2019-12-10 08:55:39 News English https://quickbooks.intuit.com/ca/resources/ca_qrc/uploads/2019/12/BR300352.jpg https://quickbooks.intuit.com/ca/resources/news/canadian-small-businesses-remain-optimistic-in-the-midst-of-economic-uncertainty/ Canadian small businesses remain optimistic in the midst of economic uncertainty

Canadian small businesses remain optimistic in the midst of economic uncertainty

4 min read

  • Over 4 in 5 (83 per cent) of Canadian small business owners plan to hire new employees in the next 2 years
  • However, 85 per cent of this group feel held back by a lack of knowledge in the hiring process and payroll emerges as a surprise pain-point for 44 per cent of Canadian small businesses

 

As 2020 approaches Canada’s economy continues to face speculation of major challenges and barriers. However, new research from Intuit QuickBooks Canada has shown that Canadian small businesses – a vital pillar in the country’s economy – are optimistic in the face of this uncertainty, and are actively looking to continue growing their businesses, with 83 per cent planning to grow their business by hiring new employees in the next two years.

As Canada’s largest small business ecosystem, Intuit QuickBooks Canada commissioned this survey to provide insight into the barriers and pain points that small businesses are most commonly facing. As a major contributor to economic growth in Canada – with small businesses making up 98 per cent of employers in Canada – this survey aims to help inform how we can continue to foster the economic growth of small businesses and in turn, Canada. Some of the key findings have been detailed below:

Small businesses owners don’t have time to look beyond their day-to-day

Canadian small business owners wish they could eliminate challenges related to growing the customer base (33 per cent), compliance with government regulations (29 per cent), managing the business’ provincial and/or federal tax requirements (29 per cent), maintaining cash flow (29 per cent) and building capital for the business (28 per cent).

Small businesses come in all shapes and sizes – and whilst each business is unique, there are a number of common issues that many small business owners face. Managing finances is one of these, with our report showing that nearly half (45 per cent) of small business owners have difficulty with managing cash flow and a similar amount (44 per cent) admit to having difficulty with payroll.

When looking more closely at payroll, nearly half (45 per cent) say that it is keeping them up at night. For those who manage their own payroll, close to half (46 per cent) have experienced payroll issues and when looking at those who have experienced issues:

  • Over half have had to pay themselves late so they could pay their employees on time (53 per cent);
  • 1 in 3 have had difficulties tracking employee hours (33 per cent);
  • 1 in 4 have had to move funds from other areas of the business to cover payroll (25 per cent), and
  • 1 in 10 have had an employee leave because of a pay dispute (9 per cent).

 There’s a gap between growth potential and knowing where to start.

Over 2 in 5 Canadian small business owners who plan to hire feel unprepared for their business to grow (43 per cent)

Despite the barriers this report identified, we know that Canadian small business owners are optimistic about the future and have plans to grow, however, just under half (43 per cent) don’t feel completely prepared for their business to grow, and nearly 2 in 3 (60 per cent) don’t feel completely prepared to manage the hiring process.

Barriers for growth begin right at hiring, with over 4 in 5 feeling held back by their knowledge of the process (81 per cent). In fact, 3 in 5 Canadian small business owners struggle with their lack of knowledge about sourcing talent (62 per cent), and almost half feel held back from a lack of knowledge about interviewing (43 per cent).

Compensation is also proving to cause challenges. Almost 3 in 5 (56 per cent) Canadian small business owners planning to hire are unsure about how to determine appropriate compensation and a similar amount (54 per cent) don’t know how to draft an employee contract. Also contributing to this, 54 per cent also say they feel held back by a lack of knowledge about setting up/running their payroll.

Digital solutions key to reducing barriers for small businesses

At QuickBooks Connect Toronto this year, QuickBooks Canada announced a range of new product innovations, many of which provided small business owners with the ability to embrace AI and technology-driven tools and capabilities. These upgrades and innovations will allow small businesses to get smarter about where they are spending their time and money, and help connect them to the tools and resources they need to succeed.

For example, in our survey, small businesses who use payroll software say they continue to use it because of the ease of use (48 per cent) and it does the job well (47 per cent). Peace of mind also rated extremely highly, with almost all who use payroll software saying that they feel confident their payroll is set up correctly (98 per cent).

To learn more about recent payroll product updates we have announced, click here to download a comprehensive payroll e-book.

To learn more about other announcements from QuickBooks Connect Toronto, click here.

About the survey

This poll was conducted by Edelman in partnership with Logit Group on behalf of Intuit QuickBooks Canada between October 15 and October 22, 2019 among a sample of 1,500 small business owners with 1-99 employees, and 1,500 small business owners with no employees. The interviews were conducted online and respondents were sourced using Logit Group’s online panel.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

Related Articles

Canadian small business grants: Tools and tips to get funding

The best resources for small business grants in 2019 Canada GrantWatch A…

Read more

A guide to the top Canadian small business loans

Canadian small business loans: Which is right for me? You’ve been preparing…

Read more

How to register as self-employed business owner

By 2020, 45% of the Canadian workforce will be made up of…

Read more