Innovative solutions for the hospitality sector
Business View Magazine interviews Vincent Beaudet, CEO of LOC International, for our focus on Innovations in Manufacturing
LOC International is an innovative and agile Canadian company that provides a range of in-room electronics to the hospitality industry in Canada, the United States, and the Caribbean. Headquartered in Montreal, with offices in Toronto, Edmonton, Vancouver, New York, and Nevada, the company counts a roster of A-list hospitality industry including all major brands as its clients.
Although the recent COVID-19 pandemic pummeled the hospitality industry, the company continued thriving amid the economic chaos. “When the pandemic hit in March 2020, we took a step back and worked for three months, non-stop and full time, on our marketing, offering and branding,” says Vincent Beaudet, President and CEO of LOC International. “We set up a new website for an automatic touchless dispenser called LOC Sanitizer that did very well within the hospitality business. Soon after launch, sales had grown so much we started selling to distributors who were supplying all kinds of verticals like offices, restaurants, bars, and retail. The pandemic hit our core industry hard, but we continued growing because we ran a lean and agile operation while consistently focusing on innovation.”
LOC International started in 1988 as a small operation solving the challenge hotels were facing when managing in-room minibars. “At the time, we came up with a straightforward solution to install a small plastic tag on each minibar,” explains Beaudet. “You had to break the seal and then use the key to access the minibar. The solution was called a Mini Loc, which is how our name LOC came into existence. Soon our founder, Richard Tanguay, started looking into other product lines like door locks and in-room safes, which it started distributing and eventually contracted a Chinese supplier to manufacture branded products.”
In 2000, the company got into the hospitality key cards industry, which proved to be an extremely well-calculated move. “We were doing about 85 million cards a year,” says Beaudet, “which was completely unheard of for a company as small as ours.” The waves the small upstart was making soon caught the attention of the big players – and North America’s largest keycards player, that industry leader came knocking.
Beaudet admits, “I guess we annoyed them, and in 2011, they bought our keycard division.” Because of a non-compete clause in the acquisition, and the card business accounting for a considerable chunk of the company’s overall business, the company leaned down and kept running. “We continued selling safes and fridges, and when the non-compete ended in 2018, we rebranded the company and added a bunch of new products to become a one-stop shop for in-room electronics,” Beaudet adds.
Today, the company is a Canadian leader in the manufacturing and distribution of products for the hospitality industry. Its comprehensive list of in-room products includes door locks, keycards, compressor-less fridges, safes, TV, air conditioning, radio alarm clocks, in-room phones, digital signage and interactive kiosks, sanitizer dispensers, and more.
“We work with some of the leading brands in the space like Danby, Bittel, NONSTOP, MIWA and LG besides our own branded products to offer a complete in-room turnkey solution to hotel owners,” says Beaudet. The company also recently secured an exclusive Canadian distribution agreement with Virdee, the leader in self-check-in kiosk and mobile application solutions, a direction Beaudet believes the entire industry is shifting towards in the wake of staff shortages and the need to operate more efficiently.
When he says the company operates a lean and agile operation, Beaudet is not using semantics. The company serves thousands of clients with a workforce of just 15, a feat made possible by the operational strategy the company utilizes. “How do we manage with such a small team?” he asks. “We subcontract. We have a large network of approved and authorized integrators & installers for each product line.” Further bolstering the company’s ‘lean and mean’ corporate culture is a determined focus on hiring and keeping the right kind of employees, which is another integral component of the company’s success.
“When recruiting, we don’t always look for the best background or employment experience, but we’re trying to find the right candidate who will fit in our team,” Beaudet states. “Because we’re such a small team, everybody talks to each other, and we are all tied up. We win together, and we lose together. The core mission shared with new hires is to find an opportunity in the market and bring it into the LOC International machine where we have specialists that will help close the deal and roll out the project. We design all our products, and then we work with a company in China that has extensive manufacturing capabilities to create the designs. For example, they have been manufacturing safes for us for nearly 20 years and are now manufacturing our sanitizer dispenser products.”
Working with an overseas manufacturer is not without its challenges, especially with supply disruptions occasioned by the Covid-19 pandemic. However, Beaudet says their culture of operating as a lean company worked to their advantage even while larger companies were struggling. “We’ve always worked with one or two containers at a time, which made it easy to get our inventory on time,” he explains. “In contrast, one of our suppliers, a large Canadian manufacturer that brings in hundreds of containers, was stuck because overseas suppliers were splitting consignments sometimes into 50 batches on different ships, causing a logistical nightmare.”
While the company has its operations purring smoothly, one area it has had to adapt is the massive change in the hospitality business landscape. Beaudet acknowledges, “During a crises like the Covid-19 pandemic, business travelers are no more, so business hotels are shutting down. At the same time, smaller hotels, bed and breakfasts, and the like are thriving because of local tourism. We are now going after those guys as our primary target market.”
Another vertical the company is actively pursuing is the cruise ship market, which has grown as people turn to it as an alternative way of traveling for leisure. “In 2020, we signed a huge deal with a leading Cruise Line company to fit their next three ships with safes. That deal opened our eyes to the size of the cruise line market, which led us to design safes and fridges fit for use in the unstable environment of a cruise ship.”
Besides designing cruise-ship-first in-room electronics, the company also has a line of compressor-less in-room fridges, which, as Beaudet explains, is the next step in the evolution of in-room fridges. “Most fridges use compressor technology, which accounts for higher noise. Although this is not a big deal in a home, because the fridge is usually several meters away in another room, in a hotel room, the fridge might be just a few feet away from your head, making the noise pretty bothersome. Our compressor-less fridge, LOC Frost, solves this by removing the noise-causing compressor component. In addition, it also saves up to 30 percent of energy costs compared to traditional fridges.”
Beaudet’s vision is to establish the company as a major manufacturer in North America backed by a substantial network of distributors. “Our current focus is to get our product models approved by major brands like Marriott and Hilton,” he says. “It’s a bit of a moving target because the technology evolves so fast, but we plan to depend on our culture of agility and innovation to match the expectations of these market leaders in providing the most innovative products to the market.”
Another area the company wants to establish itself further is being known as a turnkey solution provider in the hospitality industry. Beaudet shares a funny story to illustrate this: “We sold some door locks to a property. A month later, a business partner called me asking to put me in contact with a hotel owner. The gentleman who called said he owns a property and they’re looking for TVs and could we help? I said, well, sir, our team did your door locks about a month ago. We know exactly who you are, but you didn’t know we are also the number one Hotel TV distributor in the country!’’
Beaudet says the experience showed them there was more to do to unlock the full potential of the vast network the company has built over the years. “On the call, we laughed and said that we could have probably bundled everything together. Well, we bundled multiple solutions for the client, which is how we want to do business going forward.”
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AT A GLANCE
What: A leading manufacturer and provider of innovative products to the hospitality industry
Where: Headquarters in Montreal, Quebec