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When competition came knocking, Gagnon Frères reinvented Gagnon Frères with a smart, localized approach to merchandising that has helped him stand out in the world of retail furniture   

Gagnon Frères saw increased success in a lot of product categories in 2013, including decorations and accessories, sectional sofas, and wood and glass dining tables.

Frederic Gagnon never intended to run the family business. After spending his adolescence in Montréal and two years in the south of France, though, a tragedy struck that altered his path. Gagnon’s brother died in a car accident, and when Gagnon went to check in on the family business in the small town of Chicoutimi, Québec, he discovered things were not going well. The year was 1982, the economy was bad, and businesses were closing every week. Gagnon pitched in to help, and now, more than 30 years later, what he originally pictured as a year-long hiatus in the family business has turned into a career in retail along the Saguenay River.

Frederic Gagnon
Frederic Gagnon

Gagnon’s grandfather started Gagnon Frères as a small general store in 1904, and the company has since evolved into one of Québec’s leading independent furniture retailers. When Gagnon took over in 1982 and watched his cousins go bankrupt with a similar company, he knew he’d have to reinvent Gagnon Frères based on products and customer service.

“The bankruptcy was proof that no company can live on reputation alone,” he says. “Everyone told me how inspirational my grandfather was, but we had lost that spirit. I wanted to innovate and try new things again.” Gagnon started by eliminating product lines and closing small stores to make the company more efficient. Then he set his sights on understanding his customers and his competition.

Gagnon discovered a stark contrast between English-and French-Canadian customers and set out to offer products that would appeal to the French market, which represents the vast majority of his customers. French Canadians, he says, are influenced by European trends, whereas English Canadians prefer more-traditional pieces. Today, thanks to his efforts, Gagnon Frères has eight branded stores and one liquidation centre.

When choosing products, Gagnon “focuses on finding the right design at every price” while keeping his selection process up to date with the latest design trends, and at each of his company’s locations, he strives to create a full shopping experience. For example, his sales teams present beds with completed and matched covers, skirts, and pillows. “Our customers have a very good sense of what their house will actually look like,” Gagnon says. “We want to give them ideas, and we want them to buy more than furniture. We sell tables, lamps, carpets, and more. We want them to buy everything they need straight from us.” The company even offers a free décor service that makes house calls. The holistic strategy has helped Gagnon raise the total price of an average sale.

Gagnon’s product offerings seem to be resonating with local customers. Although based in a small region with just five percent of the province’s population, Gagnon Frères is a top-five independent furniture retailer with strong market penetration. In fact, suppliers who want to be distributed in southeastern Québec need to partner with the company. This has helped Gagnon beat back the tide of competition, and when big retailers enter the market, they find their standard product lines don’t attract repeat customers. Plus, those competitors often have back orders whereas Gagnon keeps local inventory to eliminate wait times.

With 9 stores, 200+ suppliers, and 5,000+ products, Gagnon Frères has grown to offer furniture, appliances, bedding, and accessories.

Still, the threat of stolen business keeps Gagnon on his toes. He finds and develops new products by staying in close contact with suppliers and by sitting on the board of directors for his buying group, Les Marchands PAS. He attends the High Point Furniture Market and other shows, shares deals and ideas with other Québec retailers, and travels the world to discover new trends. “It’s useful to see what’s happening in the high-end segment because that’s what’s going to be copied by the medium-price furniture manufacturers,” he says.

After discovering that 80 percent of his customers do “preshopping” online, Gagnon is again adjusting his approach by personally training his employees to assess customer needs and make suggestions. He instructs each salesperson to help each customer on a home décor project and to win repeat business by forming real relationships rather than focusing on individual sales. “We have to show our customers that there is value in meeting with a real sales professional in a brick-and-mortar store,” Gagnon says. “When the president is involved in training, it makes a difference.”

Gagnon’s strategies are working. The past five years have been the best ever in the life of his company. And in the coming 12 months, he hopes to see Gagnon Frères top its own sales records by another five percent.