MISSISSAUGA, Ont.—Canada’s small and medium-sized manufacturers—long accustomed to being thrashed by a volatile dollar, stacked border, plunging prices, polar vortexes and any number of other macro-economic vexes—may finally be able to take a long, full breath of fresh air.
And once they do that, they should head to the United States and buy a company.
At least that’s what Robert Hattin thinks. And don’t kid yourself—he may be on to something.
Hattin, a businessman, founder of automation integrator ProVantage Automation, chairman of the Canadian Manufacturers and Exporters (CME) and hard-talking, good-natured provocateur, made his case yesterday at the Manufacturing Canada Conference at the Mississauga Convention Centre.
The pitch goes something like this:
The U.S economy is the largest, most dynamic in the world.
This economy is our largest trading partner and, in the case of many companies, our sole customer.
Having experienced recent economic shock, this market has begun a process of retrenchment, compelling its captains of industry to return home and its industrial consumers to purchase products made within the market.
The call has been heeded. And with relative disregard to long-standing trade agreements, Canadian firms are now more often being shut out of certain industries in which they once enjoyed a market-leading position—defense and infrastructure, to name two.
However, Canada is looking at a resurgent manufacturing sector buoyed by low interest rates, a low-ish dollar and a beleaguered manufacturing base south of the border looking for relief.
So why not, instead of duke it out with other Canadian firms over limited geographical and sectoral turf, acquire an American company?
Underpinned by the relative strength of ongoing Canadian operations, you could then buy a shop in the U.S., be eligible for contracts under the bemoaned Buy American Act, and leverage the structural weakness of regional U.S. markets to expand your business.
Buy Americans, if you will.
A bold move not without risk.
But Hattin thinks it there is less risk than we may think.
“Business as usual is no longer an option, and we have to figure out other ways to continue to participate in the largest economy in the world,” Hattin said during his closing remarks at the Manufacturing Canada Conference.
“Lets Buy America. Lets invest in America. It’s time to turn risk into courage. But do you have the courage to be transformative?” he asked.
Good question, Mr. Hattin. But will manufacturers have an answer?