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Pierre Cléroux: Vice-President, Research and Chief Economist at BDC


Vice President, Research and Chief Economist at BDC, Pierre Cléroux had a chat with us about new trends that business owners can utilize positively and his suggestions on the best ways to market small and medium-sized businesses

Pierre Cléroux was appointed Vice President, Research and Chief Economist at BDC in 2012.

Pierre leads a team of experts who analyze economic data to identify business and sector trends impacting Canadian entrepreneurs. A seasoned speaker, he regularly travels across the country to help business owners understand the risks and opportunities presented by the economic environment.

Mr. Cléroux is also responsible for providing economic analysis and advice to the Bank’s senior management team and supervises all marketing and industry research activities.

Over his 25-year career as an economist, he has held several influential positions that had a direct impact on entrepreneurs in Canada and abroad.

Before joining BDC, Pierre worked for the Government of Saudi Arabia as Vice President, Business Analysis in the National Industry Clusters Development Program. His role was to create program strategies, define sector policies and conduct financial and economic analyses of industrial projects.

Previously, Mr. Cléroux was the Quebec Assistant Deputy Minister for Economic Development, Innovation and Export Trade, responsible for the implementation of economic policies and programs to support small and medium-sized businesses and encourage entrepreneurship. He was also a strategic advisor for Montreal International, where he was responsible for attracting foreign investment from India and the Middle East, and developing international relationships and partnerships. He worked for 12 years at the Canadian Federation of Independent Business in various roles, including economist and Quebec Vice President.

He holds a Bachelor of Arts and a master’s degree in Economics from Laval University, as well as an MBA from the MIT Sloan School of Management.

Follow @PierreCleroux all the latest economic updates

As vice president of research and chief economist at BDC, you lead a team of specialists who examine economic data to identify business and sector trends impacting Canadian entrepreneurs. What are some of the trends that you have come across that impact small- and medium-sized businesses in Canada positively or negatively?

With shifting demographics and the rise of new digital technologies, Canadian entrepreneurs are facing a new reality—one marked by changing dynamics in the labour force and new ways of doing business. We’ve identified six trends that will fundamentally reshape Canada’s future business landscape:

  • The ageing workforce.
  • The rise of the millennial generation
  • A more culturally diverse population
  • The growth of virtual marketplaces
  • The automation of business activities
  • The rise of the data economy

Adapting to these trends is a must and presents opportunities for Canada’s SMEs.


As time goes on, there are always new trends happening that business owners pick up on. What are some of the future trends that you see happening for small- and medium-sized businesses in Canada, and how do you think these trends will impact their businesses?

Entrepreneurs stand to gain from adapting to the trends in shifting labour demographics and technology. The impacts of these trends are profound and offer great opportunities for Canadian business owners. Those who get ahead of the changes are building stronger, faster-growing, and more profitable companies.

Embracing cultural diversity is a good example; entrepreneurs need to do more to understand the contributions that new Canadians could make to their businesses. Entrepreneurs are currently missing out on this important pool of talent.

Another good example is digital platforms, which are making it simpler and more convenient for customers to get what they want, when they want it, and how they want it. Consumers are making purchases armed with more information than ever before. In fact, BDC found that nine out of ten consumers systematically visit a company’s website before contacting it for information, and more than half of the business-to-business buying process is done online before a salesperson is contacted. Businesses that have embraced digital technologies have improved their customer experience (49%), boosted revenue growth (34%), and enhanced their efficiency through lower costs (36%) and better productivity (45%).


You talk about risks and opportunities presented by the economic environment towards business owners. What are some of the most common risks that the economic environment can have on small and medium-sized businesses in Canada, and what can business owners do to prevent them?

Rising interest rates will have an impact on financing. Notwithstanding interest rates, two-thirds of business owners see stable financing conditions.

BDC found out that Canadian entrepreneurs remain confident despite current trade turbulence. They’ve recently been bombarded with news about potential trade disasters and actual natural disasters, including forest fires, earthquakes and hurricanes. Despite all the turbulence, we found out that close to 80% of the owners of small- and medium-sized businesses we surveyed saw stable or increasing sales over the past twelve months, even after considerable growth in the first half of 2017. As well, the majority of respondents expect sales to improve further over the next twelve months.

When asked about their perception of conditions for their competitors, their region, and the Canadian economy in general, business owners were a little less optimistic, and it’s not surprising.

