National Defence Committee on Nov. 2nd, 2023

[Michael Clark]

I'll borrow something and twist it into a hypothetical answer. If we have a product and DND would like to buy that product from us, but they find out through their means that we're the only company that makes this great, innovative...we'll call it a widget. They want to buy that widget from us, but we're the only ones who make it and we're in Canada. What do they typically do? In some cases, they may open that tender up to everybody to quote on.

It's like saying I'm going to Hamilton next week and I need to get a new set of wiper blades, so I go to Canadian Tire, I get my wiper blades and I put them on. I don't go and get three quotes from three different places to buy my wiper blades. I probably paid a fair market price for them, but I got them right away because time was critical.

That's the type of thing when DND wants something and there's a Canadian manufacturer that can make it, and the analysis is, “Is there value for money?” You're buying a Canadian product that's made in Canada. Do you have to pay a few pennies more? Possibly, but what's it going to cost for you to go through a bidding process and evaluate products from around the world and everything else? Is there still value for money? Sometimes it's easier and quicker. You might pay a few pennies more, but you're going to get what you want and you're going to get it more quickly.

I don't know if that answers the question.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

Yes.

You also talked about those larger businesses versus the smaller SMEs. Do you believe, ultimately, that Canada could show a great deal of strength through more involvement in the diversity of those smaller SMEs?

[Michael Clark]

I'm not sure what you mean by diversity.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

Would more involvement and the strength of that Canadian innovation strengthen more projects, in your opinion?

[Michael Clark]

I think so, because success will breed success. In the case of the company I told you about that said, “Three years? I'm not going to get involved in that” and went elsewhere, if you could have turned that project around for this company and it could have been a success and they did it in a year and a half, they might look at it and say, “Okay. That's worthwhile.”

We have a team of R and D people that we could throw at some other projects for DND. In some programs within DND, such as the IDEaS program, the government is looking for solutions. If Canadian companies are around that have the talent, but they don't know about the program because they don't play in the defence sector, you're missing out on some great ideas and some great researchers.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

You spoke about the industry associations and making better use of them in getting involved and having them help you. Of course, we heard from CADSI on their perspectives toward the procurement process.

As a direct manufacturer, though, do your opinions differ from CADSI's and what they presented here to this committee? Maybe you can talk about your relationship with them specifically.

[Michael Clark]

FELLFAB has been a member of CADSI for, I think, 20 years. I've been affiliated with the association for about as long as that.

CANSEC at one point in time used to be at the Ottawa Convention Centre, which is now the Shaw Centre. It was very small in comparison. It eventually ended up at the EY Centre. The show is mammoth. It is huge. You spend two days running a million miles an hour with your head on fire. It's a tremendous event. I think CADSI does a great job.

CANSEC is just one of the events they host. In the spring, they host the Outlooks, which is a tremendous.... It's one day for each branch of the service, and that is where you get to meet some of the people and have face-to-face conversations, instead of running around a million miles an hour with your head on fire.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

So they spoke—

[The Chair, Liberal, John McKay]

Thank you, Ms. Mathyssen.

Then is the recommendation that DND should shop at Canadian Tire? Is that...? Let me write that down.

[Michael Clark]

They have more than just tires.

[The Chair, Liberal, John McKay]

There we are. I think we have a title for our report.

Colleagues, we have some other business after this meeting with Mr. Clark.

Is there an appetite to shrink the second round a bit?

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

No.

[The Chair, Liberal, John McKay]

There is no consensus. We're shrinking it a bit. There will be a minute off everybody, and we'll do it that way.

You have four minutes, Mrs. Gallant.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Mr. Clark, this June we heard stories that our own soldiers in Latvia had to buy their own gear in the middle of deployment because it was outdated and of such poor quality that it prevented them from carrying out their operational mission.

Are individual soldiers able to purchase equipment directly from you?

[Michael Clark]

I read that article, and I think they called it Gucci gear or something.

The products we built in the past for the “Clothe the Soldier” program were to a DND design. In many cases, some of the products we build are to a prime contractor's design. We don't own the rights to those designs, so we wouldn't be able to sell the product.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Okay, so—

[Michael Clark]

I was going to say that we do have outerwear that we produce as our own line, so yes, if DND wanted to call us to buy some, we absolutely could sell it.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

What about individual units? Do any individual military units buy from you directly?

[Michael Clark]

Yes.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

How do you find dealing directly with a unit or a regiment, as opposed to going through Public Works and DND? Is it smoother and more streamlined?

[Michael Clark]

Absolutely.

We do a line of Arctic-rated sleeping bags. We provide them for certain departments of the armed forces that go to the north. They'll call up and say, “Can I get 10? Can I get three?” They'll process it on a credit card, and they can buy it that way.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Is it quick?

[Michael Clark]

It's about as quick as calling any e-retailer. You can just say, “Can I buy one?” “Yes.” “Here's the purchase order.”

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

How long would it take if they had to go through all the machinery of government to do that?

[Michael Clark]

Typically, government is not going to want to go to tender to buy 10 of something. It's going to want to buy 100 of something. You're going to have to write the statement of requirement from DND, and then it goes to PSPC. PSPC does a whole tender process and issues a tender. There are questions and answers, and the next thing you know, three months go by before anything's done.