Researchers Find that Canadian SMBs are Optimistic About The Future Of Their Business.
According to Scotiabank’s annual Path to Impact Report, most small Canadian businesses are doing better than they were two years ago. However, many are concerned about inflation, rising interest rates, supply chain issues and labour shortages.
Between August 26th 2022, and September 1st 2022, 806 financial decision-makers at Canadian businesses earning between C$50,000 to C$5,000,000 were surveyed.
Zoho, a cloud and SaaS application provider, based in India, sees the same optimism among SMBs as its SMB Outlook survey.
Zoho reached out to 1526 people in August 2022 for their survey, which included managers and business leaders at large and small enterprises.
According to Zoho’s survey, 73% of Canadian SMBs are optimistic about the future. At least 40% of respondents said they anticipate 1-10% growth over the next six months.
The survey results also showed that over 80 per cent of Scotiabank respondents believe they are better prepared to deal with another pandemic and a potential recession than they were two years ago.
Marvin Cruz, director for research at the Toronto-based Canadian Federation for Independent Business (CFIB), said that the Scotiabank report shows that businesses are doing much better than they were when owners had to close their businesses and their confidence was lower. He said that only 70% of companies had been open to business two years ago at the beginning of the pandemic and that only 30% had recovered average revenues by September 2020.
“What is missing is the opinions of those who were really at the edge of the ones that made it. The reality is that although they (the businesses surveyed) are doing well or not, it’s still difficult for small business owners. Cruz stated that our data shows that 56% of these businesses are still below their normal sales and 64% deal with a debt pandemic.”
Scotiabank’s report reiterates these worries. Businesses said they are affected by rising interest rates (24%) and inflation (34%).
Zoho’s survey shows that at least 23% of businesses affected by inflation said they raised prices by 1-5 per cent.
Although over 45 per cent of Zoho survey respondents said they had difficulty hiring the right talent for their company, their staffing plans remain solid, with 43.4 per cent planning to hire and only 5.5% anticipating layoffs.
“SMBs are the engine of this country’s economy, and the fact that SMB leaders are facing today’s challenges like inflation, hiring, retention, return to work models, and more while remaining optimistic about business growth means that Canada should do well in a possible recession,” Chandrashekar LSP (Zoho Canada’s managing Director) said.
The bank suggests the following, even though 65% of Scotiabank survey respondents said they need financial assistance in the future.
Consider financing options. This could include increasing your credit line, applying for government-based assistance, and looking into additional loan programs.
Streamline your business and cut costs wherever you can. Find and capitalize on efficiencies within your organization’s operations.
Prepare a contingency plan to deal with any changes in the business environment. Create a repayment plan if you are eligible for relief loans or other government assistance.
Develop a robust digital presence, prioritize hybrid work options, source labour talent, and market your company to new customers
Revisit your existing products and see if you can make any improvements. Pay attention to the latest trends and stay up-to-date with current news.