Special Report: Legault Group

Special Report

Legault Group

Last summer, the Legault Group, which owns the Mondou retail chain —both based in Quebec, Canada—made its first business foray outside of the province by acquiring Ren’s Pets, based in neighboring Ontario. Company leadership has indicated the move is in line with long-term goals to not only grow in physical store count but also to expand omnichannel capabilities. The acquisition will also solidify and strengthen the Legault Group’s vertically integrated infrastructure, which in turn better protects its production integrity. Brothers Jules and Philippe Legault have built a sizable enterprise since they first purchased the Mondou banner in 1983. However, the family’s success is rooted in humble beginnings, and the measured approach to growth and expansion that the Legault Group has taken in the last few decades reflects how well it has balanced ambition and responsibility in this ever-evolving pet industry.

Company History

Jules Legault, President and co-owner of Legault Group, recounts the family’s roots in business. “With only a third-grade education, my grandfather Jules Legault started a seed company in 1919, Gloco,” he told Pet Insight recently. “When he died in 1944, my father took over the business and in 1978 he asked me to join him. I had completed my university studies in finance and accounting three years earlier and was working at Pricewaterhouse as an accountant.”

Gloco, which is still running and has expanded to organic fertilizers as well, was already doing business with Mondou, a company that at the time was selling grain and hay for working animals and straw for livestock. “In 1983, I suggested to my brother Philippe that we buy the Mondou store that we sold seeds and bird food to. Located in Montreal’s Jean-Talon market, this iconic store is still open today and was founded in 1938 by Joseph-Émilien Mondou. My training allowed me to handle not only the accounting aspects of the transaction but also the legal side.”

Under the Legault family’s leadership, Mondou had grown to 36 stores by 2001 and by 2018 during its 80th anniversary, increased its store count to 65 across Quebec. Meanwhile, the Legault Group in 1993 started its own line of dog and cat food, Vetdiet, which is sold exclusively in Mondou stores and on the company website. The Legault Group also co-owns Jupiter, a company that specializes in the production of dry cat and dog food.

The acquisition of Ren’s Pets this summer not only added 35 stores to the Legault Group’s total store count but also an additional distribution center in Guelph, Ontario. "This transaction is part of Legault Group's growth plan, which is based on expanding our activities in Canada through acquisitions and partnerships focused on innovation," said Martin Deschênes, CEO of Legault Group. "It will allow both companies to combine their strengths and accelerate their growth in Canada by opening new stores through an agile and flexible approach."

Mondou

Jules Legault indicated the company expects to have 76 Mondou stores open in Quebec by year end, employing upwards of 1,100 people. Through its well-paced and steady growth, Mondou now stands out in the Canadian pet industry landscape as much more than simply a pet supplies company. Its stores and employees are a trusted resource for pet owners on a multitude of animal welfare topics, which the company stays attuned and responsive to the needs of the communities it serves. In both 2020 and 2021, it was recognized among the prestigious Canada’s Best Managed Companies by the reputable firm De-

“It confirms Mondou's status as a leader in its field and in the wider loitte, lauded for its business community. We extend our warmest thanks to our devoted corporate strategy, and passionate employees, our experienced management team and our innovative approach valued partners who successfully rose to the challenges we have faced and commitment to in the past year. With the support of this exceptional team, Mondou was its employees and able to provide its customers with an experience that goes beyond their the community. Deexpectations, despite the pandemic and the restrictions in place.” schênes said in 2021 — Martin Deschênes, CEO of Legault Group of the award, “It confirms Mondou's status as a leader in its field and in the wider business community. We extend our warmest thanks to our devoted and passionate employees, our experienced management team and our valued partners who successfully rose to the challenges we have faced in the past year. With the support of this exceptional team, Mondou was able to provide its customers with an experience that goes beyond their expectations, despite the pandemic and the restrictions in place." Recent new concepts that Mondou has implemented include installing sub-zero refrigeration in more than a dozen stores to carry a wider variety of frozen raw pet food, as well as smaller neighborhood stores that also offer free services like nail clipping, dog washing, dog scales and car service. “Smaller in size, these stores allow us to get closer to customers in urban neighborhoods,” Deschênes explained in media reports. “They appeal to the community. People come there, often on foot, with their animals.” Mondou created a continuing education program Mondou Academy in 2007 led by veterinarians and vet technicians that helps staff stay up-to-date on industry best practices and to further develop their overall understanding of animal care. This fall—as further illustration of Mondou’s commitment to animal welfare and in line with several municipal regulations banning the use of aversive r Cont'd on Pg. 6

r From Pg. 4 collars—the company announced it was removing all aversive collars from its stores following the release of a report by Mondou's Comité aviseur en bien-être animal (CABEA), which concluded that alternative techniques and products are now accessible to all. Aversive collars include choke collars and all electrostatic (electric), vibration, citronella, air and ultrasonic collars for invisible fences, according to the company. "The knowledge we have of animals and of the care they require for their well-being has obviously come a long way since we started in this industry,” said Sarah Vaillancourt, senior leader of the Mondou Academy and training. “Above all, Mondou wishes to share its know-how with its customers, help families care for their pets in their daily lives and support them in finding solutions to the canine behavioral issues they may be facing. We have put a variety of measures in place to better handle these types of issues and to better direct pet families toward personalized products and advice.”

