Friday, October 30, 2009

Statistics Canada: 56% of Canadian Small Businesses are in Quebec & Ontario

In July 2008, Statistics Canada released facts and figures about the Canadian business community. The figures released indicated that, as of the end of 2007, Canada had more than 2.3 million businesses. (This figure reflects a decline of 100,000 businesses over the course of the year). This number included small businesses that met at least one of three minimum criteria. To qualify as an official small business, the establishment must have at least one paid employee (with regular payroll deductions). The business must have annual revenues of at least $30,000. Finally, the business must be incorporated and have filed a federal tax return at least once in the previous three years.

In regards to self employed Canadians, the number rose at an annualized rate of 1.5 percent between 2000 and 2007.

More than half of all Canadian businesses, some 56 percent, are located in Quebec and Ontario. Roughly a third of the businesses – 36 percent - are located in the western provinces and a mere 7 percent are located on the Atlantic side of the country. Less than 1 percent of Canada's businesses are situated in the Northwest Territories, the Yukon, and Nunavut.

However, when examining the business to population ratio, the numbers swing dramatically. The national average is 70.7 businesses per 1000 population. Ontario and Quebec fall below the national average while the Yukon has the highest ratio at 91.4 establishments per 1000.

Statistics revealed that entrepreneurs were more likely to reside in rural areas, rather than urban centres. The ratio of small businesses relative to population was 50% higher in rural regions of the country.

Finally, the survey concluded that 60 percent of small businesses are situated in areas that have large local populations, affording a strong employee base and good market opportunities.
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Wednesday, October 28, 2009

Starting a Small Business Survey: 12% to Establish Internet Enterprises

Starting and owning a small business appears to be the aspiration of many Canadians, according to the findings of a poll conducted for the Royal Bank of Canada (RBC).

Over the next several years, some 3.3 million Canadians intend to start their own business. Moreover, the survey found that there appears to be a change in preferred industry focus of would-be entrepreneurs. The desire to open a retail business dropped by 2 per cent from previous surveys; personal services and arts also dropped by 2 percent; and business services/consultancies dropped by 3 percent. The top industries of choice appear to be Internet related businesses. Nearly 12 percent of those interviewed plan to establish an online enterprise.

The RBC survey also rated advice by veteran entrepreneurs for newcomers to the business world. The top piece of advice was to do thorough research before setting up shop. Know exactly what you're getting into. Learn about your competition and be realistic about what share of the market you can capture.

Other pieces of popular advice of what to do before opening a new business included preparing a detailed business plan, networking with others in the field, allocating time and resources for marketing, surveying potential customers, and selecting the best site for the new enterprise.

The survey revealed that 61 percent of Canadian business owners are satisfied with the way they opened their business and would not change a thing, if they had to start over. More than 60 percent felt that, looking back, they probably should have started at a younger age. 58 percent of those surveyed felt that it would have been beneficial to get more financial advice at the onset.
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Tuesday, October 27, 2009

Organizing Your Small Business Home Office

More and more people are operating businesses from home, or keep an office at home. One of the most commonly overlooked tasks is keeping the home office organized.

For those of us who spend many hours deep within the confines of our home office, the surrounding environment all too often takes on the look of a natural disaster. Why not take a few minutes and put some order in your home office? After all, there is nothing worse than talking to an important client on the phone, reaching for the client's file, and coming up with a stack of takeout food menus.

Start throwing things away! Be brutal with your castoffs. Do you really need a collection of telephone directories for the last several years? Chances are slim that there is a growing demand for chewed pencil stubs. Contrary to popular folklore, empty chewing gum boxes prefer not to live on desktops. Choose a few items to throw away each day. You'll feel good about it!

Let's admit it. Almost every bulletin board contains layers of long forgotten items. Try digging down several layers and leave only the current important items. You may even free up space for new memos and current pictures.

How about the junk drawer? That's the drawer with the broken tape dispensers, dried-up pens, broken scissors, etc. It never fails that the special marker that you need is buried under mounds of old junk (and a semi open jar of glue). Take some time to organize that drawer so that you can find what you need, when you need it.

