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Big majority of Canadian companies have positive outlook: CIBC poll

The vast majority of Canadian business owners are optimistic about the future, but have no plans to grow businesses, according to a new survey by CIBC.


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October 14, 2014 by Canadian Plastics

The vast majority of Canadian business owners are optimistic about the future, but have no plans to grow businesses, according to a new survey by CIBC.

 

The online survey of 800 owners and managers found that 84 per cent have a positive outlook for their businesses, while about 44 per cent say their financial standing is better today than it was a year ago.

 

Yet despite the optimism, only about a third (37 per cent) are counting on expanding their businesses in the next three years, the survey found.

 

A majority (79 per cent) of those polled also say they are sitting on cash reserves, with 40 per cent saying they’re not earning any interest on this cash – and of those who do plan on expansion, 60 per cent say they won’t be using these cash reserves. Instead, they’ll use credit cards, loans or money out of their own pocket to fund their company’s growth.

 

“While many businesses do have cash on hand, most tend to see it as a rainy day fund they can access in the event they have a slower month with their cash flow or have an unforeseen emergency,” said Shelley Swanlund, vice-president of business banking and the head of small business at CIBC. “But this effectively leaves these funds on the sidelines rather than supporting the business. As a result, many business owners turn to their personal finances to fund expansion plans, which may limit the capital they have available.”