Calgary Chamber calls for relief during small business week
Calgary, October 20, 2023 – With small business week wrapping up, the Calgary Chamber reiterates that small businesses are the engine of our city, province and country, with 97.9% of businesses considered small across the country. Ensuring their continued growth and prosperity is critical to everyone’s success.
“Small Business Week is an opportune time to promote – and even more importantly, celebrate – the businesses and the people behind them, who help power our economy,” said Deborah Yedlin, President and CEO of the Calgary Chamber of Commerce. “SMEs comprise a substantial portion of our workforce, stimulating local job creation and employment opportunities, lending to our city’s – and province’s economic growth and resiliency.”
Recent Q3 survey results, conducted by Statistics Canada in collaboration with the Canadian Chamber of Commerce, found that Calgary small businesses are less optimistic about the year ahead relative to larger companies. While a number of pressures are contributing to this sentiment, inflation, rising costs and supply chain constrains are the leading factors. While Small Business Week is a time to celebrate, it is also an opportunity to bring business issues to the forefront.
Smaller businesses – with one to four employees – are comparatively more concerned with inflationary impacts than larger firms, with 61.4 per cent of respondents indicating challenges. Smaller businesses are disproportionately impacted by inflation with many small businesses having less capacity to respond to a higher cost environment. 50 per cent of businesses with 100 employees or less expect operating expenses to increase over the next three months, yet only 12.5 per cent expect profitability to increase – ultimately reducing profit margins and impacting the ability to raise prices.
Smaller businesses are also struggling with both debt serving costs and with maintaining sufficient cashflow. According to the Q3 results, businesses with less than 20 employees are eight per cent more concerned than larger businesses with rising interest rates and debt servicing. During the pandemic, nearly 900,000 individual businesses needed government support to remain afloat, with the vast majority being small business. Paying off these loans, in addition to other debts, in a high interest rate environment, is exacerbating the financial struggles for many businesses. As a result of these constraints, smaller businesses remain exposed in the sustained inflationary environment. Smaller firms (29.7%) are also more concerned with rising costs in real estate, leasing and property taxes and are twice as likely to struggle compared to larger businesses (11.6%) – which is contributing to their overall concern with rising costs.
Another challenge posed to smaller businesses is supply chain constraints. Businesses with 5-19 employees are struggling the most with acquiring inputs and products both within Canada (22.1%) and abroad (32.2%). This is amplified in concerns around supply chains, with larger firms expecting supply chains to be resolved at a faster pace than small and mid-sized business.
Despite these numbers, there is reason for optimism in Calgary. In 2022, Calgary ranked fourth in investment attraction across Canada, and has had record population growth with an average of 62 new residents a day being added to the City. Governments, at all levels, must come to the table to support businesses struggling with costs. Ensuring red tape is reduced, taxes are competitive, and financial supports are in place are all critical to the long-term prosperity of small business.
ABOUT THE CALGARY CHAMBER OF COMMERCE
The Calgary Chamber exists to help businesses reach their potential. As the convenor and catalyst for a vibrant, inclusive and prosperous business community, the Chamber works to build strength and resilience among its members and position Calgary as a magnet for talent, diversification and opportunity. As an independent, non-profit, non-partisan organization founded in 1891, we build on our history to serve and advocate for businesses of all sizes, in all sectors across the city.