17 Apr 2019
Eric Dufour
Vice-President, Partner | FCPA, FCA | Management consulting

Dany Boutin, who owns the Métro Plus supermarket in Dolbeau-Mistassini, ensured the family business’s continuity by transferring it to his children, Naomi and Olivier.

The new owners will be investing $5M to renovate the supermarket. This is a perfect example of entrepreneurial succession.

During a Radio-Canada radio interview, Éric Dufour, Regional Vice-President and National Business Transfer Leader at Raymond Chabot Grant Thornton said, “It’s not easy to get an entrepreneur to start thinking about this, it triggers a sense of mourning.”

Additionally, in a Radio-Canada newscast, he explained to broadcaster Mélissa Paradis that “Only 10% of entrepreneurs initiate a business transfer process and they often delay doing so.

However, there appears to be a change, given the labour shortage issue. Entrepreneurs are realizing that, in light of this situation, one solution is to bring key personnel onboard as shareholders. They are talking to family, getting more information and are now developing true succession plans.”

In Quebec, many business owners have not begun to prepare their succession. According to a Business Development Bank of Canada study, 60% of business owners are 50 years old and over and more than 41% expect to leave their business in the next five years. Regions with lower populations are the first to be affected by these statistics and often find it difficult to compete with larger urban centres.

This is why it’s important to prepare your business transfer. In addition to the concept of mourning Éric Dufour mentioned, the apparent complexity of a business transfer and the fear of distressing the business’s employees are other reasons that hinder the transfer.

In a series of articles for subscribers on entrepreneurial succession published in Les Affaires last year, Éric Dufour outlined the steps for a successful transfer: “The process can begin with a transfer of responsibilities. This can be followed by a reflection on the next steps, such as progressively introducing a shareholder structure. In this way, the owner’s involvement is gradually reduced while he or she goes through the essential mourning period.”

Ask our entrepreneurial succession experts for advice.

17 Apr 2019  |  Written by :

Éric Dufour is a vice-president at Raymond Chabot Grant Thornton. He is your expert in management...

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17 Apr 2019
Eric Dufour
Vice-President, Partner | FCPA, FCA | Management consulting

Quebec SMEs Study Reveals Recruiting and Retaining Talent, Digital Shift and Competitiveness at Heart of Concerns

MONTRÉAL, April 17, 2019 – Raymond Chabot Grant Thornton takes the concerns of local businesses to heart and decided to survey 300 SME business leaders to better understand the issues and challenges they face. The study highlights the following: international markets remain under-exploited, recruiting and retaining talent are a concern and the digital shift is essential for sustainability.

Conquering international markets: a huge potential to be exploited

The study reveals that only 10% of businesses carried out international development in the last two years and one in ten SMEs plans on doing so in the next five years. Raymond Chabot Grant Thornton President and CEO, Emilio B. Imbriglio said: “In a globalization era, the international market presents a huge opportunity. It’s astonishing to note that Quebec SMEs focus mainly on local growth, when in fact they now have global access. Local businesses need to take advantage of international agreements put in place by our governments, such as the Comprehensive Economic and Trade Agreement between Canada and the European Union, the newly signed Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or the new version of NAFTA. They could be better supported, particularly given the fact that 81% of businesses surveyed that have set up operations abroad consider their transaction to have been successful.” This being said, companies are still pursuing growth opportunities: 62% have completed development activities in the past two years; 37% diversified their products and services, 31% created strategic partnerships and 27% entered a new market.

Digital shift: challenges and opportunities

Although the digital shift seems to be a major challenge for Quebec SMEs, only 43% invested in it last year. “You have to invest continuously to remain competitive in a business environment where digital and other technologies are omnipresent,” added Imbriglio.

More broadly, the survey reveals that 41% of leaders do not have the financial means to develop innovation and 51% are not aware of all the financial resources available. Imbriglio stated: “Companies must be given the means to achieve their ambitions in order to invest in innovation. As our firm has been proposing for many years, an innovation tax credit is essential to help them increase their technology investments and enable them to pursue growth opportunities.”

