You may have noticed recently that many businesses are closing their doors. These are the places you love, that you’ve known for years, in some cases decades, that are now being forced to close. why What is going on?
Closings are mounting: Cocoa Village and Agatha, Juliette & Chocolate restaurants, Piso jewelry boutiques, Baker Le Fromentire in Montreal, Creme (new window) Pastry Shop, Racer Center, Dero and more.
Boulangerie Chicoutimi-Nord, a true institution for more than 60 years, remains in the same situation in the region in Saguenay, as are many other restaurants, including Cafe Plantes et Fleurs and L’Gros Luxe in Chicoutimi. , cheese factories and microbreweries without number are struggling.
The reasons are many and complex, but in many cases, they add up. The loss of support linked to Covid-19 has left many feeling debilitated SMEs The epidemic may have been struggling before it began.
High inflation, rising interest rates and disruptions to supply chains have hit businesses hoping to benefit from a life-saving economic recovery after the pandemic. Didn’t go as planned.
Many entrepreneurs complain about regulatory requirements. For example, the Act on the Protection of Personal Information imposes new requirements on businesses that come into force on Friday 25 Many people are not ready for the deadline and there is a certain panic. The Canadian Federation of Independent Business (CFIB) estimates that this regulation costs the private sector $52 million annually.
Some talk about municipal taxes that are too much for their taste, permits that are difficult to obtain, or the elimination of certain commercial streets. Criticisms aimed mainly at the Valérie Plante administration in Montreal include changes in direction or occupation of certain routes and the addition of parking meters or residential parking zones.
Many companies are heavily indebted or unable to adapt to competition, which is tougher and better meet consumer expectations. The habits of these consumers have also changed as the pandemic and some companies have not recovered.
As you can see, there are many reasons to close some SMEs And the storm was not perfect for some entrepreneurs.
Sold out
I think all of these bankruptcies and closings have one thing in common: exhaustion. Many entrepreneurs can’t take it anymore, tired, exhausted, empty, Buttocks.
Is Canada’s economy minister proud to have won a gold medal for bankruptcy?
official opposition finance spokesman Frédéric Beauchemin asked during question time in Quebec’s National Assembly on Wednesday morning.
This is a very harsh observation, which is not shared by the Economy Minister. Pierre Fitzgibbon rejected the MP’s views and emphasized that During the pandemic, there was about a 24% reduction in business closures. Then, we saw an increase in closures since the end of the pandemic. If we take the average from 2020, we are below the level of closures we had before the pandemic.
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The Ministry of Economy clarified this information on our request. Thus, in the first 7 months of the year, there were 1,456 bankruptcy filings in Quebec. At this rate, if the trend continues, 2023 will be the worst year since 2017 SMEs.
Liberal MP Frédéric Beauchemin confirms that in the past year, 61% of bankruptcies in the country occurred in Quebec. If we are to believe data from Canada’s Office of the Superintendent of Bankruptcy, the number of business bankruptcy filings in Quebec increased by 20% from July 2022 to July 2023, reaching 1,879 bankruptcies. This number, in fact, equates to 61% of the 3,097 bankruptcies in the country.
Hard to honor repayments
Hence, it is clear that the financial health of many companies is at stake. This is why the federal government has decided to extend the repayment deadline for the Canadian Emergency Business Account. Loans granted during the epidemic period will have to be repaid this year.
According to CFIBAlmost 7 SMEs Canadian girls as young as 10 have yet to start paying off their loans. Only 18% of them have already managed to repay everything. there CFIB It also says 19% SMEsOr 250,000 businesses in the country could cease operations by 2024 if the repayment deferral is not extended further.
We should not underestimate the storm that is hitting our businesses. Misfortunes have been piling up for more than three years, and the current recession isn’t going to help matters. Canada is already in recession and Quebec’s growth is at zero, Finance Minister Eric Girard confirmed to us on Tuesday.
