Portrait of a predecessor: Frédéric Gagnon of Gagnon Frères
Many business owners find their successors within their own families. This was the case for Frédéric Gagnon, who himself took over the family business before deciding to hand over management of the Gagnon Frère chain to his wife Virginie Théberge.
Frédéric Gagnon was in his 20s when he took over the reins of the Gagnon Frères chain, which was founded in 1904 by his grandfather Jos and his great-uncle Louis. “It was 1982. The company was in financial difficulty, and despite my young age and the economic crisis, National Bank agreed to support me,” he recalls. Under his leadership, this Saguenay–Lac-Saint-Jean flagship, which now has seven branches, became specialized in furniture sales. In 2023, after 40 years of loyal service, Frédéric took his well-deserved retirement. He left with peace of mind, knowing that his partner Virginia Théberge, who’s 15 years his junior, was ready to take over.
Recognizing leadership qualities
“Virginie has a lot of energy, creativity, and leadership skills. She’s an entrepreneur at heart who isn’t afraid of challenges. She has a solid strategic vision, and when change is needed, she mobilizes all her teams to make it happen,” says Frédéric. It was for all these reasons that he appointed her marketing director in 2007. He quickly realized that she had the ability to take on much more responsibility. As in many family businesses, the transition began even before succession was an issue.
Adapting the company structure
National Bank, which has supported Gagnon Frères since its founding, has been involved in every step of the transition. “Since the Bank’s team is familiar with our financial structure, they can tell us which levers to pull and which limits to respect in order to avoid taking unnecessary risks,” notes Frédéric. Initially, Virginie benefited from an employee share ownership plan that allowed staff members to acquire shares in the company. Subsequently, she and Frédéric developed a strategic plan to become co-shareholders, which involved significant financing to buy back shares held by members of the extended family. More recently, the couple opened up their shareholding to three members of staff, although they retain a majority stake. “Virginie pointed out to me that if we wanted to ensure the company’s long-term future and meet the challenges ahead, we had to involve our management team,” explains Frédéric.
During those years, the retail industry underwent a profound transformation, from online sales and enhanced customer experiences to new competition. Before formalizing the transfer of power, the partners joined forces to completely overhaul the company’s operations. Virginie took control of day-to-day operations while Frédéric oversaw the implementation of a new computer system. Gagnon Frères also acquired a new 140,000-square-foot warehouse, allowing it to centralize its operations. “As CEO, Virginie has reinvented our entire logistics system and redesigned our sales management methods to better suit today’s reality. In its 120-year history, Gagnon Frères has undergone several reorganizations. I managed one or two myself, but the latest is the most significant,” says the businessman.
Trusting the next generation
For family business owners considering succession, Gagnon Frères is certainly a model to follow. “In the past, running a business was more like a one-man show: we managed day-to-day operations and made adjustments as we went along. Today, it’s extremely risky to operate that way,” warns Frédéric. “The industry and the market are much more complex.” According to him, for a business to endure, you need to plan transitions, work as a team, and consider the vision of the next generation. “The worst thing that can happen is to devote your life to an SME, only to watch it struggle until it closes.”
This is certainly not the case for Gagnon Frères, which has just begun a new chapter in its long history. “After 40 years in the business, I’m proud to see this century-old company move to the next level thanks to Virginie and her team,” says Frédéric. In addition to remaining involved as chairman of the board, the young retiree acts as a mentor and provides training to the sales teams. “From time to time, people come to me for advice. I’m part of the company’s success!
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