February 14, 2001 Volume 4 Number 2
CONTENTS
* Introduction - Editor's Comments
* What's New at www.gdsourcing.ca
* Statistics Canada releases
* Researching a Manufacturing Business
* Small Business Stats Facts
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INTRODUCTION - EDITOR'S COMMENTS
Hello,
Welcome to this issue of the BR Newsletter.
I would like to start by letting you know the paper version of our
research guide "Researching a Small Business 2000" is now sold out. You
can still purchase electronic copies of the guide at our web site:
https://www.gdsourcing.ca/gdstart.htm
We will not be producing any more print versions as we are currently in
the midst of updating and expanding the guide. We hope to have the 2001
issue available in May of this year.
The Toronto Business Development Centre has released its January to
June seminar schedule and I am booked to speak on two more occasions on
Marketing Research & Analysis. The dates are April 3rd and June 5th. Both
are Tuesday nights at 6:30 to 8:30. Free parking. Contact the TBDC for
more information 416-345-9437.
I hope you find this issue useful.
Thank you for your subscription.
John White
Editor, BRN
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WHAT'S NEW AT www.gdsourcing.ca - ACCOUNTANTS,
HAIR LOSS & HOTELS
The following web sites were added to the GDSourcing index over the
last three weeks. GDSourcing is a reference point for free Canadian
statistics on-line.
Canadian Hair Research Foundation
http://www.hairinfo.org/
(For links to data see our site summary
https://www.gdsourcing.ca/works/Hair.htm)
- Canadians believe hair loss makes it harder to get a job
Canadian Institute of Chartered Accountants
http://www.cica.ca
(For links to data see our site summary
https://www.gdsourcing.ca/works/Accountants.htm)
- Personal Income statistics and analysis
- Winning with e-business - Summary Report (Key findings from an Angus
Reid survey assessing the e-business readiness of small and medium-sized
Canadian businesses.)
Colliers International Commercial Real Estate
http://www.colliers.com/
(For links to data see our site summary:
https://www.gdsourcing.ca/works/Colliers.htm)
- Commercial/Industrial Real Estate Report
- Hotel Real Estate Report
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STATISTICS CANADA RELEASES
The following statistics were release by Statistics Canada over the
last three weeks. We have listed those releases we feel are of the most
interest to Canadian entrepreneurs.
Very few of these statistics are available on-line. The URL listed is a
direct link to the press release associated with the data. It provides
contact and ordering information.
AGRICULTURE
Chicken production 2000 (preliminary estimates)
http://www.statcan.ca/Daily/English/010207/d010207d.htm
Farm product prices January to December 2000
http://www.statcan.ca/Daily/English/010208/d010208h.htm
Rural youth migration between 1971 and 1996
http://www.statcan.ca/Daily/English/010207/b010207a.htm
BUSINESS & SCIENTIFIC SERVICES
Engineering services 1998
http://www.statcan.ca/Daily/English/010202/d010202c.htm
Real estate rental and leasing and property management service industry
1998
http://www.statcan.ca/Daily/English/010201/d010201f.htm
COMPUTER SERVICES
Computer systems design and related services, software publishers, data
processing services, on-line information services 1998
http://www.statcan.ca/Daily/English/010202/d010202b.htm
CONSTRUCTION
Building permits Annual 2000 and December 2000
http://www.statcan.ca/Daily/English/010207/d010207a.htm
CULTURE & ENTERTAINMENT
Arts, entertainment and recreation 1998
http://www.statcan.ca/Daily/English/010208/d010208g.htm
Television viewing Fall 1999
http://www.statcan.ca/Daily/English/010125/d010125a.htm
Government expenditures on culture 1998/99
http://www.statcan.ca/Daily/English/010125/d010125b.htm
EDUCATION
Benchmarking Adult literacy in North America 1994 to 1998
http://www.statcan.ca/Daily/English/010208/d010208b.htm
Full-time enrolment in trade/vocational and preparatory/special
training 1997/98
http://www.statcan.ca/Daily/English/010130/d010130e.htm
ECONOMIC INDICATORS
Financial performance indicators for Canadian business 1999
http://www.statcan.ca/Daily/English/010130/d010130b.htm
ENERGY
