A new report, released Monday by Retail Council of Canada (RCC), indicates nearly half of small and midsized businesses anticipate increased annual gross sales in 2024 compared to 2023, reflecting a positive outlook on business growth.
RCC released the new survey, Navigating the Future: A Study of Sales Strategies and Challenges for Canada’s Retail SMBs , conducted by Leger that explores the sales practices employed by small and medium-sized businesses (SMBs) nationwide to connect with customers and drive sales. The research also analyzes the adoption of new sales channels and integration of digital tools, and their impact on SMB optimism and economic prospects.
The findings from over 750 SMBs underscores SMBs in Canada now have access to affordable, powerful digital tools and platforms that enable innovative selling methods, complementing traditional practices if desired.
In a news release, RCC said the survey finds that despite the rise of digital sales channels, brick-and-mortar stores continue to be the preferred sales method for 50 per cent of SMB sellers, contributing to 31 per cent of their revenue on average.
“Web store ranks as the second most popular method at 41 per cent. However, SMB sellers can now effortlessly enhance these sales channels with online marketplaces, click-to-buy features on social media, and other easy-to-use alternatives. The distinction between digital versus physical, or online versus offline sales, is now an outdated and inadequate way to describe current retail operations. Regardless of their size, even the smallest SMBs with fewer than 10 employees can adopt advanced sales strategies that compete with, or even surpass, those of larger traditional retailers,” said the RCC.
“Small and medium-sized businesses have shown incredible resilience, using a variety of methods—e-commerce, in-store, and hybrid approaches—to keep connecting with consumers during and after COVID-19. This adaptability has allowed them to continue delivering the products and services consumers across our country rely on. The survey results highlight SMBs’ ability to innovate, and despite past and current challenges, they remain optimistic about future growth,” said Diane J. Brisebois, President and CEO, Retail Council of Canada.
“This survey is great news,” said Federal Minister of Small Business Rechie Valdez. “It reflects how our government’s initiatives, like the Canada Digital Adoption Program, is empowering small and medium-sized retailers in Canada to seize new opportunities. It’s encouraging to see Canadian retailers embracing digital tools and having the choice to partner with those who best support their growth. Together, we’re driving entrepreneurial success and strengthening Canada’s economy.”
KEY FINDINGS
- Multichannel adoption is prevalent, with 60 per cent of SMB sellers using more than one sales channel, and 34 per cent utilizing at least three different methods. The average SMB uses two sales channels to sell products;
- The eight most popular sales channels used by SMBs in Canada are: Brick & Mortar Store (50 per cent), Web Store (41 per cent), Online Marketplace (33 per cent), Click-to-Buy on Social Media (28 per cent), Offline Marketplace (25 per cent), App Store (22 per cent), Wholesale (11 per cent), and On-Demand Delivery (10 per cent);
- 71 per cent of SMB revenue is driven by the top four sales methods: Brick and Mortar (31 per cent), Web Store (15 per cent), Online Marketplace (14 per cent), and Click-to-Buy Social (11 per cent);
- While using a digital sales method, most SMBs often leverage multiple companies. For example, 84 per cent of SMB sellers on Amazon Marketplace concurrently engage in sales on at least one additional online marketplace platform. 52 per cent also offer their products on eBay, 33 per cent on Facebook Marketplace, and 25 per cent on Etsy;
- Nearly half of SMBs anticipate increased annual gross sales in 2024 compared to 2023, reflecting a positive outlook on business growth;
- The more sales channels SMBs employ, the more optimistic they are about their business prospects, highlighting the importance of diversification;
- 88 per cent of SMB Sellers utilize at least one digital tool, with Payment Processing Systems (45 per cent) being the most common, followed by Social Media Management (33 per cent) and Mobile Payment Systems (32 per cent);
- Integrated digital tools, such as payment processing systems, social media management, and mobile payment systems play a crucial role in SMB success, with 94 per cent of all SMBs emphasizing their importance.
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