By rights, the president of Calgary-based Simo Corporation should be on top of the world.

After all, Queen Elizabeth II eased her royal posterior into one of his company’s custom-designed chairs.

George W. Bush leaned his elbows on a birds-eye maple boardroom table manufactured to order by the artisans of Simo Corp.

Many legislative officials and Alberta MLAs do their deep thinking in Simo- produced upholstered chairs. During office hours, Calgary Mayor Dave Bronconnier is surrounded by Simo’s classy furniture products.

David Lazarowych photo, Business Edge
Simo Corporation CEO Louis Kelemen Jr. isn’t content to sit back and watch the offshore competition – he’s getting set to join them to add a product line

Nevertheless, Louis Kelemen Jr. isn’t the type to rest on past laurels. As chief executive of a $10-$12 million family business, he’s identified a potential offshore threat to future prosperity and intends to take proactive steps to deflect it.

That’s why the effervescent Kelemen, who owns two-thirds of the office furniture manufacturing operation on 26th Street N.E., has booked a February visit to Asia.

The perceived threat? Chinese import furniture, produced at a fraction of Kelemen’s costs and sold to retailers at prices local manufacturers can’t match. The strategic response? If you can’t beat ’em, join ’em.

After attending a Young Presidents’ Organization round table in Hong Kong, Kelemen will tour Chinese manufacturing facilities in Shanghai. There, he hopes to close a deal allowing Simo Corp. to import a low-end line of wooden office furniture to complement its own high-quality office suites, credenzas, tables, sideboards and reception desks.

“The (Chinese) product I’m considering would complement what we already do – a basic wooden U-shape office suite that I would normally produce and sell to my Calgary dealer for $3,200,” Kelemen explained.

George W. Bush pondered the world’s big questions while sitting at a Simo maple boardroom table during the 2002 G8 Summit in K-Country.

“I can buy a similar suite from China and bring it in for a bit more than $1,200.”

Kelemen doesn’t see the strategy as an unconditional surrender. More of an intelligent compromise.

Like many of Calgary’s office furniture producers, Simo Corp. specializes in custom designed and crafted pieces – fine wood products the boss believes offshore competitors would be hard-pressed to duplicate.

“To get the same thing from China, a customer would have to wait eight to ten weeks to have the work done, plus four to six weeks shipping time,” Kelemen reasoned. “That’s probably the thing that will save us.”

So give Simo Corp. credit for a creative response to shifting market conditions. Instead of panicking because Canada’s trade deficit with China (now the country’s second-largest supplier of imported goods) has reached the $12- billion mark, Kelemen will attempt to turn the trend to Simo’s advantage.

He also concedes that imported Chinese knock-offs aren’t the only challenge facing the office furniture producers of North America. The industry is locked into one of the worst extended swoons in its history. Contributing factors include the dot.com crash and a flat global economy during recent years.

To make matters worse, so many North American technology companies have bit the dust since 2000 that surplus reception tables and work stations continue to flood the market.

“There’s a lot of high-quality used product out there,” Kelemen nodded.

In spite of recent challenges, however, Kelemen remains generally upbeat.

And why not? Simo Corp. now deals in 10 times the volumes recorded by the company as recently as the mid-1980s.

His father, Louis Sr., stepped down from the top job at Simo in the summer of 2002, after buying out former associates in the company (and a series of predecessors) about 15 years earlier.

With 105 employees and two facilities (the second plant specializes in upholstered products), Simo Corp. has risen to No. 2 among Calgary manufacturers. Industry sources say Smed International, with estimated annual sales of about $200 million, remains far out in front.

That said, Kelemen refused to brag or gloat.

“I’ve got to give our competitors credit,” he reflected. “We don’t stand out from the crowd in Calgary. Everybody here makes very good product.”

True enough. But Simo Corp. has demonstrated a knack for landing high-profile contracts.

When Enmax relocated, Simo furnished the new executive offices. Then, of course, there was the last royal visit.

And in 2002, there was the G8 Summit. Simo Corp. supplied custom chairs and that magnificent birds-eye maple table, which seats 16 to 18.

“It was designed to be reused during First Ministers’ conferences,” Kelemen confided. “They (the feds) asked us to put a removable ring of inlaid copper maple leaves around the tabletop.”

Then he laughed out loud: “Don’t know whether it’s true, but the rumour is they wanted the removable ring so they could use the table in Quebec.”