Small biz has positive outlook thanks to tech opportunities, survey suggests

It didn’t take long after the pandemic hit for Ali Khan Lalani to start thinking of his pizza restaurant as more of a tech company.

Shortly after the first lockdown in 2020, General Assembly Pizza in downtown Toronto started selling pizzas to customers at home using an e-commerce platform, simple advertising analytics and a dedicated team of tech workers.

Lalani, the founder and CEO of General Assembly Pizza, said his business has already grown to 70 workers, more than double what it was pre-pandemic. Roughly a dozen of those employees work completely in the tech space.

The company said it sold more than $5 million in product, including 300,000 frozen pizzas, since launching their e-commerce platform. It was enough to cover their losses from lockdowns in 2020.

This year he expects the company to have increased sales by 400%, and Lalani has a positive growth outlook for years to come.

“For not a substantial amount of capital, and by using existing apps stacked on to a Shopify e-commerce platform, you could monkey together a pretty respectable e-commerce solution for a relatively approachable amount of capital and get going pretty quick,” Lalani said.

“It was all from a very simple idea of how do we leverage technology today to find our customers.”

Lalani’s company isn’t alone in its optimism. A survey of small and medium-sized enterprises (SME) by KPMG found 92% of SMEs are confident they have the right strategies to overcome short-term hurdles and grow their company in the next three years.

Mary Jo Fedy, KPMG’s national enterprise leader in Canada, said digitization is a large part of why businesses are able to feel so confident, as they realize what technology can do to grow a company.

“The last year and a half clearly demonstrated that going digital is essential for success,” said Fedy.

“Companies that will lead the way forward will be able to adapt rapidly to emerging risks and capitalize on the digital opportunities realized during the pandemic through sustained tech investment and adoption.”

Fedy said digital investments will allow companies to operate more efficiently, reduce human error and allow their workforces to take on more meaningful work.

The survey found 85% of businesses are investing much more in implementing new technology, and that more than half of businesses are prioritizing those tech investments.

However, the survey found SMEs have their concerns as well, saying that issues around the labour market, supply chain and cybersecurity in an increasingly digital world are some of the things operators believe could impede growth.

Fedy pointed out that 68% of businesses are struggling to find the right kind of tech skills to put their business ahead.

In Toronto, Lalani agreed that labour shortages are a concern in the entire service industry, even beyond tech jobs.

“It’s probably the single biggest thing that threatens the livelihood of viable long term success for the service industry,” Lalani said.

“So many people left, that to get people is costing a lot more money,” but it’s an investment that will be necessary for the future of his business, he said.

Advisors can help small businesses that are facing high costs and funding concerns, said a Scotiabank report on small business released on Wednesday.

“Small business advisors can help plan and prepare businesses for increases in the cost of inputs to help make informed pricing decisions,” that report said. “They can help [businesses] gain access to the capital needed to grow business operations, hire staff and enhance their digital capabilities.”

In a survey of 901 Canadian small business owners, commissioned by Scotiabank, 51% expected to need more financing in the coming year, the report said.