Canadian small businesses have a long, slow road to economic recovery ahead, according to the Canadian Federation of Independent Business.
53 percent of Canadian small businesses will need more than six months to return to normal profitability.
As of July 6, preliminary results from the CFIB’s survey suggest 53 percent of Canadian small businesses will need more than six months to return to normal profitability due to COVID-19.
The survey, which began July 3 as part of the CFIB’s #SmallBusinessEveryDay campaign, included responses from 3,816 small business owners across Canada.
“Small business recovery is going to be a long, tough road,” said Laura Jones, CFIB’s executive VP. “Governments can and should do more, but ultimately businesses need sales to transition off subsidies and survive.”
According to Jones, customer support is critical to the survival of Canadian small businesses.
“Collectively, individual actions like trying a local business for the first time, giving your hairdresser a bigger tip or buying a new swimsuit from a local store can make a big difference,” Jones added.
Nearly one in three (30 percent of) Canadian small businesses expect it will take more than a year, while five percent fear they will never return to normal profitability.
CFIB launched its #SmallBusinessEveryDay campaign last week. The non-profit organization represents the interests of over 110,000 Canadian owners of small and mid-sized business to all levels of government.
According to CFIB, the main indicators of small business recovery measured by the survey—the proportion of small businesses open, fully staffed, and experiencing normal sales—have not moved significantly since the first week of July, when they demonstrated some improvement. Across Canada, 57 percent of small businesses are fully open, 34 percent are fully staffed. Twenty four percent report experiencing normal sales.
Small business owners reported they are most worried about the overall economy, the fall in consumer spending associated with COVID-19, business cash flow, and debt.
Compared to other provinces, Ontario small businesses are currently faring the worst: 49 percent are fully open, 31 percent are at normal staffing, and 20 percent have at least normal revenues. Ontario has the highest concentration of small businesses in Canada.
In terms of its proportion of small businesses open, Saskatchewan leads the country at 71 percent, with Manitoba, Quebec, New Brunswick, and Nova Scotia close behind at 68 percent.
Profitability-wise, small businesses in Prince Edward Island, the first province to reopen, are doing the best, with 34 percent experiencing normal revenues.
Part of recovery efforts should be getting small businesses online ASAP. It’s critical, not only for the recovery of each business but also for the Canadian economy. Had the country not lagged so far behind in adopting and facilitating online business, we’d be in much better shape to cope. Let’s not make that mistake again.
Plus, Canadian small businesses need help to compete at a global level online, which means removing barriers like outrageous shipping costs and assistance with digital transformation. Help small businesses to help themselves and they’ll get back to being the backbone of the Canadian economy.