While US trade protectionism will not disappear in the near future, Canadian companies can weather this storm by continuing to focus on existing customers while seeking out new markets. Diversification correlates strongly with financial success. Investing in innovation to develop new products or processes can improve a competitive position and possibly allow a business to charge higher prices if its margins are squeezed by higher input prices. When times are uncertain, it’s a good idea to keep a tight grip on costs, review all expenses, and see where to find savings.


What are the top three opportunities that the economic environment has on small- and medium-sized businesses in Canada?

Business Transitions. Forty-one percent of Canadian entrepreneurs intend to sell their businesses over the next five years. There are opportunities for buyers and sellers alike.

Technology. In today’s marketplace, integrating the right information systems and communication technology into a company can give a much needed competitive edge. Effective business technology management can increase productivity and profitability to improve performance.

Market diversification. Diversify a business by finding new suppliers and developing new products and services to sell internationally. It’s time to investigate the trade agreements Canada has signed with the European Union (CETA) and many of the Pacific Rim countries (CPTPP).


One of your responsibilities is to provide economic analysis and advice to the senior management team at the Bank. Concerning small- and medium-sized businesses, what’s the economic forecast that you see happening?

The Canadian economy is showing stable growth and grew a solid 2.9% annualized in the second quarter of 2018, in line with the Bank of Canada’s expectations. Consumer spending picked up after decelerating in the first quarter, as did goods exports, which rebounded with 15% annualized growth. Business investment, though still positive, slowed down after a very strong first quarter, and residential investment reversed its negative slide. After impressive growth in 2017, the expansion appears to be stabilizing around 2%, a more sustainable pace for an advanced economy with an ageing population.

The Canadian dollar is unlikely to appreciate significantly against the US dollar until a NAFTA deal is achieved. This situation is positive for exporters not facing US import tariffs. Interest rates are likely to continue to move up, so it’s a good time to make sure the business is managing its debt load effectively. It may make sense to make productivity-enhancing investments sooner rather than later to take advantage of still low interest rates.

If a business is operating in the retail sector, margins are no doubt under pressure as wages are rising and revenues may be slowing. Considering where costs can be trimmed and taking advantage of technology to improve efficiency are interesting options.


In your position, you also supervise all marketing and industry research activities. What are some suggestions you can give when it comes to marketing to the owners of small- and medium-sized businesses?

Consumer behaviors are evolving faster than ever. Entrepreneurs have to stay on top of consumer trends to better compete and grow. BDC has identified five consumer trends that will transform the way we do business:

  1. Millennials are driving the consumer revolution. They are driving a profound transformation in habits among all consumers. They tend to be frugal, savvy shoppers and not particularly brand loyal.
  2. Mobile and digital rule. Canadians use their mobile devices more than ever, especially for shopping. It’s vital for businesses to not only be online but also offer a mobile-friendly website.
  3. Consumers want personalized attention. Customers expect more and more personalized interaction on all platforms, as well as customized offerings to make their shopping experience more relevant.
  4. The rise of the sharing economy. Collaborative or “sharing” economy companies operate under a new economic model in which ownership and access are shared between corporations, startups and people. People get the products or services they want from one another rather than from established brands, which used to be their only options.
  5. Canadians are more concerned about their health. People want to eat healthy, proactively take care of their health, and fight stress.


As an economist, you have seen many mistakes that business owners make that can put their companies in jeopardy. What would you say is the most common mistake that business owners make when it comes to managing their businesses?

Managing financial resources and waiting too long to ask for help when times are tougher are at the top of the list! I suggest entrepreneurs take a look at’s “articles and tools” section, where they can find valuable advice.


As a specialist in your field, when would you say is a good time for business owners to say that they have fully thrived and have a good successful business?

Business owners are in a better position to judge when they have succeeded; it all depends on reaching the goals set.


You have a lot of experience in developing international relationships and partnerships. Do you believe that small- and medium-sized businesses should participate in international trades, or do you believe that doing so will jeopardize their companies’ ability to participate in such large trades?

Yes. At a certain size, diversification and international trade is a must.


At one point, you were responsible for the implementation of economic policies and programs to support small- and medium-sized businesses and encourage entrepreneurship. Can you talk about some of the programs or policies that can help small- and medium-sized businesses be successful?

Research has shown that businesses that have embraced digital technologies have improved their customer experience (49%), boosted revenue growth (34%), and enhanced their efficiency through lower costs (36%) and better productivity (45%). I believe the government should launch a program to encourage and stimulate investments in technology because it benefits Canada’s SMEs and the economy.


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