It is not true that every document ever read must stay in the filing cabinet. Old ones can be shredded. Others can be stored in cardboard cartons and put away in a storage area.

Finally, take a good look at your desktop. Take pity on your current work material and allow it to sit in a clean, orderly environment. It will respond in kind by being readily available and easily located when you need it.

Business is all about organization. This should extend to your personal work environment as well.
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Monday, October 26, 2009

E-commerce Provincial Sales Taxes

E-commerce has greatly increased many retail sales. Businesses, large and small, can now reach customers from coast to coast with relative ease, if they have a presence on the internet. However, a very interesting – and tricky - question arises from all these sales. Does a website vendor in one province selling taxable goods and/or services to customers in other provinces have to charge and remit other provinces' sales taxes?

Would that the answer were simple and straightforward. Just as taxes differ from province to province, so do the requirements for inter-provincial commerce.

Keep in mind that when dealing with tax related issues, it is better to err on the side of caution. Therefore, you should consult with your accountant and/or tax advisor to verify your own personal situation. Similarly, you can obtain detailed information from the finance/revenue ministries of the specific provinces in which you are conducting online business.

There are a number of factors that will determine your tax collection situation. As many small business owners are aware, you are exempt from charging and remitting the GST if you are a small supplier. However, even a business with small supplier status may have to register for GST if they conduct business in provinces that currently have HST (Harmonized Sales Taxes). The GST is part of the HST. Therefore, de facto, you will have to charge and remit provincial taxes in those provinces.

Some provinces have passed legislation requiring out-of-province vendors to register for their provincial taxes. Other provinces "suggest" registering.

Were you aware of the fact that if you, as a vendor, do not collect RST (retail sales tax) in a specific province, the responsibility falls onto the purchaser?

The tax issues are complicated and the requirements, and loopholes, are plenty. Before pursuing your sales in other provinces, check the tax requirements carefully with a qualified tax professional.
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Sunday, October 25, 2009

Need a Small Business Loan?

Eventually, most small businesses need additional capital, whether for start-up purposes or to expand an existing business. The technical process is usually straightforward; you have to ask for the money, whether from a financial institution or a private individual. Either way, the lenders will have some hard questions that you have to answer to their satisfaction. Being properly prepared is definitely to your advantage.

The lender will want to know what the money will be used for and how you will be able to repay the loan. Therefore, you should have a detailed business plan ready at hand as well as cash flow projections for your business. Additionally, a bank or commercial lending institution may wish to review your tax returns.

Prior to your approaching the lender, you may wish to check your credit rating via a credit report. Chances are very good that the lender will order such a report. Check your rating before the lender does. If you do not have a satisfactory credit rating, try and repair it before seeking a loan.

Be well-versed in all the details of your business and its finances, present and projected. Remember that applying for a loan is partly dependant on presentation, not just documents. You have to make an impressionable pitch to the lender and be able to answer all questions satisfactorily.

One area that shouldn't be overlooked is how you plan to share the risk with the lender. How much are you investing personally? This is equally important to the lender as is your knowledge of your business.

Consider preparing to apply for a loan as if you were making the most important sale of your career. If you can adequately impress and convince the person sitting opposite you, you may close the deal.
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Wednesday, October 21, 2009

Telephone Etiquette for Small Business 101

It may sound like a trivial subject, but that is far from the truth. Even in this computer age, the telephone is your front line. More often than not, a business is judged by how one is received over the telephone. Give the wrong impression and the transaction is over.

Try and be prompt. Don't let the telephone ring off the hook. No more than a few rings if necessary.

It is important to convey enthusiasm and professionalism. A warm, clear response, coupled with moderate tones and proper language convey a highly, professional image. Accents are most acceptable but improper language is not. Try and avoid using slang and leave professional jargon out of conversations with laymen.

Avoid leaving people on hold for an extended period of time. Even though the music on hold may be quite pleasant, remember to check back every half minute or so. If the desired person is not available, or will not be free to take the call for several minutes, offer to take a message before the caller asks.

