Canadian small-business confidence has fallen to its lowest level in three years as rising operating costs, weaker revenues and economic uncertainty put pressure on owners, according to a new survey from Zensurance.
The fifth annual Zensurance Small Business Confidence Index found that confidence fell to 49 per cent this year, down from 58 per cent in 2025 and 70 per cent in 2024. Nearly half of respondents said they had considered closing their business permanently at some point this year, while four in five reported having three months of cash reserves or less.
Rising costs weigh on businesses
The survey of 1,000 owners, entrepreneurs and self-employed professionals found that 59 per cent said the economy had negatively affected their business since the beginning of 2026.
Seventy-one per cent said total operating expenses had increased from last year, while 58 per cent said higher gas and fuel costs had hurt their bottom line. Forty-three per cent reported lower revenues than in the first half of 2025.
Despite those pressures, nearly half of respondents said they remained confident about the months ahead.
“Business owners cannot control inflation, tariffs or shifts in the economy, but they can prepare for unexpected events that could threaten everything they’ve built. Business insurance is one of the ways owners can help protect themselves against those setbacks,” said Danish Yusuf, CEO and Founder of Zensurance. “Our research suggests many businesses are focused on surviving today’s financial pressures while overlooking risks that could create even greater challenges tomorrow.”
Insurance gap widens
The survey also found that 61 per cent of small businesses are operating without insurance coverage, nearly double the 33 per cent reported in 2024.
Customer nonpayment for completed work was identified as the most significant business risk by 29 per cent of respondents. Cyberattacks or data breaches followed at 14 per cent, while nine per cent identified theft or vandalism.
Among businesses without coverage, 29 per cent said they did not think they needed insurance, 38 per cent said they did not face the types of risks covered by insurance and 22 per cent said their business had no risks at all.
Buy Canadian impact varies
The survey found that the impact of the “Buy Canadian” movement on small businesses has been mixed.
Seventeen per cent of owners said the movement had a noticeable positive effect on revenues or customer demand, including six per cent who said it had significantly increased the number of Canadian customers.
Thirty-eight per cent said the movement had made no difference.
Regional pressures differ
Cost concerns also varied across the country.
In Atlantic Canada, 75 per cent of respondents identified gas prices as a challenge, compared with 58 per cent nationally. Ontario had the highest share of respondents identifying inflation as their top concern, at 38 per cent.
British Columbia had the highest proportion of business owners who said they had considered closing permanently at some point this year, at 57 per cent. In Alberta, the figure was 39 per cent.
“Small business owners are often focused on the challenges they can see every day – costs, revenue and the economy – but the risks they cannot predict can have an equally significant impact,” said Yusuf. “Understanding where they may be exposed can help owners make informed decisions about protecting the businesses they’ve worked so hard to build.”
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