Domestic sales of refined petroleum products Annual 2000 and December
2000 (preliminary)
http://www.statcan.ca/Daily/English/010201/d010201b.htm
Coal production 2000 (preliminary)
http://www.statcan.ca/Daily/English/010130/d010130h.htm
Oil and gas extraction 2000 (preliminary)
http://www.statcan.ca/Daily/English/010130/d010130i.htm
GOVERNMENT
Local government enterprises, income and expenses Fiscal year ended
nearest to December 31, 1998
http://www.statcan.ca/Daily/English/010124/d010124e.htm
HOSPITALITY
Traveller accommodation statistics 1998 (preliminary)
http://www.statcan.ca/Daily/English/010208/d010208f.htm
JUSTICE SERVICES
Hate crime 1999
http://www.statcan.ca/Daily/English/010124/d010124f.htm
RETAIL/WHOLESALE
Department store sales and stocks December 2000 and 2000 (preliminary)
http://www.statcan.ca/Daily/English/010205/td010205.htm
Retailing in Canada 1998
http://www.statcan.ca/Daily/English/010205/d010205d.htm
Retail Chain and Department Stores Survey 1998
http://www.statcan.ca/Daily/English/010201/d010201g.htm
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RESEARCHING A MANUFACTURING BUSINESS
The manufacturing sector accounts for 17.9% of the Canadian economy. It
involves everything from the production of automobiles and steel punches
to handcrafted pet accessories and high tech water purification devices.
Given this range, you can appreciate that this article can only touch on
the very basics of researching a manufacturing operation.
Although every manufacturing business has its own unique research
needs, there are a few key resources of use to every type of manufacturer.
You first need to determine your Canadian Standard Industrial
Classification number. SIC is a 4-digit coding system designed to classify
all types of businesses in Canada. There is a new North American Industry
Classification System but as yet its implementation in published data is
limited. Within a year this system should be in wide spread use.
For now you can conduct a keyword search for your SIC code at the
Industry Canada web site:
http://strategis.ic.gc.ca/sc_ecnmy/sio/homepage.html
For full definitions of each SIC code see the Statistics Canada web
site: http://www.statcan.ca/english/Subjects/Standard/sic/sice80-menu.htm
Once you know your industry code, start your research with the Canadian
Industry Statistics section at the Industry Canada web site:
http://strategis.ic.gc.ca/sc_ecnmy/sio/homepage.html
This section contains detailed statistical profiles organized by
4-digit Standard Industrial Classification codes. The data covers industry
structure, international trade, sector level performance and key players.
The data for these profiles is sourced from Statistics Canada and is
combined with Industry Canada estimates to ensure that data is as current
as possible.
Another manufacturing resource at the Industry Canada Strategis web
site is the "Guides to Canadian Industries". (See
http://strategis.ic.gc.ca/sc_indps/gci/engdoc/homepage.html) Much of
the information provided is generic in nature however the guides do
identify relevant industry associations.
The Industry Canada Strategis web site also has a section called
Information by Business Sector.
http://strategis.ic.gc.ca/SSG/tm00111e.html
This section is organized alphabetically and includes government and
non-government data and reports. Not every manufacturing sector is covered
in this section but those that are included are well represented.
Import and export are key factors within the manufacturing sector.
Whether or not your business is planning to export you must understand and
acknowledge the affect that imported products will have on your market
share. Start by looking at the Trade Data on-line web site:
http://strategis.ic.gc.ca/sc_mrkti/tdst/engdoc/tr_homep.html
The database can be search by Industry (SIC) or by Commodity (HS -
Harmonized System). A helpful feature of this database is that when you
search by industry you can examine the growth in the Apparent Domestic
Market. Apparent Domestic Market is calculated by adding the value of
total manufacturers' shipments to the total value of imports and
subtracting the total value of exports. The data should be used with
caution but it can be a quick gage of apparent market growth.
