A Bridgewater company that provides back-office and contract services to businesses on Nova Scotia’s South Shore is expanding across Canada in the wake of a seven-figure deal that closed during the pandemic.
“Right now is when we need entrepreneurs to step up and create jobs,” says Martin Balcome, president and CEO of BMI Ltd.
“This deal still made sense during the pandemic. The world stalled but it didn’t change.”
He clinched the deal to buy Liverpool serial entrepreneur Bill Smyth’s OnPayroll.ca Canada for an undisclosed amount on Aug. 4. Its operations have already been moved from Liverpool to Bridgewater and are being integrated into BMI’s staffing division.
“If we can understand the market and why they are using our services, there will be no limits to what we’re doing,”
- Martin Balcome
BMI has hired three new employees -- a chartered professional accountant, an integration expert and a customer service staffer -- to handle the dovetailing of the companies’ staffing operations.
With the acquisition, BMI’s revenues are expected to almost double. Its workforce, including those on its payroll but contracted out to clients, has already more than doubled, jumping from about 50 to 105.
OnPayroll.ca Canada had roughly 45 clients in the United States. Its 55 employees are based out of Ontario, Alberta, British Columbia, Quebec and Atlantic Canada.
The deal propels the family-owned business on the South Shore onto the international scene.
“There are no boundaries. If we can understand the market and why they are using our services, there will be no limits to what we’re doing,” says Balcome.
His parents, Harry and Nancy Balcome, founded the company 43 years ago in Blockhouse, a small community outside Bridgewater, and ran it out of a house-sized building. In those days, the company provided machine and welding services and repaired trailer hitches, snowplows and farm and industrial equipment.
Over the years, the company added other services and moved to its current location, a two-hectare property with a modern 13,500-square-foot building on the outskirts of Bridgewater, in Oakhill. Then, it added another 9,000 square feet of building space to that location.
Martin Balcome and his brother, Bradley Balcome, joined the company in the late 1990s.
Today, Martin owns 60 per cent of BMI. His parents, brother and sister, Leanne Bennett, own the remaining 40 per cent.
In addition to staffing solutions, BMI offers recycling and waste management, metal fabrication and repair, and wood pallet, container and crating services.
Client's problems are BMI's problems
“We went from about 100 per cent of our business one day to about five per cent the next day.”
Even a global pandemic wasn’t enough to shut the business when lockdowns began in March.
“We didn’t close down one day,” says Martin Balcome.
The economic hardship faced by BMI’s clients, though, rippled through the industry. Many of those businesses canceled contracts for BMI services, particularly in the area of staffing.
Suddenly, many contract employees provided by BMI found themselves out of work.
“We went from about 100 per cent of our business one day to about five per cent the next day,” says Balcome.
“We had to lay off all our staffing employees (in the third week of March).
“These are highly skilled tradespeople. We had 34 of them . . . and all but four of them went out the door.”
In self-isolation after a vacation down south when the lockdowns began, Balcome relied on his staff as the worst of the pandemic affected his business.
In its nine-person manufacturing division, BMI makes wooden pallets and crates and undertakes metal fabrication. The customer for those pallets shut down for three months. Other contracts were put on hold.
Availing itself of the Canada Emergency Wage Subsidy, a federal program that covered up to 75 per cent of an employee’s wages, BMI kept many workers on the payroll.
“Business stayed down so we initiated projects for our recycling side that we needed,” says Balcome.
“That kept them working.”
Recycling was deemed an essential service. Most of the eight jobs in that division were safe.
But the pandemic also forced BMI to adapt to a different way of doing things.
“We had to look at how we processed each piece of material for recycling,” says Balcome.
“There’s a product that we bail. It’s a two-person job but we changed the height of a table so that it could be done by one person. It wasn’t as efficient but it was manageable.”
The company renovated its lunch rooms to allow for social distancing and put in place a staggered lunch schedule. Face masks became mandatory. Anyone dealing directly with customers was protected by a Plexiglas barrier. Hand sanitizer bottles were placed everywhere. Disinfectant was sprayed on every machine after use.
Revenues plummeted during the first few weeks of the pandemic. Then, in June, things slowly started to pick up.
“We were down to 25 to 30 per cent of our normal revenues,” says Balcome.
As the first wave came and went, businesses adapted. BMI’s revenues are now back to normal, and the company is looking to grow.
In its market segment, BMI goes toe-to-toe with large multinationals. Sheer size allowed it to ride out the storm, says Balcome.
BMI’s local ownership gave it an edge. It was nimble enough to respond quickly to changing market conditions.
“A lot of our competitors are multinationals,” says Balcome.
“They would make a blanket policy for all their locations and it didn’t really represent the situation here. We were able to better respond to that situation. Our fantastic people is what made this work.”
Although the staffing division carries with it a smaller profit margin than that enjoyed by the company’s other units, it provides an opportunity for the company to grow without dramatically increasing fixed costs beyond the purchase price for OnPayroll.ca Canada.
That deal is an opportunity for the local company to compete with bigger players.
“It’s a volume business, and that’s where it becomes a challenge locally because the large multinationals have their size, which allows them to commoditize those costs,” says Balcome.
By growing the staffing division through the bank-financed buyout of OnPayroll.ca Canada, he is hoping to lower the costs per contract employee for hire and boost the profit margin.
The U.S. elections, civil unrest and a growing second wave of the pandemic all make mid-range economic outlooks problematic.
Balcome, though, is bullish.
“The United States with their 331 million people are a strong organization, a strong country,” he says.
“There are problems coming but they’re still strong.”
A member of the Atlantic Canadian chapter of Entrepreneurs' Organization, Balcome credits the global non-profit with helping him take a closer look at his company and think big.
“All you can do is look at what’s in front of you and deal with it,” he says.
“We will continue to look for the right opportunities.”
The Pivot is a regular feature about an Atlantic Canadian company adapting to new market realities with innovative products, services or strategies. To suggest a business, email: [email protected].
