Costa Rica’s Highway 32 had a deadly 30-kilometre stretch, claiming at least one life a week. The main highway between Santa Cruz and many of the country’s fruit farms weaves through the rainforest and is often covered in fog, making the traffic lines hard to see. Even in optimal conditions, cars were tempted to pass slower-moving fruit trucks, often leading to head-on collisions on the curvy, narrow highway.
It was an issue for years until the Costa Rican government hired a Canadian company to install a product that stopped the accidents in their tracks. Trafic Innovation , of Saint-Eustache, Que., has been working on traffic products since 1999, and its latest releases are flexible road delineator posts that keep vehicles in their own lanes. The posts were installed on Highway 32 on June 9, and since that time there hasn’t been a single accident, let alone fatality.
The sale has meant big things for Trafic Innovation, which has been on the regional news several times a day since installing the posts. The company is now in talks with governments in Peru, Ecuador, Colombia, Panama and Dominican Republic.
“In Central and South America, the roads are narrow,” said Trafic Innovation CEO Robert Laforce. “The delineators help keep the traffic in its own line, which is why it’s been so successful in Costa Rica.”
Trafic Innovation set for more growth
Trafic Innovation can see future possibilities to export in other countries and even continents. “We’re on the news all the time in Costa Rica, and that is going to promote our product very well with the surrounding countries, such as Honduras, Guatemala and Panama,” Laforce said. “In fact, we’re now creating specific marketing literature for the Latin market.”
The company already has a good business selling its DEFLEX products, which range from flexible green posts for bike paths to orange traffic delineators for construction zones, in Quebec and Eastern Canada.
The delineators, which in Costa Rica act as a three-dimensional extension of the lines on roads and highways, are made of a blend of treated polymers that are resistant to UV rays and harsh weather. And in the rare event that the delineators are run over, they bounce back easily and pose no damage to vehicles, unlike the hard metal signs they often replace. In fact, replacing hard metal construction signs is what inspired Laforce to go into business in the first place.
“We made the first big barrel channelizers (large cones) that you see all over the place in Quebec,” Laforce said. “That was 14 years ago.”
And after success with those, his two designers and an R&D engineer kept innovating, in the spirit of the company name.
The latest business expansion outside of Canada is due, in part, to help from Export Development Canada (EDC), which insured the company’s receivables and is providing guarantees of purchase orders with its bank. For example, it has guaranteed loans for purchase orders of $150,000 for another client in Costa Rica and $500,000 for an order in Colombia.
Without EDC, Laforce said he wasn’t sure what they would have done. “For us, this is a big plus,” he said. “Our bank would not back us up with export contracts, so this guarantee is very helpful. Without the guarantee, I might have gambled, but there’s no way we could have sold as much as we can now. We are no longer worried about selling to those countries, because our bank will cover 90 per cent of our receivables.”
EDC saw Trafic Innovation as a good bet. The company has a seasonal domestic business, which drains its funds in the summer, so it needed financing for its larger export contracts that also came along during the high-demand summer months.
“We guaranteed 100 per cent of an increase on an operating line of credit from their bank to allow them to draw additional funds to finance their larger export purchase orders,” said EDC account manager Jérome Brière. “We found a way for the bank to extend 30 per cent of the value of the work in progress into their borrowing base, which was a definite boon for the company.”
Brière said this is a great example of a solution where EDC, through its export guarantee program, and Banque Nationale du Canada, Trafic Innovation’s bank, created a solution to meet the exporter’s needs, while staying within an acceptable level of risk.