Buoyed by increasing revenues, Canadian SMBs want to invest in technology and people to drive growth.
Key Findings from Sage’s 2023 Small Business Big Opportunity Global Survey:
- The majority (72%) of Canadian SMBs report confidence in their current business success, compared to 63% in 2022.
- 50% are experiencing a revenue increase, with a quarter (24%) seeing more than 10% growth.
- 50% are planning to increase their investment in technology and 42% expect to hire more people in 2023.
- Rising costs remain a challenge for three quarters and are above the global average.
TORONTO, May 08, 2023 (GLOBE NEWSWIRE) — Sage, the leader in accounting, financial, HR, and payroll technology for small and mid-sized businesses (SMBs), today unveiled the results from its annual global survey Small Business, Big Opportunity of approximately 12,000 SMB business leaders worldwide; including 1,200 in Canada. The new study finds that the majority of Canadian SMBs (72%) are confident in their current business1 success, up from 63% in 2022.
The report found that increased revenue is driving Canadians’ confidence, as half (50%) of SMBs have seen an increase in 2023, with nearly a quarter (24%) experiencing more than 10% growth. Cash flow, the lifeline of a small business, is also looking positive, with only 17% stating this as a significant barrier compared to 23% globally.
Increased customer base (38%) also contributed to SMBs’ positive outlook, followed closely by quality of staff (37%), working more efficiently (36%) and adopting new technology (30%). With a buoyant outlook, 50% are planning to increase their investment in technology and 42% expect to hire more people in 2023. However, the study also found that 75% of Canadian SMBs are concerned with rising costs, compared to their global counterparts ( 65%).
“While Canadian businesses are bouncing back from the pandemic, there are a new set of economic challenges that many are facing,” said Mark Hickman, Managing Director of Sage in Canada. “Collectively business leaders and the government share a responsibility to support SMBs that have an ambition to invest back in their business. That includes finding solutions and incentives to enable them to secure the right people and the right technologies to drive productivity and achieve sustainable growth.”
1 Provincially, SMBs in Alberta (78%) and Ontario (76%) have a higher confidence than the Canadian average, with New Brunswick (67%), Quebec (65%) and British Columbia (50%) SMBs slightly below average.
The one-two punch of rising costs and battle for talent
The rising costs of doing business in Canada are above global averages. Canadian SMBs are impacted by rising salaries (42% vs. 38% globally), office expenses (31% vs. 26% globally) and marketing and advertising expenses (17% vs. 13% globally).
The talent shortage challenge is evolving and uneven across Canada and sectors. Overall, 66% are satisfied with their current staffing levels, lower than the global average (70%). However, some sectors in the knowledge economy are experiencing more acute challenges, such as financial services (61%) and professional services (58%) industries, both of which are lower than the national rate of staffing level satisfaction. Provincially, only 17% of SMBs in Ontario and 19% in Quebec say they are very satisfied with their staffing levels.
Canadian SMBs trail behind their global counterparts in closing the talent gap, which impedes the country’s competitiveness. Only 27% of Canadian SMBs say they are doing well at hiring new talent – compared to 33% globally and 43% in the US.
Building efficiencies to gain resilience
The study found that Canadian SMBs are looking to cut costs and operate more efficiently to overcome their challenges. 38% of Canadian SMBs, the joint highest globally, say that cutting costs has helped their business succeed in the past year, compared with 33% globally and 30% in the US.
The adoption of technology is also a crucial driver for SMBs to adapt and increase productivity. The majority of Canadian SMBs (53%) are adopting technologies to save time on key processes; followed by streamlining their tech-stack for solutions to work more seamlessly together (36%), cutting costs (36%) and increasing productivity (31%).
Almost half of SMBs in Canada (49%) say they will increase their investment in technology over the next 12 months with emerging technologies such as 5G (29%), AI (24%) and the Metaverse (16%) being the most likely to be adopted by them.
While these measures are important and good business discipline, SMBs are demanding governments to help support the creation and growth of small businesses. 36% of Canadian SMBs identified “tax relief” as the preferred solution.
Notes to editors
Sage, in partnership with Strand Partners, conducted an online survey of 11,986 SMB business leaders in February 2023. The markets included as part of this study are Canada, France, Germany, Ireland, Portugal, Spain, South Africa, the UK and the US. In each market, except the US (where a specific sample was included for those employing 250-500 people due to a different official definition of SMB), decision makers at businesses employing fewer than 250 people were targeted.
To download the full research report, https://www.sage.com/en-gb/company/digital-newsroom/2023/05/05/small-business-big-opportunity
|Small Business Big Opportunity YoY Comparisons – Canada|
|% SMBs expecting revenue to stay the same or increase next year||56||%||73||%||17||%|
|% SMBs experienced increased costs during the last 12 months||30||%||75||%||45||%|
|% SMBs confident about business success right now||63||%||72||%||9||%|
|% SMBs satisfied with their productivity level||66||%||79||%||13||%|
|% SMBs expecting to increase investment in tech over the next 12 months||38||%||49||%||11||%|
|Average SMB % predicted change in investment in tech over next 12 months||14||%||15||%||1||%|
The sample includes a diverse range of SMB decision makers globally, with the sample size for each market being as follows:
About Sage Group
Sage exists to knock down barriers so everyone can thrive, starting with the millions of small and mid-sized businesses served by us, our partners and accountants. Customers trust our finance, HR and payroll software to make work and money flow. By digitizing business processes and relationships with customers, suppliers, employees, banks and governments, our digital network connects SMBs, removing friction and delivering insights. Knocking down barriers also means we use our time, technology and experience to tackle digital inequality, economic inequality and the climate crisis.
PR Manager, Canada