We all have bad days. However, the rule of thumb is to leave it at the door. Don't convey your negative feelings to the caller.

Speakerphones should be avoided. The caller can hear when they are speaking to someone on a speaker. It gives the impression that you are simply too busy to lift the receiver.

If your telephone system is automated, be sure that the recorded voice sounds professional and that the information in the system is current.

Finally, be prompt about returning calls. If someone left a message, they do wish to speak to you. Good business sense dictates that a timely reply is the best course of action.
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Tuesday, October 20, 2009

Will Anti-Spam Legislation Put Spam Back In The Can?

If you have a computer with internet access, you receive SPAM. All that unwanted "junk mail" that clutters up you e-mail inbox is SPAM. The advertisements, the pleas, pledges and proposals, the prize notices – all this constitutes SPAM. Canada ranks as one of the leading countries for origination of SPAM. Current proposed legislation in Parliament has targeted SPAM but the business community has targeted the legislation.

The Electronic Commerce Protection Act, otherwise known as Bill C-27, will require a marketer to obtain implied or explicit consent from the consumer before sending them an e-mail. The Canadian Marketing Association (CMA), representing 800 of the nation's largest corporations, is lobbying MPs to change the proposed bill. The CMA is proposing that consumers should have to opt out of receiving commercial e-mail messages.

Supporters of the bill in Ottawa fear that an opt-out condition will water down the legislation and render it fairly useless. A similar action took place last year in legislation for telemarketing rules. Altering the bill caused it to have too many exceptions to make it practical to consumers.

The vast amount of SPAM that travels through the internet in Canada today undermines confidence in the internet as a platform for personal and business use. SPAM is considered by many to be an invasion of personal space and consumers are tired of being bombarded by advertisements that do not interest them but merely clutter up their e-mail.

While the business community has a strong vested interest in protecting this advertising option, MPs from both sides of the political arena are uniting to support this bill to protect consumers' rights. Ottawa wants to send a clear message that Canada will no longer be an international haven for SPAM.
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Monday, October 19, 2009

Canadian Broadband's Poor Rating

In a recently released report commissioned by U.S. regulators, Canada, compared to other leading nations, rates very poorly in areas such as national broadband adoption, network capacity, and prices.

Employing results from a detailed survey conducted by Harvard's Beekman Center for Internet and Society, Canada ranked a disappointing 22nd place overall out of 30 countries. Japan, Sweden and South Korea ranked highest in the survey. The United States placed 13th in the survey.

The survey was commissioned as a basis for the U.S. Federal Communications Commission (FCC) to create a national next-generation broadband plan.

Broadband service is viewed as a key factor to enable economic growth that can benefit a wide range of intrinsic services in areas such as telemedicine and management of transportation and energy systems. It can also greatly reduce infrastructure costs for businesses.

European nations support open-access policies to spur competition among service providers. Open access allows new companies to lease lines from a network owner. This has proven to be a highly effective method of promoting competitive pricing to the consumer market. Currently, both the U.S. and Canada have yet to adopt this policy. Both nations rely upon competition between cable and phone companies to develop better and cheaper services. The Beekman Center study concludes that this method is highly ineffective for the short and long term of the industry.

Canada's CRTC (Canadian Radio-Television and Telecommunications COMMISSION) did implement open access rules in 1997 but, by allowing network owners to charge the highest lease rates on the planet, the CRTC effectively hampered any positive development. With rates as much as 70% higher than some nations, open access did not progress in Canada.

With a rating that has continued to decline over the last decade, Canada must seek to revamp its broadband policy if it wishes to compete with the world.

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Friday, October 16, 2009

How Important are Credit Checks for your Small Business?

Imagine conducting business in an ideal world – a world where everyone is honest and truthful and the thought of cheating someone never enters the conscious mind. Nice fantasy but hardly reflective of our modern society.

Not to cast disparaging remarks on the average consumer. Most of us are honest and hardworking. We pay our taxes and our bills on time. However, many a small business owner has fallen victim to the customer who has been extended credit and fails to pay the bill, leaving the business owner absorbing the debt.

