Article as it appeared in the KW
Record July 14th., 2004
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XL Tool president Gord Jokic stands beside a computer numerical control
mill used in the machining of steel blocks to make tools and dies. |
'On top of technology'
Upgrades fuel revenue growth at Kitchener firm
PHILIP JALSEVAC
DAVID BEBEE, RECORD STAFF
If sales are any indication, Gord Jokic must
be doing something right.
When he started XL Tool Inc. in 1992, the
Kitchener firm was a two-person tool and die business. Annual revenues
were a modest $49,000.
That figure has risen to nearly $2.7 million
for the fiscal year ending last September. Just five years earlier, in
1998, annual revenues were $522,000.
That achievement landed the business in the
146th spot when Toronto-based Profit magazine last month published its
annual list of Canada's fastest growing companies.
Jokic (pronounced yo-kich) says revenues for
the 2003-2004 fiscal year should be slightly higher than last year.
"In our business, it can fluctuate quite a
bit. But we will probably exceed what we did last year, " he says.
About 90 per cent of XL Tool's work involves
making tooling for the automotive parts industry. Its specialty is
designing and building metal stamping dies, which its customers use in
their own production.
XL Tool has a broad customer base in Waterloo
Region and nearby communities such as Woodstock, Guelph, Tillsonburg,
Toronto and Mississauga.
"It's a pretty good mix," says Jokic, the
company president.
"We have about 100 or so customers. There's probably six or seven where
the bulk of our work comes from, but it's never more than 20 per cent for
any one customer."
Jokic, 41, likes the diversity of the client
base. If business from one slows, there's a good chance it will be made up
by sales to another, which enhances the company's financial stability and
cash flow, he says.
EX-TRUCK DRIVER
Jokic, who was born in Kitchener and grew up near Ayr, wasn't quite
sure what path to follow after graduating from Paris District High School.
Initially, he went west and worked as a truck
driver in the oil exploration industry for about two years.
He then came back to Ontario and studied
aircraft maintenance for one year at Centennial College in Toronto.
A more enduring career shift came when he
landed a job as a press operator at Budd Canada in Kitchener. Later he
apprenticed to become a tool and die maker with the company, where he was
employed from 1984 to 1996.
Before leaving Budd, Jokic launched XL,
opening a 1,500- square-foot shop on Riverbend Drive in Kitchener. He and
his partner, Mike Radjenovic, ran it as a part-time operation.
In 1995, the two took a more significant
plunge as entrepreneurs, moving the company to a 7,000-square-foot
building that they purchased for about $200,000 at 25 Hollinger Cres. in
the Bridgeport area of Kitchener.
The purchase was made with the help of a bank
loan, with the building as collateral. The pair also invested $50,000 of
their personal savings in equipment and machinery.
"It was all used stuff that I bought at
auction sales and that type of thing," Jokic says.
"It was time to take a chance," he says,
recalling the fledgling venture. At Budd, he says, "basically, I was
bored and wasn't being challenged anymore and couldn't see myself working
the way I was for the rest of my life."
Jokic left Budd in 1996 to devote himself full time to XL Tool. And in
1997, he became the sole owner. buying out the shares of Radjenovic, who
has since retired.
"I slowly started hiring employees," Jokic says.
By 1998 the company had five employees. Today it has 27.
Initially, about half of the Hollinger Crescent building was leased to
commercial tenants, but XL Tool now occupies all the space.
Although he remains the majority shareholder, Jokic sold shares about two
years ago to XL's plant manager, Chris Hergott, and to engineering manager
Nick Cvrkalj.
Jokic acts as sales manager and says most of XL's business has come about
through building a good reputation, word of mouth and some cold calls.
Now, however, he's taking a more proactive approach to finding customers.
In the last year he has hired consultant Rick
St. Clair of Cambridge to "put together a bit of a marketing program for
us, which includes an upgraded website (www.xltool.com) and literature
that we're sending out."
Regarding his business, Jokic admits: "There's
lots of people around doing the same thing. We haven't reinvented
anything.
'PRETTY GOOD TEAM'
"But I think our advantage is that we try to stay on top of technology
and we have a good bunch of guys here. We've been fortunate enough to put
together a pretty good team."
As well, Jokic says some of the leading edge
technology and machinery XL uses may provide it greater diversity than
some other companies.
"There's a lot that we can do."
When asked what helps make his business tick,
Jokic says "there's no real magic formula here."
That being said, the company president gave
some examples of XL business practices that he says make sense.
For one thing, XL Tool sets an annual financial goal.
"We sit down every quarter and see where we're at and there's a list of
tasks before we reach the next quarter that are spelled out."
The company also makes a point of paying its suppliers within 30 days.
"Some suppliers offer a discount (of roughly two per cent) if you pay
early," Jokic says. And prompt payment "creates a loyal supplier base. If
they win, we win. We pay a little less and they get their money early."
The company also values employee input and tries to build a sense of
teamwork.
"We listen to what they have to say as far as their concerns and any
suggestions go," Jokic says. "You want everybody to feel like they're part
of the company."
As for profits, Jokic strives to reinvest a healthy amount back into the
company.
"The kind of business we run here requires quite a bit of capital
expenditures. The equipment is expensive. If you don't put money back into
it, you're going to be slipping behind."
pjalsevac@therecord.com
Q & A
We asked Gord Jokic:
Q. In retrospect, how do you feel about making the transition from an
employee to an entrepreneur?
A. "There were days I regretted being in business. Running a business
isn't always easy. Things don't always go as they should. . . . It took me
about seven years before I was making the money that I was making at Budd
before I left. On the upside, things are starting to pay off financially.
Everything seems to be in place now and things are running pretty
smoothly."
...end of article (30)
