The man who missed his mark

Disagreement over the chain's future also estranged Mr. Blumes from his identical twin brother, Moe, who had served as Mark's chief financial officer before bolting. Mr. Blumes, 58, has wrestled with demons ever since. He has undergone intense psychotherapy. He has divorced.

The National Post
December 20, 2001

The man who missed his mark
Failed businesses, divorce, diabetes, psychotherapy for Mark's founder
Brian Hutchinson

For Mark Blumes, the irascible, cigar-chomping founder of Mark's Work Wearhouse Ltd., the year won't end soon enough.

Last week, the entrepreneur once thought to be worth $5-million declared personal bankruptcy. He has lived in the basement of his girlfriend's house since his latest venture, a dot-com retail outfit, went bust.

Yesterday, Mr. Blumes learned that Mark's Work Wearhouse, the retail company he launched 24 years ago, will be bought by Canadian Tire Corporation Limited. The cash deal is worth $116-million.

Mr. Blumes will recoup nothing from the sale.

Slumped on a bench inside Calgary's Bad Ass Coffee Co., a trademark stogie stuffed in his mouth, Mr. Blumes seemed numb. "I, I feel no emotion of any kind," he stammered.

Then yesterday's news sunk in, stirring unpleasant memories.

Mr. Blumes is the all-but-forgotten "Mark" in Mark's Work Wearhouse. The Calgary-based chain, which
Mr. Blumes started with a $27,000 investment, is considered Canada's leading outfitter to the blue collar set.

According to Mr. Blumes, the store lost its way long ago.

"I hope Canadian Tire puts the work wear back into Mark's Work Wearhouse," he said. "When I left, the board of directors was only interested in selling ladies sweaters."

Mr. Blumes was turfed as the company's chairman and chief executive in 1996, after years of mediocre results and bitter disputes with its board. Disagreement over the chain's future also estranged Mr. Blumes from his identical twin brother, Moe, who had served as Mark's chief financial officer before bolting.

Mr. Blumes, 58, has wrestled with demons ever since. He has undergone intense psychotherapy. He has divorced. He has coped with diabetes.

"I'm struggling," says Mr. Blumes. "But I won't give up. I'm a proud animal."

While Mr. Blumes has started a few new companies since leaving Mark's, none have succeeded. Sadly, he has never regained the magic that allowed the chain to carve itself a solid niche in the Canadian retailing scene.

A life-long Calgarian, Mr. Blumes cut his teeth at the Hudson's Bay Co., eventually becoming a regional merchandising manager for its bargain basement section. In 1977, he was fired for what he calls "insubordination."

Relying on his knowledge of discount retail, Mr. Blumes decided to gamble his $27,000 severance payment on a revolutionary concept: selling mundane, durable work wear in bright, friendly surroundings. For too long, Mr. Blumes believed, blue collar clothing had been peddled in dimly lit department-store basements. In late 1977, Mark's Work Wearhouse was born.

Operating from a single outlet in Calgary, Mr. Blumes moved $20,000 worth of work boots, shirts and gloves his first day. His timing, he reckoned, was perfect. Thanks to unprecedented oil and gas revenues, Alberta's economy was booming. "We hit it just right," he recalled later. "You could have wrapped s—- in red and green ribbon and sold it."

Three years later, Mark's had expanded to 34 stores, in five provinces. Mr. Blumes added a dozen more stores the next year, and revenues hit $100-million. But the rapid expansion left the company in debt. In an effort to raise cash, Mark's went public in 1981.

The $10.2-million offering was oversubscribed, and sold out in a matter of hours. Mr. Blumes made an instant $500,000.

Three months later, his twin brother Moe joined the company as CFO. "He's everything I'm not," gushed Mark Blumes. "Thoughtful, bright, a very clever accountant."

But Mark's began to founder, lurching from one dubious investment to another. Mr. Blumes opened an American subsidiary, Mark's Work Wearhouse of Wyoming Ltd. He purchased on behalf of the company three import automobile dealerships. He flirted with the computer business. He bought a large house, with a tennis court and swimming pool.