You will also want to examine individual commodity import and export
figures. The database allows you to search by province and individual
country / U.S. state for the last five years.
A related database at the Industry Canada Strategis web site is the
Canadian Importers Database.
http://strategis.ic.gc.ca/sc_mrkti/cid/engdoc/index.html
It allows you to determine the total value of imports of a particular
product (10-digit HS code) and the market concentration among importers.
It also provides a list of "Major Importers" who collectively account for
the top 80% of all imports (in terms of $ value) of a selected product for
all of Canada. This list does not include individuals. Keep in mind
however that the importer is not necessarily the end-user of the product.
The Statistics Canada web site does not have as detailed information as
the Industry Canada sources. There are however two features that provide
the most current manufacturing data available. Both can be found in The
Daily, Statistics Canada's principle media release vehicle and can be
purchased through the CANSIM database.
The first is the Monthly Survey of Manufacturing. The timeliness (2
months from collection to publication) of this survey makes it a vital
tool for any manufacturer. It is a quick acid test of the current strength
of the sector as a whole.
If you want to consult previous issues or wish to find releases in the
future, use The Daily's search engine. (See
http://www.statcan.ca/english/search/daily.htm) Under "Search For"
change "All these words" to "The phrase" then type in "Monthly Survey of
Manufacturing".
Industry detail is not available in the news release but you can
purchase it from the CANSIM database for $3 per industry. Data is
generally available by 2 digit SIC although in some cases 4-digit detail
can be accessed. You receive the entire time series back to 1982 when you
purchase this data.
The following data sets are covered:
Value of Shipments
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=9550
New orders
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=9552
Unfilled orders
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=9554
Raw Material Costs
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=9558
Value of Finished Goods
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=9562
Inventory Owned
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=9564
Ratios: Total Inventory owned to Shipments and Finished Products to
Shipments
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=9568
Value of Shipments by Province
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=9570
If you use the non-seasonally adjusted data you can use the time series
to identify seasonal trends within your industry. All the Internet
addresses listed above connect to non-seasonally adjusted data. If you
want to consult seasonally adjusted data click on "next matrix" at the top
of the above pages.
The second timely survey manufacturers should consult is the Quarterly
Business Conditions Survey: Manufacturing Industries. This survey covers
production prospects, expectations on the level of orders received,
unfilled orders and skilled labour shortages.
As before, if you want to consult previous issues or wish to find
releases in the future, use The Daily's search engine. (See
http://www.statcan.ca/english/search/daily.htm) Under "Search For"
change "All these words" to "The phrase" then type Quarterly Business
Conditions Survey".
Industry Specific data is not provided in the news release. However you
can purchase data for selected trade groups through the CANSIM database.
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=2844
A trade group refers to a 2-digit SIC number. The first two numbers of
the "series number" in the CANSIM database identify the trade group. The
charge for this data is $3 per time series. You receive the entire time
series back to 1981.
If you have a limited budget you can minimize your costs by only
choosing those variables you are interested in. (e.g. If you only focus on
negative indicators ($3 x 5 = $15) you know that the outstanding
percentage of manufacturers responded that the variable was expected to be
the same of better in the near future. The entire data set costs $45 ($3 x
15).
It is important to look at the expectations of your specific trade
group when possible. The overall indicators mentioned in the news release
can be deceptive. For example newspapers recently reported "a stunning
loss of confidence among Canadian manufacturers" when the 1st quarter 2001
expectation survey results were released. Yet this decline in confidence
(43% of manufacturers stated they would decrease production in the first
quarter) was due almost entirely to two trade groups: transportation
equipment (mostly automobile manufacturers) and primary metals industries
(most steel manufacturers). While these two sectors are key to overall
economic growth, they do not necessary reflect the outlook of your sector.
