Canadian businesses worry about surviving pandemic’s second wave: survey

Nearly a third (31 per cent) of small- and medium-sized Canadian business owners worry they don’t have enough money or access to credit to survive another significant economic downturn caused by the second wave of the COVID-19 pandemic, according to a new survey.

The survey of 500 small- and medium-sized Canadian companies, conducted by consulting firm KPMG in mid-September, also shows that over half of these enterprises are focusing on surviving the economic fallout of the pandemic.

The survey released on Monday also shows that nearly 40 per cent small- and medium-sized enterprises (SMEs) worry they won’t recover from the economic fallout of the pandemic.

Almost one in four (23 per cent) regret not selling their business sooner, and a nearly equal number (24 per cent) are looking to sell due to the higher costs and increased challenges associated with managing and protecting their employees during the pandemic, the survey shows.

‘A pivotal moment’

“We’re at a pivotal moment that could make or break many small-to-medium-sized companies,” said in a statement John Cho, head of KPMG’s deal advisory services.

“These companies are the backbone of the Canadian economy, and up to now, we have seen few insolvencies. But worries over a second wave leading to another shutdown has one in four seriously looking to exit their businesses.”

At the same time, nearly a third of entrepreneurs (29 per cent) say the pandemic has presented them with an opportunity to grow their business by buying a competitor, supplier, or diversifying into another sector, he added.

“While the last seven months has brought about a great deal of disruption to our economy, those companies that had invested in digital technology prior to the pandemic – or quickly pivoted when it hit – see real growth opportunities going forward,” Cho said.

“These companies are likely to be key drivers in our economic recovery.”

The survey shows that almost 80 per cent of entrepreneurs believe that digital transformation of their business is the key to their survival and nearly two-thirds (64 per cent) have already adopted new digital and emerging technologies .

“The pandemic has highlighted how essential investments in digital technology have been – not just to simply survive but to be in a position to succeed going forward,” said in a statement Yannick Archambault, national family office leader for KPMG Enterprise in Canada.

“It is critical that small- and medium-sized business owners in Canada assess their own desire and commitment to make the technology investments needed to compete going forward.”