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Uncertainty is the only certainty for recovering Canadian small businesses

Cash flow remains pressing threat for businesses despite optimism, American Express Canada survey finds


TORONTONov. 18, 2020 /CNW/ – Canadian 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, American Express Canada commissioned a survey to understand SMEs ongoing pain points, current priorities and plans for the future.

While the survey reveals 74 per cent of SMEs are feeling confident when looking at the future of their business in the next 1-3 years, challenges related to cash flow, supplier payments and time management persist as businesses continue on their journeys towards rebuilding.

“Small business resilience is amazing. From the outset, SMEs adapted quickly and strategically to keep business running,” says Paul Roman, Vice President and General Manager of Global Commercial Services, American Express Canada. “The last eight months have presented challenges no one could have foreseen but the optimism felt among Canadian business owners is a true testament to the agility and strength of entrepreneurs.”

Cash flow and international payment issues remain critical

At the onset of the Covid-19 pandemic, many SMEs took immediate action to adjust their business models in order to stay afloat. The survey revealed 37 per cent of SMEs reduced operating costs and 21 per cent report they will continue to implement cost saving programs while 15 per cent will modernize processes through technology.

Despite these initiatives, challenges related to cash flow and supplier payments continue to present pressing challenges for Canadian SMEs. In fact, among those surveyed, 64 per cent say they are facing 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 business. Overall, the research demonstrated nearly 1 in 4 say they do not have enough cash flow to sustain their business.

In addition to cash flow, doing business internationally presents further challenges for the 29 per cent of SMEs that say the nature of their business requires them to make payments to suppliers outside of Canada. When asked how international business has been impacted by the pandemic, one quarter of these businesses reported the need for more flexible payment terms due to reduced cash flow, 44 per cent reported delays in payments and 35 per cent reported a shortage of raw materials and supplies.

Finding time to focus on higher-impact initiatives is a challenge

These payment and cash flow challenges are hindering SMEs at a time when it is more important than ever to focus on top-line focused initiatives. The survey found that 85 per cent of businesses spend up to half their day doing paperwork and managing supplier payments, taking up precious time and resources they cannot afford to waste. In fact, 40 per cent of SMEs say they would rather be spending time working on customer services, 38 per cent on marketing and sales and 38 per cent on business development.

Time wasted on paperwork can be especially detrimental to businesses that rely heavily on revenue generated during the holiday season. With 46 per cent expecting revenue to decrease this season compared to last year, 67 per cent of SMEs say e-commerce will be critical this year and 52 per cent say social media will be more important than ever to engage with customers.

“Being able to focus on revenue-generating initiatives like product development and e-commerce is more important than ever,” says Roman. “At a time when SMEs are faced with persistent challenges, accessing the right payment tools and resources will enable them to free up time to focus on strategies to keep their business running today and be in a stronger competitive position for the future.”

American Express provides support with working capital and cash flow solutions for businesses of all sizes across the country. Through payment tools and services to help streamline processes, reduce costs and free up working capital, American Express enables businesses to put focus on what matters most.

To learn more about products and solutions designed to support small businesses, please visit here.

About the American Express SME Survey

This survey was conducted by The Nielsen Company on behalf of American Express from September 16 to October 2, 2020, among 500 Canadian business owners or partners in small or medium enterprises.

About American Express in Canada

American Express is a global services company, providing customers with access to products, insights and experiences that enrich lives and build business success. American Express was established in Canada in 1853 and offers a variety of consumer and business products. Learn more at and connect with us on FacebookTwitterYouTube and Instagram

SOURCE American Express Canada

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