SMEs certain about uncertainty, but confident: Amex

TORONTO — Small and medium enterprises (SMEs) have shown incredible resilience throughout the pandemic, adopting new strategies to adapt to the changing business climate.

With uncertainty being the only certainty going forward, 74% of SMEs surveyed by American Express Canada are feeling confident about the next one to three years, but they face persistent challenges related to cash flow, supplier payments and time management.

The survey revealed 37% of businesses reduced operating costs and 21% will continue to implement cost saving initiatives while 15% will modernize processes through technology.

Sixty-four per cent face cash flow problems as a direct result of the pandemic and just over half (51%) agree that these problems present the most immediate threat to their businesses. Overall, 25% do not have enough cash flow to sustain their business.

Doing business internationally presents further challenges for the 29% of respondents that say the nature of their business requires them to make payments to suppliers outside of Canada. One quarter of these businesses reported the need for more flexible payment terms due to reduced cash flow, 44% reported delays in payments and 35% reported a shortage of raw materials and supplies.

Payment and cash flow challenges are hindering companies at a time when they need to focus on top-line focused initiatives. The survey found 85% of businesses spend up to half their day doing paperwork and managing supplier payments; and 40% would rather be spending time working on customer services, 38% on marketing and sales and 38% on business development.

Forty-six per cent are expecting revenue to decrease this season compared to last year, 67% say e-commerce will be critical this year and 52% say social media will be more important than ever to engage with customers.

This survey was conducted by The Nielsen Company on behalf of American Express from Sept. 16 to Oct. 2 among 500 Canadian business owners or partners.