach, and it became mine.’

Now Grand & Toy’s senior customer service manager, Parrington credits the firm for holding on to its employees and promoting from within. Sales Account Manager Paul Jones, a 37-year g&t veteran concurs: ‘Our sales department is made up of young people with a lot of seniority and that’s a fairly strong statement. We do not have many people moving in and out.’

Moving is precisely what happened in 1955 when Grand & Toy relocated its head office from Wellington Street to the Toronto suburb of Don Mills. The company needed extra space and wanted to locate its warehouse, offices and printing plant in one location. Parrington remembers a different Don Mills then.

‘ibm was the only building on Don Mills Road other than dairy farms,’ he recalls. ‘There were no buses and you had to walk from Eglinton [Avenue].’

In 1954, Percy Grand died, leaving son James Grand to become president. One year later, the company opened a store in Hamilton, Ont., its first outside Toronto. The Lawrence Plaza store also opened in 1955, bringing the total number of retail stores to three.

With one-stop shopping becoming a Canadian institution, Grand & Toy hoped to capitalize on the trend by opening stores in malls and expanding its product line to include more gift merchandise.

The early 1960s heralded a new stage in Grand & Toy’s development, one which lasted three decades. Competitors were acquired and branches opened in Ottawa and Kingston, Ont. The company ventured westward in 1966 when it purchased Keith Stationers in Calgary. In 1967, the firm opened a Vancouver branch, followed by another in Edmonton in 1968. Grand & Toy completed its western expansion in 1982 by opening a branch in Saskatoon.

After 75 years of steady – if somewhat unspectacular – growth in southern Ontario, Grand & Toy was quickly becoming a nation-wide office products supplier.

‘People in southern Ontario assume we’ve always been big across Canada,’ says Andrew Smith, advertising services manager. ‘But we didn’t have a location out west until 1963. The speed of growth near the end (of the Grand family’s ownership of the firm) was huge compared to how it began.’

By 1982 – the company’s centennial year – 1,400 Grand & Toy employees worked out of 35 locations, including branches in Vancouver, Edmonton, Calgary, Saskatoon, Ottawa, Kingston, Hamilton and St. Catharines. As demand for the Grand & Toy line increased, many branches opened new offices and warehouses, or expanded the facilities of those already there.

In the early 1990s, Grand & Toy’s world was turned upside down when u.s.-based office supplies superstores began arriving in Canada, offering wide product selection and low prices. In 1990, Toronto-based Cara Operations bought Grand & Toy from the Grand family.

Alan Berdowski, who joined the firm with Cara, remembers the challenges: ‘Grand & Toy was the dominant office products retailer in the 3,500-sq.-ft. [range] and along came this category killer with 16,000- to 20,000-plus sq. ft. stores, with low prices.

‘We went into a defensive mode based on price and introduced superstores of our own.’

But, adds Berdowski, ‘after about a year we realized that was the wrong game to play.’

g&t opened two such stores, both in Toronto. The firm’s Dufferin Street outlet is still in operation, but the East York Town Centre store was closed, partly due to the level of theft, a g&t executive reveals.

Instead, says Berdowski, Grand & Toy worked hard to build upon its reputation as ‘a better service package wrapped up in convenience.’

Stores were redesigned with more checkouts and better signage; the product mix was expanded to include more brand name items and single items at bulk prices; computer parts and software were added to the shelves; traffic builders such as photocopiers for in-store use were introduced; and promotional activities – such as providing customers with company-identified T-shirts, hats and mugs – were increased.

‘We’ve also put more emphasis on staff training and development in the last three years,’ states Jeff Holmes, general manager of retail sales and service. ‘It’s a positive culture here and, generally speaking, most people stay quite some time. Consequently, our sales associates have better product knowledge than the competition.’

He is also bullish on an owner-operator program Grand & Toy has introduced (see sidebar p. 38).

The innovations that have occurred over the last year have been at the initiative of new owner Boise Cascade, the office supplies dealer that purchased Grand & Toy from Cara in February, 1996.

As part of the re-tooling of the company, several stores were closed. ‘Some were closed because they were unprofitable,’ says Holmes. ‘In other cases, they were in markets or locations that we didn’t want to be in anymore. An example would be stores that historically, as part of Toronto, were viable in the ’60s and the ’70s, but as the world sort of moved underground to the subway tunnels, we had more success with subway-level stores.’

Layoffs were also part of re-structuring in the 1990s, but in the last few years more people have been hired in the telemarketing and office information departments. The turmoil involved in restructuring was the price of being profitable, Andrew Smith says.

‘At the risk of sounding corporate, you could probably say it was about time something was done to restructure and allow us to operate with lower expenses. The big box guys absolutely forced it.

‘You could try and price against them, but you wouldn’t make any money,’ says Smith. The alternative, he explains, was to ‘find a way to run your business that would cost you less. We’ve taken the latter approach and in the last two and a half years we’ve started to see a real upswing.’

Today, Grand & Toy’s 75 retail locations run right across Canada, with seven regional distribution centres, including ones in Moncton, n.b. and Montreal.

A range of 3,000 products are offered and about 2,000 people work for the firm. Products ordered by phone or computer are delivered from the centres to the appropriate stores.

Meanwhile, Grand & Toy has left its main Canadian competitor – Calgary-based Willson Stationers – in the dust: It acquired Willson’s 26 Ontario stores in 1992 and bought four more in Victoria the next year.

Willson now operates 49 stores in the four western provinces.

Over the last decade, Grand & Toy’s commercial business has increased to about two-thirds of the company total. Cara, and now Boise Cascade, have poured millions of dollars into improving Grand & Toy’s business-to-business marketing. Among the improvements: a guaranteed next-day delivery service; the relaunch of an interior design service; the introduction of financial services; a fully integrated national information ordering system; and computer marketing and ordering systems.

Perhaps most significantly, in January, the company launched a direct sales arm called G&T Connect.

Hoping to capitalize on what Bryan Bedard, Grand & Toy’s general manager of sales and service, calls the ‘wave of the future,’ the company has put a lot of money and resources into becoming a single-source supplier to national companies.

‘With Grand & Toy, you’re buying from a national company and serviced by a local company – the best of both worlds,’ he says. ‘Moreover, our integrated ordering systems and computerized sales provide the controls and consistency national companies look for.’

As for the future, Andrew Smith finds it so bright, he may have to wear shades. ‘When you get taken over by a big American company, you get nervous, typically.

‘The truth is, Boise Cascade has shown its belief in us by committing to projects like store renovations and investments in computers.’

Smith says, ‘The company wants to dominate and be an international office supply dealer.

‘It’s exciting to be part of that.’