From creating jobs to generating economic growth, small businesses are doing big things for Canada. Whether you’re an aspiring entrepreneur, a small business owner or one of their tens of millions of customers, here are five facts we think everyone should know about Canadian small businesses.
You might be surprised to learn that 98.2 per cent of businesses operating in Canada are small businesses. However, it’s a lot less shocking when you think about the businesses you most frequent: the coffee shop, the restaurant, the spa, the dentist, the drycleaner, the bakery, the boutique … you get the picture. Small businesses are all around you.
Small businesses are an important source of Canadian innovation, accounting for 31 per cent of research and development (R&D) expenditure. Innovation is not only driven by big-enterprise investments in research centres, but also by the everyday use of technology to improve products and processes. A recent study found that more than half of Canadian small businesses adopt technology faster than their large counterparts. Why? Small firms are more nimble and better able to implement changes, including adopting innovative technology to grow their business.
When it comes to small businesses as employers, there’s nothing small about the number of jobs they create. In fact, these organizations are considered the backbone of our economy because they produce more jobs than any other type of business in Canada.
If you’re not impressed with Canada’s small business community by now, perhaps this fact will seal the deal. Small businesses account for almost 30 per cent of Canada’s GDP, a key measure of our economic output. What’s more? Small businesses are responsible for about 24 per cent of the total value of Canada’s exports, which is extremely beneficial for our economy and trade relationships.
Running a small business isn’t easy. Of the 150,000 new small businesses that launch each year, only 51 per cent survive past their five year anniversary. That being said, Canada is a great place to be an entrepreneur. In fact, the World Bank’s Ease of Doing Business Index ranked our country as the second best place in the world to launch a company.
Why the high failure rate then? Most small business owners have passion, an idea and a solid business plan. But, even with all of these elements in place, many small business owners face unexpected financial challenges in the first few years of operating a business. That’s where we’d like to step in.
The opportunity ahead for Canadian small businesses is incredible, which is why we’re so passionate about supporting entrepreneurs and created the Small Business Challenge contest – now in its fifth year.
From now until May 25, we’re asking small businesses to submit their greatest challenge and explain how $100,000 would help them overcome it. Sound like a contest for you or someone you know? Click here for more information.