Oil prices are depressed. There’s still volatility in Europe. And while the U.S. market is picking up, the Canadian market is showing signs of running out of steam. World trends like these can have an impact on your business, or open the door to new opportunities. But if you’re a small to medium-size enterprise (SME), how can you analyze the maelstrom of information to make sound business decisions?
Fortunately, there are several ways enterprises can access market intelligence, often at no charge, says Stuart Bergman, Deputy Chief Economist and Director of Economic and Political Intelligence at Export Development Canada (EDC). “In a global economy, it’s increasingly important to have global market intelligence. EDC, the Trade Commissioner service, the Canadian Commercial Corporation and the Business Development Corporation are just a few of the government resources that offer a wealth of information on their websites, and through webinars, seminars and networking events.” A downloadable exporting tool kit outlines the information and services each organization offers.
Whether you’re new to market research or you want relevant economic forecasts to help guide your decisions, Bergman recommends the Global Export Forecast (GEF), as a good place to start.
“You may see on the news US housing starts are up and oil prices are down, and wonder how that will affect your business,” says Bergman. “The Global Export Forecast analyzes major world events and how they are expected to impact the global economy, as well as the opportunities and risks for Canadian exporters.”
Bergman adds the report is packed with numbers and statistics for those looking for quantitative market analysis, but includes easy-to-read commentary and a clear executive summary that makes the document accessible to all.
Spring 2015 GEF’s silver linings
In the Spring 2015 GEF, Chief Economist Peter Hall offers words of encouragement for Canadian businesses, noting that while growth has been elusive since the 2008-09 global crisis, “…we have not been knocked off our game by impossible fiscal chasms, financial market carnage, waves of political upheaval, experimental policy measures and a host of smaller but significant inhibitors.”
Keeping that optimism may be a challenge now that Canada is facing higher levels of consumer debt, lingering austerity at the provincial level, and plunging prices for resource industries. But on the brighter side, Hall outlines how some global trends may offer new opportunities.
- The economy of Canada’s number-one customer, the US, is going full-tilt and its success is catching on. After several years of pinching their pennies and holding off on major purchases, American consumers are now ready to spend. “The difference for the US economy is the presence of an essential ingredient–pent-up demand. It is probably most obvious in the US housing market,” Hall explains, adding that the housing market will show remarkable growth over the next year or two just to meet current needs. The surge in housing is expected to swell consumer spending for a wide range of products, thus creating jobs and pushing corporate spending as companies scramble to meet increased demand. For Canadian exporters, this should not only re-open the American market for them, but other global markets as well, since American consumers account for 13 cents of every dollar that circulates worldwide.
- Although plunging resource prices are taking a bite out of Canadian GDP growth, lower fuel prices are driving external demand for the non-energy manufacturing sector. Hall says the fall in oil and natural gas prices is expected to subtract CAD 53 billion from energy exports this year. However, there is a silver lining in that manufacturers stand to gain from the resulting lower value of the Canadian dollar and healthy external demand for other sectors. For example, thanks to the slumping dollar, aerospace exports will increase by 25% this year. Lower global prices for fuel will also mean increased consumer spending on other goods and services.
- Canada now has the only hub in the Americas for the renminbi (RMB), the official currency of the People’s Republic of China. In barely five years, the RMB has become the fifth most-used payments currency in the world. By adopting the RMB as a payments currency, Canadian exporters can realize new opportunities in the Chinese market, where the growing middle class is creating more demand for Canadian made products.
The GEF also includes insight on other macro trends and market overviews for countries, sectors and provinces, as well as related risks, says Bergman. “It’s always a good idea to get as much information as you can, especially when it’s there for the taking.” Visit edc.ca for a full list of available reports.