Winterwear wizard Dani Reiss, Photograph by Markian Lozowchuk Winterwear wizard Dani Reiss, Photograph by Markian Lozowchuk

Last December, Larry Rosen found himself in an unusual position. The president of top-shelf clothing retailer Harry Rosen Inc. had to beg a supplier for more merchandise: winter parkas. But not just any parkas; these were the high-end, high-puff down-filled coats produced by Toronto-based Canada Goose Inc.

Rosen is not the sort of retailer who often bows and scrapes for merchandise, but his stores had burned through their initial autumn order well before Thanksgiving, and customers were clamouring for more. But Canada Goose president and CEO Dani Reiss, who generally turns aside special orders because retailer demand is so high, made an exception and anted up 600 parkas for the Boxing Day sale, with a provision: no markdowns. (Canada Goose parkas start at $600.) "By the end of that day," recalls Rosen, "we sold every single one of those coats at the regular price, on the biggest sale day of the year."

Canadians, it seems, can't get enough of Canada Goose. Nor can growing numbers of consumers worldwide, to whom the Arctic map patch adorning all Canada Goose products is becoming iconic. Reiss appears to be doing for winter what Roots co-founders Michael Budman and Don Green had done for summer a generation ago—weaving domestic materials (down and leather, respectively), domestic manufacturing and evocative Canadian symbols into a brand with global cachet and legions of celebrity endorsements. As Reiss says, "People hate being cold." And who should know more about keeping out the cold than a Canadian?

Now, Canada Goose is facing the big question that confronts other entrepreneurial firms as they rocket up a fearsome growth curve: how will it keep up with ever expanding waves of consumer demand without compromising quality, undermining the brand promise or running out of runway?

In just a decade, Canada Goose has seen its annual revenue grow by 3,000%; sales are expected to top $100 million this fall as the company builds market share in Europe, the U.S. and Asia. In another measure of the firm's popularity, company officials dedicate plenty of attention to the burgeoning Canada Goose counterfeit market.

In Canada alone, which still accounts for a full third of revenue, many retailers say they can't order enough Canada Goose gear to keep up with demand despite the high price point. "It's our No. 1 selling brand over the wintertime," says Kris Choi, manager of Vancouver's Alpine Starts Outfitters, adding that the store has been doubling its Canada Goose order each year.

I realized people had an emotional response to 'Made in Canada,'" says Reiss. "Owning one of these jackets was like trying on a piece of Canada

Yet, Reiss has been careful to keep the market slightly undersupplied. And because he is adamant that the brand promise is indistinguishable from the made-in-Canada label, Reiss has opted not to offshore production, instead keeping the company's manufacturing operations domestic and modestly scaled. Canada Goose operates 20 Canadian factories with a total of 1,000 employees, and sources all its down from Western Canada poultry farms. The bottom line: Reiss can dictate terms, including consistent rack prices.

While the company is still on a steep upward growth trajectory and is in the midst of a determined push to win new, brand-conscious consumers in China, it faces tough questions about the future. By maintaining its current position as an iconic niche brand, Canada Goose could avoid the risks of product diversification while also limiting its growth potential and developing no hedge against increasing competition from the likes of France's Moncler and other high-end down gear-makers. By following Roots' lead—diversifying offerings, extending the brand to licensed merchandise and sourcing some products offshore—Canada Goose unlocks huge growth potential but risks diluting the brand that has gotten the firm to where it is today. Either way, tens—and maybe hundreds—of millions of dollars are at stake.

Reiss has his reasons for staying the course. "We are not a mass brand," he insists. "The strongest brands in the world are true to what they are." Indeed, he likes to think of Canada Goose as a kind of anti-brand because it hasn't succumbed to the commoditization that can swamp the original promise. "A lot of brands have become fake," Reiss says, citing examples such as Victorinox Swiss Army, which has affixed its distinctive red cross on commodity items such as knapsacks. Reiss has far more time for undiluted brands such as Land Rover or Rolex. "You can't make a Swiss watch in China," he says. "We're trying to be the Swiss watch of Canada."

Brynn Winegard, professor of marketing and entrepreneurship at Ryerson University's Ted Rogers School of Management, says Canada Goose has been "very smart" to keep the market slightly underserved and avoid "training" customers to look for discounted items in outlet stores. "They will never have a problem with surplus product in the marketplace," she says. To maintain healthy growth, Winegard feels the company can continue to push into new geographical markets and diversify its product line into "peripheral" outdoor gear. In fact, in recent years, Canada Goose has introduced new lightweight down vests for the so called "shoulder" seasons.

Making parkas, circa 1970s

Making parkas, circa 1970s

Brand extension is a useful growth strategy, but it comes with its own risks, notes Alan Middleton, professor of marketing at York University's Schulich School of Business. "The more you water down what your core appeal is, the more you're going to become like a lot of other people."

Middleton also notes that manufacturers like Canada Goose cannot simply wish away supply-chain issues as they grow internationally. He points out that brands like Tilley Hats initially stuck to a made-in-Canada approach but were forced to go offshore when demand grew too great. In the case of Canada Goose, for which the made-in-Canada promise is woven right into the brand, Middleton says, Reiss could take an alternative approach, pressing hard to drive down production costs with new technology as a means of retaining a Canadian manufacturing presence with enough capacity and flexibility to keep up with international orders. "That constant push for innovation becomes critical."

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