As we approach the final quarter of the year with pandemic-related restrictions easing across the country, it’s clear that business owners are increasingly optimistic about the coming months.
Earlier this summer, American Express launched the Global Business Spend Indicator (GBSI), a new survey of global businesses conducted with the Centre for Business and Economic Research (CEBR). The survey, which revealed signs of renewed confidence in the 2021 economic outlook, leveraged data from more than 3,600 companies across Australia, Canada, Japan, Mexico, the UK and the U.S. to provide holistic insight into the diversity of perspectives and experiences that exist within the business population.
The survey also revealed a series of trends among B2B operators that are influencing the way business will be carried out in 2021 and beyond. Here are a few to consider for your own business:
Technology was one of the fastest growing categories in the first half of 2021. As the COVID-19 pandemic necessitated new strategies for serving customers, businesses sought technology that could increase efficiency in a safe manner. Among the fastest growing items in the technology category, automation came out on top as more businesses adopted digitization methods. Now more than ever, business owners need to embrace automation to remain nimble and competitive, maintain operations, and effectively serve their customers.
Though the digitization of B2B payments has been on an upward trend for years, the pandemic clearly accelerated this further. Next, look out for ecommerce technology to take off even more. As consumers continue to shop online and via social media, we can see an increase in spending on ecommerce platforms by an average of 6.9 per cent between Q4 2020 and Q2 2021, as revealed in the survey. By getting onboard with this ecommerce trend, businesses can reap many benefits, including lower operation costs and reach new customers.
2. Flexibility and Simplification
Not only did the COVID-19 pandemic necessitate a widespread adoption of new technologies to enhance safety measures and keep operations running, it also readjusted priorities. Many businesses aimed to streamline supply chains and operating practices. Among the most important considerations for Canadian businesses is flexibility of payment terms, which nearly 40 per cent of Canadian businesses put among their top priorities during the pandemic. Over the past 12 months, one-fifth (20 per cent) of Canadian businesses have simplified their network of suppliers and 30 per cent have looked for lower cost items and suppliers.
For Canadian businesses, this points to the need for flexible, easy-to-use payment technologies such as those provided by American Express Canada.
3. Credit Cards Preferred to Cash
Over the last decade, the move away from cash to card payments has steadily increased more and more each year. It’s not surprising then that this remained true during the pandemic, a period that required Canadians to use contactless forms of payment over cash, at least in the early months of the health crisis. According to the GBSI survey, nearly one-third (33 per cent) of Canadian business spending is carried out using credit or charge cards. While similar uptake in card spending exists around the world, this data represents the highest share out of any of the six countries analysed in the GBSI survey, making this a particularly Canadian data point.
By switching from check or ACH payments to Card, business owners can more easily manage their cash flow with options on extended payment terms and easily increase the spending capacity on their Card by asking for a spend review or getting access to greater funding.
While the shift away from cash isn’t completely over, with physical payment methods like cheque payments still accounting for 28 per cent of spending in Canada, Canada-based survey respondents estimated the use of cash will continue to decline by nearly 11 per cent over the next year.
4. Remaining competitive a top priority
As Canadian businesses look to rebound and adjust to the post-pandemic business landscape, many are focused on remaining competitive. In fact, it is the top priority for more than a third (36%) of owners, as surveyed in the GBSI.
Looking ahead to the next 12 months, it will be important for owners to test and establish new business operating models to bring their businesses to the next level. Innovation is necessary to not only to remain relevant, but also survive the changing nature of business demands. This could mean implementing a new process, improving customer experience, or by launching a new product. Employing business innovation will help your venture stand out in a crowded market and remain a competitive player within your industry.
This article is intended for general informational purposes only and does not constitute legal advice or an opinion on any issue. It should not be regarded as comprehensive or a substitute for professional advice.