Rising costs hit businesses | Spare News

Rising costs hit businesses | Spare News

THUNDER BAY, ONT. — The Canadian Chamber of Commerce released its quarterly report reflecting business conditions at the end of 2022.

According to Charla Robinson, President of the Thunder Bay Chamber of Commerce, the report released in December was prepared by the Canadian Chamber of Commerce and Statistics Canada and draws attention to the challenges facing businesses.

“The biggest challenge is the rising cost of doing business,” said Robinson. “That was mentioned by more than 50 percent of the companies. Then there are things like debt costs because their interest rates are going up. If you are a business that has loans to get your business started or maybe you did some renovations or something like that and you had to take out an extra loan, those costs will also increase. This inflation affects all things – not just the input cost of what they buy, but the cost of paying off their debt and the interest on their debt.”

She says labor law challenges continue to put pressure on companies.

“Recruiting and retaining employees is really difficult. Finding the people that fit what you’re looking for and then keeping them is a real challenge,” she said. “Supply chains continue to be a problem. They are certainly improving but remain challenging.”

Then there are the growth prospects. She says that because of rising interest rates and rising costs, there has been “quite a bit of chatter” from economists about whether we’re going into a recession or how big a recession might be.

“That has tempered optimism from businesses about how this year will have their chance to grow and thrive as inflation and recession affect everyone in turn,” she said, noting that customers may even scale back their purchases could and are making choices to pay rising mortgage rates instead of buying furniture or going out to dinner.

“It hurts business owners’ optimism because they’re not entirely sure how their customers are going to react,” she said.

As businesses struggled through the COVID-19 pandemic, many are still trying to catch up on their pre-COVID earnings and have had to resort to debt to keep their doors open.

“You definitely feel a lot of that pressure,” Robinson said. “There’s this uncertainty about how much they should invest further or how they should moderate by reducing staff or hours. When they cannot get deliveries or the price of the deliveries has increased, the prices they have to charge become an obstacle for these customers. There is a lot of uncertainty right now and companies are definitely feeling the pressure.”

Robinson says these are some of the key issues they see reflected in the report, and it will certainly be a “somewhat challenging year” as people continue to work on these issues.

The Canadian Press. All rights reserved.

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