Dear Customer

If a company presently disburses (hundreds of) thousands of dollars in safety foot wear subsidies using the employee reimbursement method, the benefits of this type of program (ease of operation, employee convenience and flexibility) may not be working in that company's best interest. That company:

-May not be getting the GST refund (7%) since purchase/tax not paid by employer

-Has no real control over the quality or appropriateness of the footwear purchase

-Has no real control over potential subsidy leakage (i.e.: goods other than safety footwear under a recorded safety footwear purchase)

-Lacks a secure argument if an accident action requires a `due diligence' defense

It is difficult to move employees to an exclusive supplier from a freedom of choice subsidy program, as they feel a privilege (or bonus) is being withdrawn. However:

-Apply some of the direct tax savings to effective promotion of a replacement program, without affecting overall program budget. The key word is "effective"

-Supplier monitoring/reporting on a `single billing' payroll deduction program could save potential administrative expense-practical with an exclusive supplier.

-An exclusive supplier will be motivated to operate in partner fashion, providing ongoing information and detail like an in-house administrative team.

- An exclusive supplier should be able to deliver price consistency, quality, selection and value through ongoing pricing reviews and corporate selections.

-An exclusive supplier must be able to provide the service coverage required for effective program operation.

 Coverage: Iseco is Canada's largest safety footwear specialist, with 32 mobile fitting units and 18 retail outlets strategically located in every Province across Canada except Newfoundland.

Flexibility: Iseco can design a cost effective program to meet YOUR COMPANY requirements, from pre-scheduled mobile service visits to a drop shipment arrangement.

Invoicing/Reporting: We are familiar with payroll programs, and find the following billing options helpful: a) The entire amount can be billed to YOUR COMPANY, or, b) Just the Subsidy amount billed, and any cash balance collected at the time of the transaction.

We can provide summary billing reports by location, employee and purchase date to assist your internal product tracking and analysis. (These cannot be done with a cash only system.)

Tax Exemption: Our reports also simplify capture of tax remission and exemption entitlements, and can be provided monthly, quarterly or semi-annually.

Price/Value: We provide price lists and catalogues which indicate the product selection available to YOUR COMPANY. This pricing provides the broadest possible selection to maximize the value of your subsidy; to reduce the employee's cash supplements at time of fitting. This could include other PPE, plant safety products, and work wear also. Additional price breaks can be negotiated for an exclusive program.

We try to establish and commit to specific volume based prices each year for a period of 12 months on regular stock, and we would make the effort to ensure YOUR COMPANY employees

Can benefit from end-of-line product clearance pricing.

Selection: At YOUR Company's $150.00 annual subsidy level, all job types could have a good choice of safety footwear. Iseco would work with you to establish recommended styles for each category.

CSA Standards: Iseco, as an active participant, is fully conversant with CSA standards. You will note in our catalogue that the majority of offerings meet or exceed Group 1 or 2 classification. Some products not indicated as classified are in the formal process of approval. We would review these products with you at product selection time.

Availability: Iseco maintains an average on hand stock of some 130,000 pairs, 60,000 in our Mississauga warehouse and the balance in position in our mobiles and stores. Each mobile carries over 1000 pairs, each store over 1500. Our non-footwear stocking policy is similar.

Ownership and Souring: ISECO is 100% Canadian owned and operated, serving industry in Canada for over 60 years.

We work directly with all the major Canadian manufacturers. We are proud to say some 70% of our footwear lineup remain Canadian made, in spite of a declining number of Manufacturers, and encourage our customers to consider Canadian product.

ISECO Safety Shoes can offer all of the above. Our cross-Canada coverage and ongoing market leadership has been regularly challenged since 1938. We have had to remain consistently price competitive over the long run while maintaining our quality standards, and will continue to do so. We have strengthened our customer services with (no charge) information circulars and consultation, while adding convenience items such as safety products and workwear to our product line. Our ability to grow and change with our customers' needs confirms our responsiveness.

If you have any questions concerning payroll deduction or service I will be glad to answer them. Please advise me at your earliest convenience if you would like an account set up.

Regards