Apr. 4, 2012, Richmond, B.C. — Canadian business owners remain optimistic about a domestic economic recovery, but many are pessimistic when it comes to the global economy, new research from business management software firm Sage reveals.
The annual Sage Business Index gathered the opinions of 2,278 Canadian business owners as part of a multi-country survey that also polled business owners in the United States, France, Germany, the United Kingdom, Spain, Austria, South Africa, Malaysia andSingapore.
The survey indicates that Canadian businesses have increased confidence about their prospects for the next six months, reporting an index score of 63.65 compared to 59.35 in the summer of 2011. Indexes are based on a scale where zero to 50 is negative and 50 to 100 is positive.
Canadian businesses were more confident than their counterparts in the U.S., U.K., and Europe.
When asked if they felt the Canadian economy had improved or declined over the past six months, the sentiment was slightly positive, scoring a 54.62 on the index.
While Canadian businesses are confident about their own prospects and those for the country overall, they remain pessimistic about the global economy, assigning it an index score of 45.53. Canadian businesses are not alone: businesses in the U.S., the U.K., Germany and other Eurozone countries expressed even greater pessimism for the global economy.
A majority of Canadian businesses surveyed (70 per cent) reported revenue either staying the same or increasing over the past six months. Only 19 per cent of respondents reported revenue decreasing over that same period.
When asked what the biggest concerns for their business are in the coming six months, half (51 per cent) indicated a rise in inflation and the increasing cost of energy. One-third (33 per cent) indicated instability and uncertainty in the local economic market, and one-quarter (25 per cent) cited instability and uncertainty in global economic markets, reduced cash flow in the supply chain, and increasing government regulation as concerns.
When Canadian businesses owners were asked about the role customer service has played, given the challenges of the economic downturn, less than half (47 per cent) indicated customer service had become more important in their operations over the last 12 months. Nearly four in ten (38 per cent) are committing more budget or resources to delivering customer service, while a little over one-third (34 per cent) are not.
"Given the role that Sage plays with our small and midsized business customers, we are in the unique position of giving these businesses a voice," said Nancy Harris, vice-president and general manager of the Sage Simply Accounting business. "The findings of the Sage Business Index continue to reflect the positive sentiment that many Canadian businesses have about the future of their companies and about the continued growth of the Canadian economy."
"With the price of energy continuing to affect consumers and business owners alike, we must be mindful of the impact this will have on the expected economic growth in Canada and around the world."
The Sage Business Index has a Canadian sample size of 2,278 with a 95 per cent confidence level and an error rate of +/- two per cent.