With this database you can also examine provincial outlooks however no
trade group detail is provided:
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=2845
If you want to examine industry forecasts beyond the next quarter, you
are best to consult the economic reports produced by Canada's major banks.
While all of them produce regular economic reports that provide provincial
and industrial forecasts, the reports available on-line from the Bank of
Montreal are the most detailed from a manufacturers point of view.
http://www.bmo.com/economic/econ.htm
Especially look at the report "Prospects for Canada's Industries to
2004" listed on the above page
Other Canadian Bank economic sections include:
TD Bank
http://www.tdbank.ca/tdeconomics/economic_forecasts/index.html
CIBC
http://research.cibcwm.com/res/Eco/EcoResearch.html
Scotiabank
http://www.rbc.com/economics/index.html
Royal Bank
http://www.rbc.com/economics/index.html
(For whatever reason the Royal Bank has decided their forecasts are so
special you have to be a customer with a username and password to access
them!)
Price fluctuations are very important to every type of manufacturer.
This data tells you the current trends affecting the price of your
product. Use the Statistics Canada publications Consumer Prices and price
indexes (cat#62-010) and Industry price indexes (cat#62-011) to assess
those prices most relevant to your business. The Industry price
publication includes price indexes for both raw materials and finished
goods. This information is vital for predicting cash flow and profit
margin. For the most detail available see CANSIM matrices:
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=1871
http://www.statcan.ca/cgi-bin/Cansim/cansim?matrix=9957
One of the best on-line resources for finding manufacturing market data
is the Tradeport web site: http://www.tradeport.org/ts/ (click on market
research). This web site contains market research reports compiled by the
U.S. government to help its own entrepreneurs export into foreign markets.
Canadian entrepreneurs can use the market research reports on Canada to
assess domestic demand. While the reports do not cover every type of
product manufacturered, there is some very specific information contained
in this database. For example there is a report on Paper Recycling
Machinery in Canada.
To find out if any reports are relevant to your research needs, you can
conduct a keyword search by specific country. Keep in mind however, that
this data does not cover the United States.
For U.S. market research reports, you should consult the Canadian
department of Foreign Affairs and International Trade web site:
http://www.dfait-maeci.gc.ca/trade/menu-e.asp
They have a number of reports available covering various products and
regions within the United States. Foreign Affairs also has information on
other markets around the world and tips on how you can access them.
While all the sources listed above provide a great deal of information
it is likely that few of them will address your specific product. In order
to focus on your specific product you need to conduct a media search of
related articles and to talk to people in your market and industry.
A good place to start your media search is Canada newswire.
http://www.newswire.ca/
It will provide you with a list of publicly traded companies active in
your industry and market as well as alert you to any related studies or
reports that have been released by associations or research organizations.
If you find any publicly traded companies active in your market consult
their annual reports. In the "management discussion and analysis' section
you will often find insights into current trends and factors influencing
your market as well as industry forecasts.
Do not just look for competitors but potential customers and related
products and services. The better you understand your customers, the
better you will know how to provide them with the products they need.
We strongly recommend that you use Canadian information first and
foremost. Canadian corporate documents can be found at
http://www.sedar.com/
U.S. corporate documents can be found at Free Edgar
http://www.freeedgar.com/
Each specific manufacturing sector also generally has a related
industry periodical. Articles within these publications often focus on
specific products.
We can not possibly list all relevant publications within this brief
article. The Rogers Media site Bizlink (
http://www.bizlink.com/) provides
access to a number of Canadian business periodicals but their list is by
no means exhaustive. A general media search can often help you find
related publications or at least contacts that might be able to suggest
some to you.
You will also want to conduct a general media survey as well. Many
manufacturing companies are publicly traded and so this sector receives a
great deal of coverage in business sections of newspapers.