Credit, both extending and receiving, has become a way of life in our world. Truthfully, it is not a modern concept. Credit has existed probably for as long as commerce and trading. Similarly, the unpaid debt has probably existed equally as long. Today, though, there are modern tools to help afford the business owner a certain degree of protection.

The credit check is a tool that can save the business owner much grief and heartache. Before extending credit to an unknown customer, it is wise to invest in a credit report, especially if a large amount of credit is being considered.

A credit report, obtainable for a fee through several agencies, gives complete information about the customer. The report will include the customer's historical payment data, records of any bankruptcies, lawsuits, liens, or any other court judgments. Based on the data, the report will also offer a risk rating that predicts the likelihood of bill payment by the individual.

Credit in business is partially risk. Risk management, via a credit report, is an advisable investment for your business.
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Thursday, October 15, 2009

Rating Online Business: The Star Rating System

Many of us have been a victim of the stars. No, this doesn't refer to astrology. Rather, the star rating system that is prevalent on many internet shopping sites has led many a shopper astray.

One of the big questions is who determines how many stars a product or a site rates? Another thought is how accurate is the rating? Also, who monitors the accuracy and validity of these ratings?

In many instances, the answer to all three questions is identical: the owner of the site. This is not to say that all ratings are fabrications. Many websites are quite honest and respect the consumer market. However, there is no limit to sites that serve as clearing houses and have little or no control over who posts products or services for sale.

In reality, the star rating should be used to reflect an average of opinions from actual consumers. However, fears of honesty and good old fashioned greed have led many sellers to conduct virtual opinion polls of likewise virtual customers.

The truth is that it is highly unlikely that all products and services have top notch ratings. Even a superior product is bound to have its critics. On the other hand, studies conducted by market research groups have shown that 65 percent of word-of-mouth is positive and only 8 percent is negative. In other words, it is quite likely that many shoppers who have not been pleased by the product or service they purchased online may prefer to say nothing rather than spread negative feelings.

The bottom line is that a website is no different than a conventional store in terms of purchasing. Don't believe everything that you read. Do your own research. Speak to friends who have purchased that product or frequented the seller. Educating yourself is the best consumer protection.

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Wednesday, October 14, 2009

The Stepping Stones of a Start Up

So you've decided to start your own business. Good for you! Many think about taking this bold step but not everyone is sure how to go about setting onesself up in business. While there is no blueprint for guaranteed success, there are a number of steps that you should take into consideration when planning to establish your own business venture.

First and foremost, if the decision is yours, establish a business that you will enjoy operating. Considering the amount of daily time devoted to operating a business, it really should be a labour of love.

Don't get going with out a written business plan. This document will help you take a realistic look at your idea and examine its viability. You will also need it to attract potential investors.

Unless money is of no concern, try and get your business off the ground while you are still employed. Having a steady source of income while your business is still in its infancy can help keep your family housed and fed until your business start showing a profit.

Take the necessary time to research your ideas. In order to make a name for yourself, you should have all the know-how and answers. Be sure that you know what you are getting into and are well versed in the industry that you plan to enter. Also, don't be afraid to seek advice from others. Bounce ideas off colleagues and friends. Get feedback, both positive and negative. It's better to hear thoughts and opinions before the business is a reality.

Be sure to use qualified legal and accounting professionals in your planning. A seemingly small mistake, financial or legal, can cost you dearly. You may also need this information when writing your business plan.

Make sure that your financing is arranged before you hang out your shingle. Opening your doors and hoping to find the funds afterwards can be a serious error.

Finally, even during the planning stages, start selling yourself. Get customers lined up and make professional contacts. If you sell yourself well, you'll be ready to start business on day one. 

Tuesday, October 13, 2009

Common Mistakes of a Start Up

Most of us dream of becoming an overnight success. We have thought of the greatest business idea that will lead us to riches. It may happen. Then again, it may require good, old-fashioned hard work and dedication to make that first million. No doubt, though, that self employed entrepreneurs have that desire and drive to give it a try. By avoiding some common startup mistakes, the chances of success increase greatly.