Since 2019, the company inaugurated four adoption zones for cats from rescue shelters at its Saint-Jérôme, Anjou, Saint-Jean-sur-Richelieu and Joliette store locations. To date, more than 500 cats found homes through the company’s effort.

Meanwhile, Mondou continues to support fundraising and awareness campaigns both within and outside the pet industry. Between 2018 and 2020, the annual Mondou Mondon fundraising campaign for shelters has raised more than $406,000 in donations. Its campaign benefiting the MIRA Foundation, which offers free guide dogs and service dogs for people living with visual impairments, physical disabilities and youths with Autism Spectrum Disorder (ASD) has also raised more than $2 million in six years.

“Mondou's objective is to raise an additional $430,000 to support this cause we feel so strongly about, and to give back to the community, one of the pillars of our brand and mission. On behalf of the entire Mondou family, I wish to take the opportunity to warmly thank all our customers, employees, suppliers and our media partner Rouge FM, who allow us to make a real difference in the everyday lives of thousands of people, year after year," Pierre Leblanc, Mondou's General Manager, said ahead of the launch of the company’s 7th campaign for MIRA, in September 2021.

Ren’s Pets

Across the Quebec-Ontario border, Ren Job and his wife Sharon opened the first Ren’s Pets Depot in 1975 as a small feed and supply store. Overcoming some initial challenges, including a fire, the enterprise evolved into a pet supply depot complete with its own 25,000-square-foot distribution center in Guelph.

In the last 40 or so years, Ren’s Pets grew to 36 stores across Canada, and CEO Scott Arsenault said a total of 38 stores are expected by the end of 2021 under the Legault Group leadership. Arsenault attributes Ren’s Pets long-term success to being able to focus on excelling where it can. “We’ve talked about quality and premium and making sure that diet is first and foremost and we’ve really fixated on what we’re good at,” he said. “We have a pretty storied history, we’ve been around for 40-plus years. We have really concentrated every thought on your pets’ best life and for dog and cat primarily. We understood that services were something that we didn’t want to be part or couldn’t be the best in the world at, so we made sure that we partnered with groomers and trainers and dog walkers.”

Arsenault said of the acquisition, "We are proud to join Legault Group and combine our strengths with the Mondou store network in order to pursue our development. We share common values with this respected team in the Canadian industry such as customer service excellence and a commitment to the community and the well-being and health of animals. We are confident that this transaction will

“Mondou's customer is front and center with great products, clean be beneficial not only to stores. Those things are very similar to Ren's Pets Depot. You’re finding both banners, but also to all a very similar business set to what we’ve got here at Ren’s. We’re going Canadian consumers who to operate separate and distinct but we’re going to take all of these care about their pets." synergies and best practices and apply them. You won’t see a name While the Legault Group change. We’ll continue to grow in Canada; they’ll stay in Quebec, and it’s works through the finer debeen great so far. It’s not a roll up by any means that you see sometimes tails of integrating its newwhere you start hacking and whacking. It’s a genuine growth story.” est acquisition, Ren’s Pets’ — Scott Arsenault, CEO, Ren's Pets Depot leadership continues to plow ahead with initiatives that helped the company rank as one of the fastest growing pet chains in 2021. In spite of the challenges the pandemic brought, including the banning of in-store shopping in Ontario for significant stretches of time, Ren’s Pets was ready with its e-commerce offerings. “A lot of people rushed that,” said Larissa Wasyliw, VP of e-Commerce and Marketing. “And it wasn’t plan B for us; it was always plan A. We were well down that path. We’d been servicing customers online across Canada for more than 10 years so we’ve been doing that for a long time. We already had that platform, implementing the bulk of buy online, pick up in-store. Those were some of the things that were already in the works pre-pandemic. It wasn’t new to us and we were ready.” Arsenault said Ren’s corporate structure lends itself to an efficient method of execution across all of its stores. “So when you’re talking to our marketing person, Larissa, we’re going to run a program, it’s going to be consistent across the chain. If you’re talking to Jason, our VP of merchandising, he’s going to do the buy-ins, we’re going to execute and you’re going to get support from marketing and you’re going to sell through and you’re going to be excited about it,” he said. “If you invest with us, you’re going to see results and it’s the mentality that it’s one check, and you’re not dealing with multiple decision makers, and I think that’s been something r Cont'd on Pg. 8

r From Pg. 6 that we’ve been able to develop in my 10 years and continually show growth. Anybody could do a buy-in and anybody could get a cheap deal, it’s the ability to execute.”