Labour shortage – a key priority

Although businesses are investing in training and development (83%), the greatest challenge is recruiting staff (48%), followed by retention (23%). According to Marc Audet, President of AURAY Sourcing, a Raymond Chabot Grant Thornton subsidiary: “In the context of the current labour shortage, local businesses will have to find creative solutions to fill this gap. One possible approach is to recruit specialized talent from outside the country, since temporary immigration makes it possible to fill key positions quickly across the province. Perhaps some of the funds generated by the Immigrant Investor Program, that are not subsidized by the government, could be allocated to cover part of the international recruiting costs. These small amendments would help support the growth of Quebec businesses.”

For more information, click here or download this document to view the survey highlights and other issues raised by Quebec SMEs (available in French only).

About Raymond Chabot Grant Thornton

Raymond Chabot Grant Thornton is a professional services firm dedicated to the success of organizations and their leaders since 1948. The firm‘s advisors are committed to helping clients thrive by obtaining a deep understanding of what is important to them, their business and their industry. This knowledge, combined with a team of motivated and talented professionals help accelerate growth. A Quebec and Canadian leader in the areas of assurance, tax, advisory services and business recovery and reorganization, Raymond Chabot Grant Thornton boasts more than 2,600 professionals, including approximately 200 partners, working in over 100 offices across the province of Quebec and in the Ottawa and Edmundston regions.

Together with Grant Thornton LLP, another Canadian firm, and the Grant Thornton global organization, our global footprint spans across more than 135 countries with over 53,000 people who provide real insight, a fresh perspective and agility to keep clients moving ahead.

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Source:

Francis Letendre
Head, Public Affairs
Raymond Chabot Grant Thornton
Tel. : 514 390-4201
[email protected]

17 Apr 2019  |  Written by :

Éric Dufour is a vice-president at Raymond Chabot Grant Thornton. He is your expert in management...

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12 Apr 2019
Eric Dufour
Vice-President, Partner | FCPA, FCA | Management consulting

To ensure their sustainability and growth, Quebec SMEs will have to overcome several major challenges in the short- and medium-term, particularly in terms of labour and technological investments.

These are the results revealed by a recent Raymond Chabot Grant Thornton (RCGT) survey of 300 Quebec business leaders. According to the telephone survey conducted by Léger, the main challenges they will have to face in the next three years are recruiting and retaining staff, and technological change and competition.

In the near future, market competitiveness and accelerating information processing are issues for most businesses.

Focussing on growth

Good news: Quebec SMEs were active enough in the past two years to ensure their growth in a context of increasing competitiveness. Accordingly, 62% of them carried out one or more development activities. The most common ones involved diversifying their product and service offering (37%), establishing strategic partnerships with other businesses (31%) and penetrating a new market (27%).

Some 8% of SMEs accelerated their development by carrying out an acquisition, a transaction that involves major challenges. These include integration ability – cited as a main challenge by 26% of acquiring companies – the implementation of a common culture and values (20%) and personnel management (17%).

International expansion was a growth method for 10% of businesses. More than half of them (55%) developed their presence in the United States, 47% in Europe and 15% in China. In most cases, the operation was successful: 79% of leaders stated that it had been profitable, and 21% even consider it very successful.

On the other hand, 10% of businesses that have not yet developed the international market plan on doing so within five years, a proportion that rises to 22% among companies with 100 or more employees.

Innovation

We often hear that innovation is at the heart of competitiveness. In this regard, 65% of companies consider their level of maturity to be fairly or very advanced compared to their competitors. However, 41% claim they don’t have the internal financial resources to develop innovation. In fact, half of the leaders say they are poorly informed about the financial resources available to support their efforts in this regard.

Digital shift

The survey also reveals that just over half of SMEs (57%) have not yet invested in the digital shift, even though it is their third most important issue. The most common investments are in cloud computing (17%), implementing or modifying computer programs (12%), and integrating management software (11%).

Accelerating information processing (for 51% of SMEs), client data security (43%) and the soundness of IT systems (35%) are also major technological issues, according to respondents.

While Quebec is positioning itself as a world leader in artificial intelligence (AI), one out of ten companies has already integrated AI technologies (6%) or plans on doing so in the near future (5%). Interestingly, in the construction sector, the proportion of Quebec companies that have already implemented artificial intelligence projects has risen to 20%, a possible indicator of the industry’s desire to breach its productivity gap.

Labour and organizational culture

Raised by 57% of SMEs, labour force issues are the main challenge for the next three years. To resolve this problem, Quebec companies are focusing entirely on training and skills development (83%).

