THUNDER BAY – COVID-19 has changed how many people do business, as well as changing how many people live their lives, or work. The pandemic has presented problems.
Entrepreneurs see problems as opportunities. That is fueling some significant changes in the business cycle.
Most small and mid-sized enterprises (SMEs) are looking ahead and taking action to prepare for the future despite COVID-19, according to BDC’s study, “The Response: How Entrepreneurs Are Adapting to the Pandemic“. The study identifies five priorities for entrepreneurs as they plan for the future, as well as how the pandemic has changed Canadians’ habits.
“Canadian entrepreneurs are looking to the future and showing ingenuity in adapting to the challenges of our new business environment,” says Pierre Cléroux, BDC’s Vice President, Research and Chief Economist. “Our findings show that adopting business practices that consider new consumer and work trends can put SMEs back on the track to prosperity. As a second wave looms ahead, the recovery may be choppy, but we are confident in the ability of SMEs to adapt as the situation evolves.”
Planning the future: Five priorities for entrepreneurs
The study offers practical advice for business owners who are relaunching their business and finds entrepreneurs are adapting to the health crisis with the following five priorities in mind:
- Putting finances in order (39%) by reducing operating costs, controlling cash flow and setting up a contingency plan;
- Taking advantage of technology (27%) to stay competitive;
- Focusing on telework (25%) to allow physical distancing, but also to respond to employee requests; According to research by marketing and polling firm Léger, 80% of workers who have worked remotely during the lockdown plan to continue practicing it;
- Selling online (24%) and focusing on several areas, such as website improvement, social media activity and targeted promotional campaigns;
- Reviving growth (23%) by diversifying clientele and offering to ensure businesses stay robust. Moreover, entrepreneurs who are confident they will weather the crisis plan to change their supply chains (11%), whereas 10% of SME executives say the COVID crisis has caused them to increase the number of their local suppliers.
A new business environment
The pandemic has changed Canadians’ habits:
- 83% are willing to pay more for local products;
- 56% of consumers have made more online purchases since the start of the crisis;
- 50% are concerned about the health impacts of the products they consider buying;
- 25% want to reduce personal consumption.
Some business trends are new, while others have accelerated, such as increasing investments in technology. “While the situation remains uncertain, Canada’s entrepreneurs are in solution mode. Adapting to this new environment could be key for smaller businesses to prosper in years to come,” Cléroux adds.
BDC’s study is based on literature published since the pandemic began in March, as well as interviews with academic, consulting, and marketing research experts. The data presented were derived from two surveys conducted by BDC among 1,000 Canadian SME leaders and 2,000 consumers in May and June of 2020.
The report is published as part of this year’s edition of BDC Small Business Week™ (SBW) under the theme, “Forging the way forward”. Taking place from October 18 to 25, SBW is an annual celebration of entrepreneurship that BDC has organized for over 40 years. This year’s edition will recognize entrepreneurial resilience and innovation in the aftermath of the COVID-19 pandemic and ensuing lockdowns.
Stepping up for Canadian entrepreneurs facing COVID-19 challenges
BDC was among the first organizations to deploy additional measures to support entrepreneurs through the current health crisis, providing more access to capital, including working capital loans, flexible terms and payment postponements, bridge financing for venture-backed companies and several tools deployed by the Advisory Services team. The investments BDC has been making over the past few years in digital solutions were a key factor in helping the bank respond to a high volume of financing requests with additional speed. BDC pivoted operations to provide additional liquidity and advice for entrepreneurs. Along with participating financial institutions, BDC’s direct COVID support lending has totaled $2.4B. For information on available BDC support, visit bdc.ca\coronavirus.
BDC is the bank for Canadian entrepreneurs. It provides access to financing, as well as advisory services to help Canadian businesses grow and succeed. Its investment arm, BDC Capital, offers a wide range of risk capital solutions. For more than 75 years, BDC’s only purpose has been to support entrepreneurs in all industries and at all stages of growth. For more information and to consult more than 1,000 free tools, articles and entrepreneurs’ stories, visit bdc.ca.