It is vital to set yourself apart from others. You have to convince customers that your business is the right choice. What is your specialty that will entice business to come your way? Being the same as others in the trade won't cut it. Also, copying someone else's idea because they were successful at it won't bring you long term success.

You have to sell your service or product to the public. Don't expect a colourful flyer or flashy website to do the work. Similarly, your credentials are important for your credibility. But the bottom line is demonstrating what you can do with those credentials.

Did you start out with a business plan? Use this document to chart your business and don't be afraid to alter the plan as necessary. Many new businesses realize in the first few months that change is essential. Although you probably want to see your business in print, don't sink money into advertising until you've worked out the initial kinks and have settled on the long term version of your business.

Be sure to advertise your business where it counts. Get out and sell your service or product to the appropriate crowd. Also, don't let hecklers or criticism deter you. Setbacks happen. Don't let them overwhelm you. Marketing must be ongoing. Don't stop after a few tries. You want the public to identify you with your business. Continue the marketing and be persistent and convincing!  Motivate yourself and you'll succeed in motivating others. 

Monday, October 12, 2009

Advertising Advice for Small Businesses

Undoubtedly, you will invest a good deal of time spreading the word about your new business. However, business requires a degree of volume. Therefore, advertising is a necessity. There are a variety of ways to advertise your new business, beyond merely speaking to people.

Even in this age of the Internet, many people still open the Yellow Pages when looking for a business. Of course, remember that the more visible your ad, the better your chance of being seen.

Newspaper ads are not just the realm of the major players. Your business will begin its path from a local market and local newspapers are the economical and effective way to attract a customer base. Don't forget to have an advertisement prepared professionally. An amateur look could harm your professional image.

A new business should avoid costly telemarketing. On the other hand, direct mail may serve you well as you can choose exactly which geographic audience you are seeking.

Do you have a supply of eye-catching business cards? Each card is a miniature advertisement. Give them out freely to whomever you meet. Also, you may want to enlarge your card and prepare a sign to stick to your car. Remember, it is hard to say that you can advertise too much.

Of course, budgets do factor into advertising. The size of your advertising budget will determine how much you can allow yourself.

Be sure to get around to trade shows. Networking at shows and conventions is a very effective way to make contacts and get known "in the business."

If you can afford it, local cable television advertising and radio spots may work for you. Similarly, sponsorship of local events in your community will earn you positive recognition.

Be creative and continually seek new and creative ways to advertise your business. It doesn't always require a large budget to market your business. Do what's best suited for your budget and be persistent.

Sunday, October 11, 2009

Looking for Startup Money?

Money makes the world go 'round. It also gets your startup business up and running. Many a new business venture has failed due to a lack of cash to get the operation off the ground and get through the initial difficult months until the business starts generating revenue. Unfortunately, there are no guarantees as to where you will find the necessary capital. Many entrepreneurs tend to follow a similar path in seeking funds.

The most popular place to look is your own pocketbook. Often, people will mortgage their homes or sell property and possessions. Certainly, there is risk involved but business involves risk and personal commitment to the venture is crucial. Of course, "personal" funds may also extend to family and close friends. Most likely, they will be far more supportive than commercial lenders and their terms are likely to be far more favourable.

Next in line is your neighbourhood bank. Assuming that you have a creditworthy relationship, this may be the ideal place to secure a startup loan. Also, a line of credit is most important for your business. You may not need these funds initially but they may come in handy down the line.

Do your research well. There are numerous loans and grants available for new small businesses from government agencies and business associations. Your local banker or your accountant may be able to help direct you to sources of funds. Similarly, professional organizations may have helpful information.

Investors may be the right answer for you. Although many investors prefer to become involved with established businesses, the right idea at the right time may attract investment funds to you. Your business plan should be designed with investors in mind. Be prepared to change the business plan as necessary in order to interest a potential investor.

Finally, don't limit yourself to one source of funds. It may be possible for you to finance your startup form several sources. Decide what is best for your needs and don't be afraid to seek advice from professional advisors. 

