SMEs are slow to regain their pre-pandemic income

Although many SMEs have now reopened their doors, very few of them have regained their pre-pandemic revenues, according to the Canadian Federation of Independent Business (CFIB), which calls for an extension of the measures. government aid.

In the restaurant sector, in particular, 9 out of 10 companies were forced to increase their debt during the pandemic.

© Renaud Philippe Le Devoir
In the restaurant sector, in particular, 9 out of 10 companies were forced to increase their debt during the pandemic.

More than three-quarters of SMEs are now open unrestricted in Canada, reports CFIB based on a survey conducted August 5-10 of 2,878 of its members. The return to normal is slower in terms of the number of employees, with almost half of them (47%) having returned to their pre-COVID-19 workforce.

But it is in terms of sales that the shortfall remains the greatest: only 39% of SMEs report a return to normal income.

“Even when owners can resume their activities and acquire a sufficient workforce, there is no guarantee that the majority of their customers will return and that their sales will return to the usual level in the immediate future”, notes a fifteen-page report, which the CFIB released on Tuesdayi.

This delay in the resumption of sales is not without affecting the ability of companies to repay the debts they contracted during the crisis, underlines the CFIB. However, in May, 7 out of 10 SME owners said they had taken on debt to deal with the repercussions of the pandemic, with an average debt of $ 170,000 per company, for a pan-Canadian total of almost $ 139 billion.

“Although the overall average debt accumulated due to COVID-19 has been relatively stable for six months, its repayment will be the next major challenge for SMEs. [étant donné] that they still have to face several difficulties: insufficient income, limited reception capacity and general uncertainty, while autumn and winter are upon us ”, argued in a press release François Vincent, vice-president of CFIB.

Contrasting reality

These averages also hide significant variations between different regions and different economic sectors.

In Quebec, the return to normalcy seems in particular a little more advanced, at the rate of 80% of fully opened SMEs, 51% with all their staff and 49% with normal revenues. The level of debt incurred by COVID-19 also appears to be somewhat less pronounced, with an average debt per company of $ 96,500, for a total of just over $ 15 billion.

However, the greatest differences can be observed between economic sectors. While about half of Canadian SMEs were forced to increase their debt during the pandemic in the relatively less affected areas of finance, insurance or real estate, we are talking about 9 out of 10 companies in the world. world of the arts, that of leisure and information or in that of accommodation and catering. The additional debt in question is not the same either, with an average of just $ 89,000 per company in the finance sector compared to $ 220,000 for the manufacturing sector and $ 333,000 for that of accommodation and catering.

No wonder, says CFIB, that three-quarters of Canadian SMEs that have had to take on new debt because of COVID-19 don’t believe they’re finished paying it off in a year, that almost half don’t think it’s two years will not be enough either and that 13% fear they will never get there. These prospects appear even bleaker in accommodation and food services, where, this time, two-thirds of companies who think they need more than two years and a quarter who say it is wasted effort.

In this context, governments should not reduce, but improve and extend their assistance programs for businesses, concludes the CFIB in particular.

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