As the Canadian economy is emerging from struggling for 2 years after the pandemic, the importance of October as Small Business Month is more imperative than ever. Not only is it a time for SME entrepreneurs to come together and learn from each other and take needed or supplementary classes to update their skill sets, but this month is also the time when everyone can take extra care to help support those budding SMEs in their communities. While SMEs make up about 97.9% of the businesses in Canada, contributing roughly 52.3% of the Canadian GDP, it’s important to recognize what supporting your local SMEs can do to help your community. “SMEs represent such a significant portion of our GDP it’s shocking how little support they actually receive across Canada. They aren’t only what allows our economy to run, but when supporting SMEs you’re actually helping real people earn a living,” Marc Pearson, VP, Global Channels and Alliances at Cubeler, frames the entire idea behind the “raison d’etre” of the company. With that in mind, Cubeler would like to announce that by the end of 2022, we will be launching our Cubeler Business Hub TM for all SMEs across Canada. On the hub, we are planning to offer SMEs who join Financial, Advertising, and Marketing advice and help, in addition to statistical-based Insights. All of which are the pillars on which Cubeler is based around. For the moment, as we near the launch date, we will unroll each of the pillars aforementioned, starting late in 2022.
More than the obvious of supporting your local businesses, it’s been reported time and time again that SMEs tend to pour a lot of their earnings back into their own community, supporting local events, people, other businesses, etc. For a more concrete example, it’s “estimated that for every 100$ spent on your local businesses, 68% that remains local, and is redistributed amongst the community.” Supporting your local vendors also supports you. The statistics suggest that the more profitable and prosperous your local SMEs are, the more job opportunities they can offer to the growing Canadian population. Another aspect to add to the increased job opportunities provided to the local population is that the local infrastructure supports the local people, and shopping local VS online via Amazon or at big box retailers, for example, ensures that all the sales tax you put into your purchases gets redistributed amongst your community. Local businesses tend to recirculate 63% of their earned revenue within their communities compared to a minuscule 14% from chain retailers. It also means money into local infrastructure, and more money to beautify where you live. The added benefits to a community are astronomical, and you will also be helping your neighbours support themselves. It’s important to note that it takes much longer for your local shops to recover from economical challenges. During the global recession of 2007-2009, many SMEs ended up trying to recover and pay debts back to lenders as much as 10 years later. Compared to that crisis, and according to McKinsey & Company, coming out of the pandemic, those same SMEs could still require an additional 5 years minimum on the back of this latest crisis. Coming out of the recovery phase from the recession, this is an added blow to many SMEs Canada-wide.
When it comes to supporting our local shops, you need to look at how it impacts the individual, your neighbor, and the cascading effect it can have on your neighborhood. Not to be a doomsayer, but oftentimes, when local shops start dying out, and nothing comes in to replace them, you end up left with vacant storefronts, and that generally doesn’t bode well for the area as a whole. Less commerce, and less local spirit, mean less foot traffic, which leads to less business for those storefronts that remain open and are already struggling to survive. Ultimately, leading to even those remaining few needing to board up and either shut down altogether or move to a trendier area which again, is not good for your neighborhoods. Taking advantage of this now, 16-year-old tradition that started in 2006, as an offshoot of the Small Business Week which started even longer ago in 1979, this is an ongoing tradition that has lasted 43 years, and now more than ever is needed to help keep SMEs thriving. What’s important to remember though, is that despite it only being an SME month, shopping at your local stores should be an ongoing habit, one that carries forth throughout the year, and the best thing about shopping local is what you can find in your local shops comes down to more than just the truly personal service you receive, but the products you can purchase tend to be much more specialized and unique, perhaps fitting whatever reason you’re shopping for much more than a generic brand “dinglehopper.”
Buying locally also contributes much more to overall Canadian employment. In 2020 SMEs were responsible for generating 92.1% of the net employment across Canada. Another key aspect that reflects the ongoing issues with supply chains in Canada, just as with the rest of the world, is that buying locally often reduces the need for extensive supply chains that can get stoppered due to shipment issues. The current rise in costs for most goods from people’s grocery bills to really anything bought over the counter is due to shortages of shipping containers and the number of people who are returning to their jobs within the shipping industry. When you buy locally, not only are you contributing to your local economic wealth, but often, because local vendors tend to source their wares and goods locally as well, the cost of transportation often decreases drastically. There is less need for as much fuel to be used for that transportation, less time between where products are sourced from to the store shelves, which again comes with added reductions in fuel costs, and so on and so forth. The more people continue to buy locally, the more they will contribute to reducing the overall cost of goods, while supporting and helping to grow the local economy, accounting for more readily available employment, which would then further allow more people to spend more money accordingly. The entire process has a vast cascading effect which leads to richer local markets, vendors, and people as a whole.
There are also many non directly economic effects which can benefit from buying local as well. Buying from local vendors means that merchandise or food, for example, doesn’t have to travel as far to arrive at its destination, be it on your plate or simply in your hands for daily use. There are arguments that can be made saying that in the short term, purchasing locally can be slightly more expensive, however, consumers need to look at why that is. Your local producer needs to charge more because of the volume of sales versus their stock. They can only produce a limited quantity of any item since most local providers do not have the means to produce in mass quantities equivalent to that of your nearest Walmart or national chain. Another aspect that mass production of goods such as foodstuffs has is the lessening of product quality. This applies not only to food, but individual local vendors will take extra time to ensure that all their goods are in much better condition as they have more time to review all their stocks, while the mentality of larger chains tends to be simply the sheer volume of stock sold. Higher quality goods mean that yes, while the cost of acquisition may be slightly higher in your local shops, it means that you will not need to replace things as often, you will get better customer service, more customized service, and save money in the long run as you will not need to replace what you purchased as quickly. Moreover, the more people buy locally, the more products that the same vendor can then produce and or offer which will in the long run end up reducing the cost, but because they are still not producing in the enormous quantities that large chain retailers are producing still means that the quality of all your goods purchased, no matter the type of good, will be of a higher quality and result in more bang for your buck.
All these facts not only work to strengthen the Canadian economy as a whole, but keep in mind that the slightly higher price point you pay today, will not only help your neighbors eat and put a roof over their heads, but you can rest assured that the more people continue to purchase in this way, means that the prices will eventually go down, even if marginally, while still maintaining a much higher quality of goods and services. Remember this, according to the Canadian Federation of Independent Business, only 40% of SMEs are back to earning their normal reported revenues since before the pandemic, with 65% of them having had to take on a debt that averages out to about 160,000$ only to survive the fallout of the Pandemic, which was reported by Dan Kelly the President and CEO of CFIB. As the economical recovery for Canadian SMEs is still very much underway, we need to ensure that we do what’s possible to keep this business sector, SMEs, alive and well as they are supporting the majority of our country. So, even if only for October, the long-term benefits will have massive ramifications! More details are to come as SMEs continue to recover, but rest assured that our goal at Cubeler is to offer direct support for all SMEs across the country. If you’d like to remain in the know, and help out this recuperating sector, be sure to keep up with us at Cubeler.com to keep up to date on how things progress, and the various ways you and other businesses can support one another.