Tuesday, October 6, 2009

Living Week by Week: Rough Economic Times for Canadians

The results of a new poll released this week by the Canadian Payroll Association revealed some surprising statistics and facts about the average Canadian household. A one week delay in receiving a paycheque would render nearly 60 percent of Canadians unable to pay their regular bills. Moreover, the same majority group has little or no ability to set aside money for retirement funds.

These surprising results have shed new light on the financial condition of many Canadian homes during these rough economic times. Despite common financial advice that people should have an emergency cash reserve for three months of expenses, the majority of households surveyed admitted that they are happy if they can make it to the next paycheque, let alone save for retirement or emergencies.

The younger workforce is in greater distress. 45 percent of workers aged 18 to 34 are feeling the crunch and feel that they are having trouble making ends meet. A delay in being paid would spell disaster. 72 percent of single parents responded in a similar fashion.

Regardless of age, the survey revealed that half of all Canadian workers are unable to save more than five percent of their net income for retirement. Financial planners recommend that ten percent is an advisable amount. However, the recent fluctuations in the stock markets have made saving for retirement far more challenging. Nearly one third of Canadians are trying to save more money but they can't. 42 percent admit that they aren't trying at all to save more.

Despite the variety and wide array of financial products being offered to Canadians by financial institutions nationwide, many Canadians seem pleased if they can pay their bills after payday.

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Monday, October 5, 2009

Canadian Recovery Indicators

Recent economic records this summer seem to indicate brighter days on the Canadian horizon. Earlier, analysts had predicted a $100 million surplus in July. The reality, though, was quite different. Rather than a surplus, Canada experienced a near record deficit in July 2009 of $1.43 billion. This was surpassed only by the May 2009 deficit of $1.45 billion. Despite these figures, economic analysts seem buoyed by the surge in imports. The sharp rise in imports and exports seem to indicate that recovery from the global financial crisis is on the horizon.

Import figures for July reflected an overall 8.3 percent increase from the previous month. This positive figure included a 10.9 percent increase in machinery and equipment imports, an impressive 18.7 percent rise in automotive products, and a similarly encouraging 18.6 percent rise in energy products.

Exports rose by 3.3 percent in July, primarily due to increased shipments of equipment, machinery, and automotive products. 73 percent of all Canadian exports in July were to the United States but, due to the sluggish American economy, this figure was down a whopping 35.2 percent from July 2008.

In order to stimulate the economy, the Bank of Canada has promised to leave interest rates at their current record low. The recent trade figures have not caused the Bank to change its current position. Responding to the Bank's announcement regarding interest rates, the Canadian dollar rose to 92.46 U.S. cents from 92.10 U.S. cents.

Analysts insist that the increasing deficit is not a prime cause of long term concern. The true indicator is the rapid acceleration in trade volumes. The rises in imports and exports indicate increased commercial activity and the true beginnings of economic recovery.

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Sunday, October 4, 2009

Joint Canada/B.C. Jobs Program

British Columbia has been seriously affected by the global recession. As a province with many communities heavily reliant on resource-based industries such as mining, agriculture and fishing and manufacturing, the job market is in a severe crisis. Responding to the needs of these western communities, the federal and provincial governments have banded together to create immediate jobs and help workers impacted by the recession.

A $14 million investment has been made recently through the Community Adjustment Fund and the Job Opportunities Program. 45 new projects will be funded, creating more than 470 jobs for laid-off resource workers. The projects are endorsed and supported by local communities. The programs are not stop-gap measures but will hopefully create foundations for long-lasting prosperity.

However, this is but one phase of a much larger program. The Job Opportunities Program was first announced in May 2008 with an initial investment of $25 million. In July 2009, the federal government and the B.C. provincial government, both committed to maintaining financial stability and keeping Canadians working during this recession, each committed an additional $30 million to the program. The Community Adjustment Fund, part of Canada's Economic Action Plan, is a two year, $1 billion nationwide program to support job creating projects and maintain employment in rural communities. Nearly one third of the program's funds, $306 million, are being directed to the four westernmost provinces of Canada. The impact of the recession has been felt much more in the west than other provinces across the nation.