Launched just as Alberta's petroleum boom was ending, the spending spree seemed at odds with Mr. Blumes' blue collar ethos. "Our focus is on the working man and his family," he insisted. "They can be as fat as they want, as big as they want. We have a predilection to large sizes. We're gonna own the goddamn jean business."

Attempting to remind jaded customers of his company's roots, Mr. Blumes produced in 1986 a country and western song, called The Oil Patch and Me. A paean to the long-lost days of boom, it had, according a Financial Post reporter, "the catchy melody and tempo of a three-minute advertising jingle."

It's going to come full circle/Just you wait and see.

The lyrics could have been written with ailing Mark's in mind. The company's share price had fallen below a dollar. Its nine U.S. stores were bleeding red ink; by 1987, the U.S. subsidiary was bankrupt.

Three years later, Mark's lost $10-million, on sales of $173-million. Mr. Blumes was forced to close 14 of the chain's 143 stores, and sell the car dealerships.

In 1991, following a nasty spat, Moe Blumes quit the company. Mark responded by piling his brother's belongings on the street outside Mark's southwest Calgary headquarters. "[Moe] had a very different view of this company," Mr. Blumes shrugged.

(After moving to Kelowna, B.C., Moe Blumes began work on an autobiography. Working title: I Am Not
Mark. It was never published.)

Although Mark's eventually returned to profitability, it remained a stock market laggard; by 1995, its share price hovered around $1, a "pretty boring investment opportunity," Moe sniped from his Kelowna exile at the time.

Mr. Blumes devised a new strategy. He had discovered the Internet, and wanted Mark's to move aggressively online. The company's board, while intrigued, had what it thought was a better idea: replace
Mr. Blumes with Garth Mitchell, a retail veteran with a background in women's wear. In December, 1995,
Mr. Blumes was bounced as Mark's chairman and chief executive.

The board's reluctance to embrace the Internet "was only part of the problem," Mr. Blumes recalled yesterday, from his perch at the Bad Ass Coffee Co. "This will sound self-serving, but my role was to protect the interests of the working man. The company went margin crazy. You can't make the same margins selling work wear as you can selling ladies sweaters."

The bigger issue, Mr. Blumes admits, "was a clash of personality. I created the reasons why I'm no longer there, by my lack of charm."

Having negotiated a $900,000 severance payment, Mr. Blumes again set off on his own. He entered psychotherapy. He began writing an autobiography of his own. (Working title: Wherever I Am I Want to
Be Where I'm Not. It was never published.)

In 1996, Mr. Blumes announced he was back in business, unveiling Mark's Virtual Store Inc. Described as a "practical, down-to-earth conduit to this mystical thing called the Internet," it was supposed to sell everything from home appliances to hockey sticks over the Internet. It bombed.

Three years ago, Mr. Blumes unveiled another Internet venture, Inc., designed to flog industrial safety equipment. The publicly traded company obtained a listing on the Canadian Venture
Exchange, and raised $2-million.

Mr. Blumes was instrumental in raising the money, admits a former senior officer with the company.
"Unfortunately, the rest of the story is very sad," he says. "We had no revenues. The money is all gone.
We spent it. Mark has lost everything. Everything."

Earlier this year, Mr. Blumes was fired as PatchGear's president. The company is now defunct.

"I'd be lying if I said it hasn't been tough," Mr. Blumes said yesterday. "But Moe and I are now speaking, which is good. He's been trying to support me in lots of ways. I try to stay optimistic about the things I'm working on."

Not one to wallow in self-pity, Mr. Blumes has plans to launch yet another Internet company, as yet unnamed. "It's going to offer custom poetry for weddings," he says. "That's the game I'm in now, the wedding business. I've got a pretty good feeling about it."


Risks: Portrait of a franchisor, Bankruptcy, Imminent death, Divorce, Delusional thinking, Diabetes, Canada, 20011220 The man

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