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KYLE SCOTT/The Globe and Mail

"If you’re a brick-and-mortar retailer that isn’t good at digital, you’re dying. And the pure e-commerce guys are realizing consumers trust brands more if there’s a brick-and-mortar element to the business. Amazon is opening stores. So are Warby Parker and Everlane. We’re a furniture maker that got into retail, and now we’ve realized we have to be in digital.

EQ3- grew out of Palliser Furniture, which has been in business for about 80 years in Winnipeg. When Peter Tielmann launched EQ3—the name stands for emotional quotient in a three-dimensional space—as a wholesale concept around 2001, it was very well received by retailers. More of them caught on, and from 2005 to 2009, we were in kind of a joint corporate franchise model, not dissimilar to the model La-Z-Boy used to have, while also supplying furniture as a wholesaler.

Then came the Great Recession. We had to shut down some stores, and we were also very exposed to other retailers. We restructured and decided we were just going to own corporate stores. There are not too many companies out there that design, manufacture and sell their own products, so we had a lot to learn about how to be a great retailer. It was only really in 2018 where we thought we’d got the retail side to where we need to be.

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E-commerce was one piece we didn’t have. Oh my gosh, the customer experience on our website was so terrible—it used to crash all the time, and it was slow. Then our CEO became good friends with Josh Simair, the founder and former CEO of Skip the Dishes, another company based in Winnipeg. At the end of 2018, Josh ended up sending us on a whole different orientation on technology, and he brought some of the guys who used to work with him at Skip into EQ3. We’re still not as good in digital as e-commerce startups are, but we’re closing that gap quick. We were running off our own internal servers, and the guys from Skip told us we didn’t even have the right bandwidth to do what we were trying to do. So they took us to the cloud, and our website is blazing fast. We’ve got to enhance the front end, for sure, but we’ve got a Ferrari engine.

Now, we’re making a play in the United States. We had some stores there before the recession, but we never paid the American market the attention it deserved. Now, we feel we’re good enough to go big in the U.S. We’re opening a flagship location in Manhattan. We’re opening in Chicago, at the third-most valuable mall in the U.S. We’ve figured out our supply chain, and we’re figuring out the final mile for delivery. Right now, I’m looking to open a distribution centre in Chicago. We’re also looking in New York and San Francisco. We want to be represented all over the U.S., to make sure people can experience our furniture in a showroom. We definitely plan more store openings in 2020-21.

Consumer tastes are changing, so even if the overall furniture market isn’t growing that much, the modern furniture market is. We want to be there to take advantage of the changing conditions, but we can only do it if we get everything lined up. We’ve got to go after it now."

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