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Saturday, October 3, 2009

How Canada Prepared for the Crunch

Looking back just a little, the current recession took hold in 2007 when the inflated U.S. real estate bubble exploded. The speed with which the downfall snowballed surprised many but did provide enough time for legislators to take early action. The Canadian government, under Prime Minister Stephen Harper, was one of the first to prepare for the coming financial challenges.

The first step was introducing legislation in 2007 for permanent tax reductions for Canadian homes and businesses. As the recession hit the U.S. in early 2008, these new tax cuts took effect, helping sustain consumer spending and pumping billions of dollars into the Canadian economy. The lower GST is a blessing for individuals who have more of their hard earned dollars to spend. Canadian businesses now benefit from the lowest corporate tax rate among G7 industrialized countries, providing cash for continued corporate growth and creating new jobs.

During the country's strong economic years in 2005-2006, the government wisely reduced the national debt by $37 billion. By entering this recession period with a low debt burden, the government has had flexibility to run a short term deficit and provide funds for job creating investments and other economic stimulus programs.

Another preventive measure undertaken by the Harper government was regulating the mortgage market. The maximum term was reduced to 35 years and a minimum 5 percent down payment is required for government-backed mortgages.

Finally, responding to a cautious banking sector, the government has enacted programs to provide access to financing for consumers, households, and businesses. The government has not replaced private lending but, rather, is working in a cooperative effort with financial institutions to encourage lending and provide a network of guarantees.
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Friday, October 2, 2009

Credit Now Available From The Federal Government

A person needs oxygen to survive. A business needs credit. Even in the most difficult of times, the flow of oxygen remains uninterrupted. Not so, however, with credit.

Many a business has seen its line of credit be reduced or cancelled over the course of the last year. Financial institutions, seeking to reduce risks on unsecured or unstable credit lines, have made obtaining funds ever more difficult. This move has dealt a crippling or death blow to many small businesses in Canada.
Under Canada's recent Economic Action Plan, designed to stimulate and strengthen the Canadian economy, the Federal government is sponsoring a program that will work with financial institutions in the private sector. The Business Credit Availability Program (BCAP) will provide loans and other forms of credit support to creditworthy businesses. At least $5 billion has been allocated in loans and other forms of credit support for business enterprises with viable business models but, for various reasons, have limited or no accessibility to financing.

The BCAP is a joint venture between two financial Crown corporations and private Canadian financial institutions. The steering committee is comprised of senior representatives of all sponsoring parties whose experience and commitment have establishes a program with initial promising results. Similar to credit issues, discussions are also being conducted to examine ways of providing accounts receivable insurance.

Business owners and entrepreneurs seeking assistance through this program to support their established operations and preserve jobs should contact their financial institutions to discuss their needs and eligibility. Your financial representative can advise you which program is best suited for your particular situation.
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Thursday, October 1, 2009

Is Canadian Employment on the Rise?

Statistics are like a cat. Rub its fur one way and it purrs; rub the other way and the results are somewhat less positive.

So it is with employment figures released by Statistics Canada for the month of August 2009. Stephen Harper's Conservative government is giving a positive spin to the 27,100 net jobs gain for the month. The announcement triggered an eight-tenth of a cent rise in the Canadian dollar, although higher crude oil prices may also have influenced the dollar's rise. Some leading economists have announced that this is an indication of the end of the recession. All this sounds rather encouraging.

Critics, though, are quick to note that many Canadians are not feeling quite as positive. Most of the new jobs were part-time only. The number of unemployed rose in August by 21,900, bringing the total number of unemployed Canadians to 486,000 since the global financial crunch of October 2008. The decline in the manufacturing sector has continued, although construction has begun to stabilize. Most of the new part-time jobs were in the lower paying service sector. Higher paying, high productivity work fell by 17,300 positions. Full-time work continues to be in a decline.

Certainly, there is cause to be optimistic. As one economist stated, half a job is better than no job. Economic indicators seem to point in a positive direction. But, one month of net growth may be far too early to establish a positive trend. Canada may well be on its way to economic recovery. Nearly half a million unemployed Canadians certainly hope so.

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