We had the privilege to interview Jason Charlebois, Senior Vice President, Small Business, Scotiabank, who discussed about Scotiabank’s most recent Path to Impact Report, its insights in view of the current economic environment that small businesses are facing, possible outcomes to address the issues of small businesses being affected by inflation and rising interest rates, the most effective strategies for assisting small businesses to overcome the labour market shortage, material sourcing, etc, followed by his recommendations for small businesses to assist them in overcoming obstacles on the road to success.
Jason started his career in branch banking in Ottawa and his last branch assignment was at Scotia Plaza branch in Toronto as a member of the management team. Since then, Jason has held roles across Wealth Management, Marketing, Digital Channels, Contact Centres, Mergers & Acquisitions, Credit Cards, and Technology all within Scotiabank. Jason has his MBA from Queen’s University and was a member of the Governor General’s leadership council. He loves to travel and lives in downtown Toronto.
How will you describe your journey as the Senior Vice President, Small Business at Scotiabank, and holding many roles after starting your career in branch banking in Ottawa?
My journey in banking has been one of evolution. There aren’t many sectors that I haven’t touched in some way, and I’ve been fortunate enough to have the opportunity to be involved in so many different teams along the way, all of which have been incredibly beneficial to my own personal career trajectory.
From my start in branch banking in Ottawa through my various customer-facing roles, I was able to learn and understand the needs of customers and was able to provide advice and solutions to help them achieve their goals. As my career evolved, I’ve had the privilege to hold leadership roles across Marketing, Wealth Management, Mergers & Acquisitions, Digital Channels, and Technology & Operations all within Scotiabank. These experiences allowed me to foster a great depth of understanding of many of the facets of our business, providing me with greater insight into what our customers need most.
Currently, I am responsible for leading the end-to-end delivery of products, services, and advice to meet the needs of small businesses and owners across Canada.
What do you think about Scotiabank’s most recent Path to Impact Report? And what insights does the report provide regarding the current economic environment that small businesses are facing?
The 2022 Path to Impact Report is all about operating in the new normal. Having, for the most part, moved past the most covid restrictions, we were pleased to see many business owners reporting that the state of their business overall has improved.
While we had hoped this year’s report would be a story of a full recovery to pre-pandemic conditions, there are still contemporary challenges for business owners, including inflation, rising interest rates, and beyond.
In the survey, we found that two-thirds of business owners are extremely or very optimistic about the future state of their business. What’s more, the majority also say they’re better equipped today to survive another wave of the pandemic (83%) and now feel equipped to handle a possible recession (81%).
Despite the optimism, many small businesses are still worried about inflation, rising interest rates, supply chain issues, and a labor market shortage. We know that running a business right now is more expensive than ever before. Among the small businesses concerned about costs due to inflation (34%), four in ten (41%) say it’s having a critical or significant impact on their current operations. A quarter of respondents are also currently concerned about rising interest rates (24%), and nearly half say it’s having a critical or significant impact on their business.
As businesses look ahead to the future, financial priorities are mixed. However, what we do know is that two-thirds of business owners (65%) foresee needing more financing in the future to continue their business operations. That need is greater among larger businesses and the number is also significantly higher among the Black, Indigenous, and other People of Colour (BIPOC) business owners (87%).
Since the majority of small businesses report being affected by inflation and rising interest rates, what are the possible outcomes of this issue?
We know from our 2022 Path to Impact Report that more than a third (34%) of small businesses say they’re being impacted by inflation. Of those, 37% say it’s having a significant impact and 4% say it’s having a critical impact on their operations.
Small businesses are also facing headwinds when it comes to the volatility of the rising interest rate. Although interest rates aren’t as significant of a concern for small business owners when compared to the impacts of inflation, as mentioned, nearly a quarter of those (24%) surveyed in our report still say it’s a problem for them. Among those impacted, nearly half (47%) say it’s having a critical or significant impact on their business.
From that, we know these have been challenging times for small businesses across Canada, and they will continue to be obstacles to overcome and manage. With regard to possible outcomes of these issues, we would strongly encourage small business owners to talk to a Small Business Advisor. Small Business Advisors are equipped with the right tools and knowledge to help them navigate the complications and concerns that may arise in this changing economic environment.
What, in your opinion, are the most effective strategies for assisting small businesses to overcome the labor market shortage, material sourcing, and cash flow issues that have afflicted them over the past two years?
In addition to the challenges that arise from inflation and climbing interest rates, we know many business owners have struggled and continue to struggle with the labor market crunch, supply chain challenges, and cash flow issues.
From our research, we found that a quarter of small businesses (25%) say they are currently being challenged by sourcing and hiring talented staff and more than a third (34%) are dealing with higher costs of materials and supplies.
We also found that 22% are concerned about cash flow and funding – a drop from last year. In fact, 46% of business owners report that their sales and revenue have increased in the past two years and others are reporting an improved demand for their products and services.
Still, we know it’s not the same story for every owner, and for those concerned about the labor shortage, material costs, and cash flow – time is critical, so taking advice from a trusted source is more important than ever.
Encouragingly, small business owners are open to advise – with 90% of owners turning to someone over the past two years. Although sources are diverse when it comes to the type of advice, we know that half turned to their financial institution – either with an advisor or through their bank’s digital resources.
Specifically, when speaking with a Scotiabank Small Business Advisor, those concerned about these ongoing economic challenges will know they can explore financing options, how to stay ahead of the curve and have a contingency plan, spot new opportunities, and discover a host of other tools at their disposal.
What specific recommendations do you have for small businesses that will assist them in overcoming obstacles on the road to success?
As we look ahead to 2023, Scotiabank has several tips for small business owners. Whether it’s fluctuations with inflation, further interest rate hikes, labor market challenges, or staffing issues, businesses large and small can and should speak with a trusted Scotiabank Small Business Advisor to tackle whatever comes their way.
Specifically, we’ve outlined five key things small business owners can do to be better prepared.
First, they should proactively explore financing options – whether it’s increasing a line of credit or needing support in finding a government-based assistance program, Small Business Advisors are on your side.
Owners should also ensure wasteful practices aren’t affecting their bottom line. With nearly a third of small businesses ranking cutting costs wherever possible as their number one immediate priority, they should look to find efficiencies in daily operations to ensure they’re maximizing revenue.
Third, it’s important for businesses to keep their eyes on the future and stay ahead of the curve on trends. Anticipating changes and having a contingency plan is a must. More than 80% of small businesses surveyed said they received some form of financial help from the government during the pandemic and some of those relief loans are set to come due next year. Working on a replacement strategy now is one of the best practices owners can follow.
Business owners should also keep digital top of their minds as the global economy and advances in technology have created a giant world market with an array of new commerce opportunities to tap into.
Finally, business owners should be looking to spot those new opportunities. Evolving and learning from past successes and failures is a great way to grow.
As always, business owners can turn to a Scotiabank Small Business Advisor. Regardless of where business owners are at – if they’re just starting out or already well-established, they can visit the Scotiabank Advice+ Centre for Business to get the assistance they need.