Start your on-line search at the Globe Investor web site (http://www.globeinvestor.com/).
We recommend you contact the Industry Association most closely related
to your product line. It is true that many associations do not collect
statistics on their industry, but there are also quite a few that are very
active in helping their members understand their market and sector. Many
have data published at their web sites. A good example is the
Nonprescription Drug Manufacturers Association of Canada. Their web site (http://www.ndmac.ca/)
has many studies and articles published on this unique market.
While published data is essential to understanding the true nature of
your market and industry, nothing can substitute talking to people within
your sector. They can provide you with insights based on experience. Do
not simply conduct a survey. Have a conversation and start networking
yourself and your business. Often a good way to start a conversation is to
mention some of the data your have already sourced and ask someone their
opinion on it. People love to give their opinion!
Finally we always recommend that manufacturers of consumer related
products examine the performance of related retailers. We will examine
sources for researching the retail market in a future issue of the BR
Newsletter.
For more research advice please see our research guide: Researching a
Small Business in Canada
https://www.gdsourcing.ca
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SMALL BUSINESS STATS FACTS
Each Business Researcher Newsletter ends with a collection of five
statistics that every entrepreneur should be aware of.
1. What were the top five service-based small businesses in Canada in
1999 ranked by median rate of return on assets?
1. Offices of other social service practitioners.....31.3%
2. Offices of other health practitioners.............28.7%
3. Offices of physicians, general practice...........23.8%
4. Offices of physicians and surgeons, specialists...23.2%
5. Medical laboratories..............................22.7%
Source: Statistics Canada (2001)
2. What were the top five goods-producing small businesses in Canada in
1999 ranked by average rate of return on assets?
1. Other exterior close-in construction work...............13.6%
2. Steel pipe and tube manufacturing.......................11.5%
3. Primary glass and glass containers manufacturing........10.9%
3. Telecommunication equipment manufacturing...............10.9%
5. Communications and energy wire and cable manufacturing..10.7%
Source: Statistics Canada (2001)
3. What province saw the fastest increase in the number of small
businesses (less than 100 employees)?
GEOGRAPHY...1997 COUNT.....2000
COUNT.....% INCREASE
1....Alberta......................114575........127207..........11.0%
2....Ontario......................309334........329844...........6.6%
3....Northwest
Territories..........2139..........2254...........5.4%
4....Prince-Edward-Island...........6706..........7050...........5.1%
5....New
Brunswick.................26750.........27651...........3.4%
6....Manitoba......................34176.........35294...........3.3%
7....Quebec.......................233186........240576...........3.2%
8....Nova
Scotia...................30295.........31224...........3.1%
9....British
Columbia.............150976........154217...........2.1%
10...Yukon
Territories..............1642..........1677...........2.1%
11...Newfoundland..................17307.........17489...........1.1%
12...Saskatchewan..................40320.........40730...........1.0%
Source: Statistics Canada
4. What Census Subdivision / Community in Canada saw the fastest
increase in the number of small businesses (less than 100 employees)?
(Only communities with 1000 business or more were compared)
GEOGRAPHY....1997 COUNT.....2000 COUNT.....% GROWTH
1....Strathcona County, AB....2106.........2519...........19.6%
2....Caledon,
ON.....................1269.........1513...........19.2%
3....Whitby,
ON......................1411.........1668...........18.2%
4....Victoriaville,
PQ...............1366.........1576...........15.4%
5....Verdun,
PQ......................1024.........1174...........14.6%
Source: Statistics Canada
5. What are the top five business opportunities in 2001 according to
Profit Magazine?
1. Personal coaches: someone to organize our lives
2. Sex toys: accessories that enhance the romance
3. Teen gadgets: video games, anything wireless
4. Outsourced business services from distribution to Internet
strategy
5. Specialist financial advisors, from tax experts to lifestyle
confidantes.
Source: Profit Magazine Dec/Jan 2001
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