Q&A

Jelinek Cork Group

Flexibility keeps cork supplier afloat

Last Updated: Friday, October 29, 2010 | 8:58 AM ET

By Alex Mlynek, Special to CBC News

Sonny and Jay Jelinek of the Jelinek Cork Group create cork-based building products, fabric and automotive parts. (Jelinek Cork Group)Oakville, Ont.-based Jelinek Cork Group has faced a number of challenges in its 155 years. Founded in what's now the Czech Republic, this family-run business was forced to move to Canada in 1948 due to political tensions, it has dealt with major shifts in the marketplace — and on July 23 this year a fire ripped through its head office.

Adaptability is the key attribute that has helped this small business, which employs about 50 people worldwide, deal with adversity and grow to become a major global cork supplier.

The company's product line has evolved from beer-barrel stoppers to wine stoppers and now includes cork-based building products, fabric and automotive parts. And recently, Jelinek Cork has distinguished itself with its environmental commitment.

The company won the 2007 environmental leadership award at the Oakville Awards for Business Excellence, and runs a wine-cork recycling program in conjunction with grocery chain Whole Foods. This helps the planet, but it's also a smart business move: Jelinek makes products with the ground-down or shaved used corks.

But it all starts with the raw material itself, cork, which, managing director Sonny Jelinek describes as a renewable resource with interesting properties.

"Cork is the bark of a tree that grows in the Mediterranean region," he explains. "And when this bark is peeled off of the tree, the tree is not harmed in any way and the bark can be reharvested every nine years."

Jelinek, who runs the company along with his brother Jay, spoke to CBC News about why the sustainable approach works best for them, how to deal with a crisis and the best ways they've found to run a family business.

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CBCnews.ca: Jelinek Cork's motto is "Eco-friendly since 1855." Was there always an eco side to the company or is that more of a recent development?

Sonny Jelinek: It's a development that we naturally fell into. Cork can essentially be used anywhere synthetic materials are used, but we face tremendous competition from synthetic materials in every aspect of our business. But until foams and plastics came to the forefront, there was no focus on the natural [at Jelinek Cork], because it [our product] just was natural. It's when people started using non-natural materials that we started to realize the importance of using natural materials, not only for the planet, but also for individual health.

CBCnews.ca: Do you see your product's environmentally friendly qualities as a competitive advantage?

Sonny Jelinek: In some ways. But we firmly believe that in order to compete you can't just rely on having a green, natural product. Most people will not pay double the cost for a natural product just because it's a natural product. So we've tried to make everything we do competitive on a price-point basis and on a performance basis.

CBCnews.ca: How long ago did synthetics come to the forefront?

Sonny Jelinek: Probably the early '90s. At the time, winemakers started converting to using synthetic corks and screwcaps, and that's when the realization came that we have to compete on being more than just what we were for many years.

CBCnews.ca: Are wine stoppers the biggest element of your business?

Sonny Jelinek: No, the No. 1 product for our business is sheets and rolls of cork that are used for underlayment to reduce sound.

CBCnews.ca: How is Jelinek Cork environmentally friendly, outside of the product itself?

Sonny Jelinek: We're working towards becoming a paperless office. We have recycling programs internally for containers, and so on. We try to use recycled packing material. We're trying to become energy-efficient.

The Jelinek showroom features makes products with the ground-down or shaved used corks. (Jelinek Cork Group)

We just had a fire and we're rebuilding one of our facilities and looking to install a green roof on the warehouse and skylights to reduce power consumption.

But it all ties back to what we do every day. In order to really perform and really feel great about your job, you have to have kind of a higher motivation. Otherwise, it's just a job.

CBCnews.ca: Sounds like a great human resources strategy.

Sonny Jelinek: Well, it is. But it's so natural, it's the truth, and we're not selling this strategy as, "come to work and feel great about what you're doing." You are doing great things by selling cork. It is a great human resources strategy, but it's real.

CBCnews.ca: Is there anything you've adopted that you would recommend to other small businesses in terms of the environmentally friendly approach?

Sonny Jelinek: Well, looking at things you can do sustainably will help the company decrease costs. For example, if you can reduce your reliance on heavy electrical use by changing the lights in your facility, you're reducing your expenses and you're reducing the impact on the environment, on hydro.

We also are looking to virtualize almost every aspect of our back office. So what that means is that an employee could work from home with a phone that's connected to our office phone system. Their computer would allow them to connect into our back end inventory and order-entry system, and it would be just like they're there.

I'm a big believer in interaction, and I still think it's important to have a central point where people can meet face-to-face on a regular basis, but if necessary, creating this back-end that's virtual, essentially allows the company, or individual employees, to operate from anywhere.

CBCnews.ca: Employees would also avoid greenhouse gas emissions by not travelling back and forth to the office and home.

Sonny Jelinek: Exactly. We have someone in Calgary who used to work here, but it made more sense for them to work closer to customers. They meet with us on a regular basis online, or over the phone. They can do everything they were doing here, but we're reducing this flying back and forth.

CBCnews.ca: I wanted to talk a bit about the fire. Did you have a pre-existing plan, not for dealing with this specific crisis, but for management of this type of situation?

Sonny Jelinek: We had one in place, but regardless of what plan you have you never can fully anticipate the impact of a crisis until that crisis occurs. So, it did require a lot of scrambling. It did require a tremendous amount of leadership. Our team across the board stood up and put in extra effort to adapt to that.

CBCnews.ca: You are the fifth generation of Jelineks to run the company. Can you talk about the key to a successful family business?

Sonny Jelinek: One of the great things that my dad did was, he stepped away from the business when he felt it was time to let my brother and I run the company. Now, he stays in contact with us but he's given us complete control of the company in terms of running it how we feel is best, which may be different from the way that he would have felt.

Founded in what's now the Czech Republic, Jelinek Cork Group was forced to move to Canada in 1948 due to political tensions. (Jelinek Cork Group)Dealing with family and business, the key is allowing family members to take responsibility for whatever area they're working on, and trust that they're doing it right, and not second-guess them.

I'll give you a perfect example. A number of years ago, probably about 1990, my brother came up with the idea of Corkstore.com, an online store that sold cork, and everyone kind of laughed at him, including myself. But we put the cork store in place and within a few years it was generating $1 million in annual sales. Everyone who was laughing at my brother for coming up with this idea stopped laughing and realized what a viable business he had created.

CBCnews.ca: Does your sister Keena work with the company?

Sonny Jelinek: She is involved with our websites and with a lot of the back-end computer systems.

CBCnews.ca: Was it a given that you, your brother and your sister would work at the company, or did you have to prove yourself before you were able to take on that responsibility?

Sonny Jelinek: It wasn't a given at all, not necessarily in terms of proving ourselves — my dad was great in terms of how he really trusted our abilities — but in terms of us wanting to go into that business.

Truthfully, I plan to do exactly what my dad did, which is to let my son, or my brother's kids, or my sister's kids make their own decision about wanting to come into the business.

Obviously, you do want family continuing the business, particularly a business that has the history and the background that our company does. But that's not a decision for a parent to make, that's a decision for the next person to make.

Pushing someone into a business that they may not want to be in will just lead to disaster.