The tight battery of initiatives and innovation that has set Ren’s Pets on its course of success this year, including expanding infrastructure and embarking on partnerships like with DoorDash to become a leading supplier of raw foods, as well as continuing to build out its loyalty program, has not changed with the acquisition. Arsenault, who had served as President of Ren’s Pets for a decade before receiving a promotion to CEO by the Legault Group, credits the new owners for setting everyone’s mind at ease because at Ren’s Pets foundation, it is a place for people to learn and grow. “They were adamant about sending a message to our team and distributor partners that we aren’t going anywhere,” he said. “So they left the whole leadership team intact and they signed us up and retained us so they were understanding of the fact that anytime there is a transaction, everybody is like, ‘What’s happening? Is Scott sticking around? Where is Larissa going? Are they going to keep my boss? How does this affect me?’ By doing that, they were clearly saying to everybody it’s ‘business as usual.’”

Because with a decade of experience helming Ren’s Pets, Arsenault is fully invested it its success on multiple fronts. “What I’m most proud of here is we have multiple examples of people growing personally and professionally,” Arsenault continued. “I can’t count on my fingers how many people have started at $12 or $13 an hour as an associate and have worked their way through to team lead, assistant manager, manager and market manager. I’ve seen people move on to have office corporate jobs whether it’s in inventory, training or new store opening and construction; these are all people that started as associates. They’ve worked hard and have learned the business beside us and I’ve seen them buy houses, buy cars, have babies. We’ve experienced a lot of hardship. When you’re with people for 10 years you’re going to see some deaths whether it’s pets or family members. We’ve navigated through that really well and been a part of that for people. When I see people’s families growing and doing well personally as much as professionally, honestly, that makes me ecstatic.”

It’s a sentiment that the Legault Group can get behind. "It is very important for us to preserve the unique character of Ren's Pets and respect the original concept that has made the company's success and reputation for over 40 years," said Jules Legault. "This acquisition therefore represents collaboration and continuity for Ren's Pets, since the brand and all the personnel, including the current management team, will remain in place."

Arsenault shared a tangible example of how the parent company is weaving in the unique culture and history of Ren’s Pets, with a focus on the collective team, following a tour of Legault’s Montreal office. “If you want to talk about environment to work in or people that are conscious of creating something special, they probably had about 100 stand up desks, they had some super nice cappuccino machines, they had a yoga studio and a workout facility,” he said. “Little things that I was impressed with: when you went into a washroom where you work out, there were handicap accessible showers and they really had thought about everybody with watering stations, gender neutral washrooms. They’ve been very intentional about making this workplace safe. Electric charging stations for cars, bike racks, really open ceilings, live plants in the buildings. They’re growing and expanding and take this building and make it a place where people can be proud of and want to work and have different kinds of workspaces. Their emotional intelligence is high because when I got there, they asked us to name one of the board rooms, really close to where the founders’ rooms were, and they had named all of the board rooms. And they said ‘we want to name one after Ren’s so you pick a name.’”

Legault shares these values with Ren’s, said Arsenault, that if you take care of your team, they’ll take care of the customers. “There’s a lot of values about customer and community,” he said. “They’ve given away millions of dollars in support of pets and families in Quebec and so they’re very heavily invested in community, which we are. And then their customer is front and center with great products, clean stores. Those things are very similar. You’re finding a very similar business set to what we’ve got here at Ren’s. We’re going to operate separate and distinct but we’re going to take all of these synergies and best practices and apply them. You won’t see a name change. We’ll continue to grow in Canada; they’ll stay in Quebec, and it’s been great so far. It’s not a roll up by any means that you see sometimes where you start hacking and whacking. It’s a genuine growth story.”

One of the first endeavors for the Legault Group now, post-acquisition, is to open its Drummondville (Quebec) plant to further develop its manufacturing sources to protect product quality, production capacity and continue to grow, Legault said. “We will also put a lot of emphasis on ensuring the integration of Ren’s Pets. We want to do every step right so that the synergy between the two companies is well established and they can benefit from each other’s successes. This will always be done by taking a rational approach, conducted with respect and rigor.”

And Arsenault is keeping his eye on the ball as well with a number of planned store openings. “We have a couple of exciting opportunities still to open up within this year and then signing leases for next year. Doing supply, making sure we have a lot of inventory. Finishing stores we just opened and are about to open and then really planning for the stores that open next year. We’ll probably do another seven stores next year on top of our 38. We’ll be 48 to 50 by the end of next year.”

There’s not enough Ren’s Pets out there, he said. “We have a great program to be signing people up pre-opening and it’s been a super success to be in a new market. It just gives us a lot of encouragement and gives us fire to keep doing more. We think the mission we’re on for pet’s best life is being served through Ren’s, and we just want to do more of that.”