A new Ignite Digital SMB survey is raising questions about the strength of Canada’s “Buy Canadian” movement, suggesting that economic pressures may be reshaping consumer behaviour in ways that disadvantage domestic businesses.
The findings come at a time when Canadian small and medium-sized businesses are navigating a complex environment shaped by tariffs, inflation, and shifting consumer priorities. While public sentiment has leaned toward supporting local businesses, the data suggests that price sensitivity may ultimately be driving purchasing decisions.
Perception Gap Between Public Support and Actual Spending
The Ignite Digital SMB survey reveals that a significant majority of Canadian small business owners believe there is a disconnect between what consumers say and how they actually shop. Nationally, 79.4% of respondents indicated that Canadians may be “Faketriotic,” publicly supporting domestic businesses while privately choosing American alternatives to save money.
This perception is not limited to one region. Business owners across multiple provinces reported similar concerns, with particularly high levels in Newfoundland and Labrador, Quebec, and Ontario. Ontario, in particular, was identified by 60.8% of respondents as the most “Faketriotic” province, highlighting a perceived concentration of this behaviour in Canada’s largest market.
The financial implications are also notable. A combined majority of respondents said this behaviour is costing their businesses either “a little,” “a lot,” or “too much,” indicating that the issue is more than anecdotal.
Rising Costs and Structural Pressures Intensify Challenges
Beyond consumer behaviour, the SMB survey underscores the broader economic pressures facing Canadian small businesses. Rising costs remain the dominant concern, cited by 63.67% of respondents, followed by cash flow challenges and tariffs linked to U.S. trade actions.
Other operational pressures continue to mount. Business owners identified taxes and compliance, declining customer demand, and staffing challenges as persistent issues. Late payments and difficult client relationships were also cited as key pain points, reflecting ongoing strain on liquidity and operations.
Additionally, efforts to shift away from U.S. suppliers are proving costly. More than 60% of respondents said sourcing non-U.S. alternatives has had a significant or somewhat significant financial impact, adding another layer of complexity to already tight margins.
Fragility of SMB Survival Comes Into Focus
The survey also highlights the precarious financial position of many Canadian SMBs. When asked how long they could survive a 25% drop in business, nearly one-third of respondents said three to five months, while a smaller but concerning portion indicated less than one month.
Confidence levels appear equally strained. A combined 73.17% of respondents expressed uncertainty or pessimism about their ability to sustain their business long enough to eventually sell or retire.
This lack of confidence extends to personal reflections as well. Nearly half of respondents admitted to some level of regret about starting or purchasing their business, pointing to the emotional and financial toll of operating in the current environment.
Buy Canadian Movement Faces Economic Reality
The findings suggest that while the Buy Canadian movement has gained visibility, it may be encountering limits when faced with real economic trade-offs. Consumers, increasingly pressured by rising living costs, appear to be prioritizing price over origin in many cases.
For Canadian retailers and small businesses, this creates a challenging dynamic. On one hand, national sentiment offers an opportunity to build loyalty and brand identity. On the other, competitive pricing and operational efficiency remain critical to survival.
As Matthew Goulart, Founder of Ignite Digital, noted in the release, “We need to be brutally honest about the extreme and unforeseen challenges that Canadian SMBs are struggling through in 2026 and find real ways to support them before it’s too late.”
