Planning ahead and following a conservative budget is key to the survival of many businesses, attendees at a session of the Winnipeg Chamber of Commerce heard Thursday.
“We’ve just gone through two years of some of the toughest days in many generations,” chamber president Loren Remillard said in a pre-meeting interview.
The province’s public health restrictions are easing, allowing businesses in contact with the public to resume pre-pandemic-style operations. However, Rémillard considers himself optimistic with “an asterisk”.
“I go back to the Great Depression (as) the last time, I think, the world took such an economic hit that we just went through,” he said. “And there’s no guarantee that we’re completely out of the woods.”
Even if the pandemic turns into an endemic state, entrepreneurs are faced with huge debts, limited staffing and soaring inflation.
“If inflation is not brought under control, it can lead to a prolonged period of economic difficulties,” Rémillard said. “Consumer confidence (could) maybe pull back a bit, which would be absolutely detrimental to so many businesses that really need consumers to come back in droves.”
Business operating costs have skyrocketed along with the price of goods and transportation. Last week, Statistics Canada announced that the country’s year-over-year inflation had topped 5% for the first time in three decades.
“Every conversation I have takes inflation into account, regardless of how the company is performing,” Remillard said.
For contractors, the months and year ahead will be a balancing act between managing rising costs of goods and labor while keeping prices competitive, Remillard said.
“Those who are able to handle it will succeed, but some just can’t,” he said.
The chamber hosted a financial forum on Thursday highlighting advice for businesses to balance their books.
“As small business owners, we are forced to reimagine the way we operate and think about our day-to-day cash flow because things change from minute to minute,” said Kristine Tubiera, chat co-host and founder of LMVA Consulting.
Jerod Rathbone, corporate account manager for RBC, preached planning when he took the virtual stage.
“The last thing we want to do is stress more,” Rathbone said. “You can reduce your stress and anxiety by having more detailed or better structured plans.”
It starts with writing down goals — about revenue, scale, or whatever the entrepreneur chooses — and using those goals as targets to establish a set budget.
Including inflation in budgets is key right now, as is having multiple vendors on hand, should one fail, Rathbone said.
Constantly reassessing goals and finances — and planning with a conservative focus — will create a level of “belief, comfort, or confidence,” Rathbone said.
“(I’m) really encouraged to hear you come back to the words comfort and confidence so often, because I think those are things that small business owners are looking for,” said Larissa Peck, session co-host and co-host. -founder of Tandem. Collaborative.
Control was a theme in Thursday’s chat. Entrepreneurs can’t control everything, including customer decisions, but they can tailor their company’s messaging, which they should, Rathbone said.
He encouraged seeking advice from professionals, including bankers — “don’t try to reinvent the wheel,” he said — and to view lines of credit as a privilege, not a right.
“You kind of need to get it when you don’t need it and then have it when you do,” Rathbone said. “(We’ve) had customers come to us and say, ‘Things are bad; I now need flexibility or access to capital”…They hadn’t prepared their business in a way that they could sustain it, and that’s a really tough conversation.”
Talking to financial institutions early and often is important, Rathbone said.
The Winnipeg Chamber of Commerce surveyed its members last month to take the pulse of business in the city. Fifty-five percent said they were doing the same or worse than last year, according to Remillard. Twenty percent said they were facing tougher times than the previous quarter.
Fifty-six percent wanted more sector support from the government.
Gabby is a huge fan of people, writing and learning. She graduated from Red River College’s Creative Communications program in the spring of 2020.
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