In fact, more than half of the executives surveyed have created new training tools (61%), increased training expenses (57%) or implemented an employee development program (55%) over the past five years. Just over 40% of companies have also introduced continuing education incentives. These figures rise significantly among companies with 100 or more employees.

Social and environmental responsibility

One of the challenges faced by SMEs is the obvious need to adopt responsible practices. In fact, a high percentage of executives (90%) consider it important to do business with socially responsible suppliers.

Companies are already taking steps to achieve this. In the past five years, more than half of the SMEs surveyed have implemented actions to use less paper (83%) and fewer plastic or Styrofoam cups (71%), or to reduce their ecological footprint (53%). Four in ten companies (42%) introduced an environmental policy.

Furthermore, to contribute to the collective well-being, 46% of executives are involved as volunteers with an organization, and 22% of SMEs have a volunteer program that allows staff to volunteer their time to charitable organizations.

Inspirational successes

Do you recognize yourself in this survey because your company is facing one or more of these major issues? The success of outstanding leaders will inspire you to take on these challenges with flying colours.

To discover best practices in innovation, international expansion, corporate transactions and leadership, we invite you to read about the success stories of the Person of the Year Award finalists.

Study methodology: Telephone survey of 300 leading Quebec businesses with 10 to 499 employees, February 2019.

17 Apr 2019  |  Written by :

Éric Dufour is a vice-president at Raymond Chabot Grant Thornton. He is your expert in management...

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11 Apr 2019
Eric Dufour
Vice-President, Partner | FCPA, FCA | Management consulting

Nancy Jalbert, Partner, Management Consulting and 4.0 Leader at Raymond Chabot Grant Thornton, joined a group of experts who travelled to Germany for the Hannover Messe to find out about the latest manufacturing sector technology.

Manufacturing businesses around the world are becoming aware of the growing impact of technology shifts on manufacturing processes, the client experience and human resource management. Known as the 4th industrial revolution, this global transformation movement is driving businesses to innovate in order to stay competitive and meet growing requirements in today’s market.

It is in this context that Pierre Fitzgibbon, Economy and Innovation Minister, led a mission to Germany with some 130 participants from ten Quebec regions to enable them to deepen their knowledge on the latest trends in the 4.0 universe.

In association with the Chambre de commerce et d’industrie Nouvelle-Beauce for the de Chaudière-Appalaches region, the mission provided an opportunity for a delegation of Quebec specialists and entrepreneurs to attend Hannover Messe in Germany, the largest industrial technology trade show in the world. This show has over 5,000 highly specialized exhibitors in such fields as robotics, artificial intelligence, virtual reality, predictive maintenance and interconnected solutions. Hannover Messe is the ideal location to get a preview of the latest industrial innovations.

Digital transformation is key to economic growth

Nancy Jalbert said, “Hannover Messe is a very impressive trade show and the quality of the exhibitors is beyond expectations. It’s a gold mine of information. Exhibitors offer visitors a new way of seeing and understanding technology advances. They are pushing the limits of what’s possible and have tangible examples of just how far manufacturing businesses can go these days to optimize their products and services.”

She noted that organizations must get onboard more quickly. It seems that 85% of European businesses have adopted the digital shift in their organizations, compared with only 25% in Quebec. According to Cefrio, barely half of manufacturing organizations know what industry 4.0 is. Managers must take action quickly if they want to ensure their organization’s growth and sustainability.

Nancy Jalbert added, “At Raymond Chabot Grant Thornton, we are already supporting local businesses in their digital shift by conducting 4.0 audits and we have presented a tour with conferences on 4.0 to make Quebec businesses aware of the digital shift, demystify the topic and support them. We know that businesses want to move forward, but it’s not enough. Still, I’m optimistic when I see the diversity of the strategic players in the delegation and the extent of Quebec’s commitment to the digital shift.”

Some managers underestimate the impact of the digital shift in manufacturing, while others are overwhelmed by the scope of the movement and the organizational changes needed.

The support of specialized business consultants can help managers take the first steps towards the change. A personalized, tangible process can determine the organization’s specific needs based on its technological progress and help overcome the major digital shift.

Hanovre délégation Chaudière-Appalaches

Chaudière-Appalaches Delegation. Photo credit: Agence Webdiffusion

17 Apr 2019  |  Written by :

Éric Dufour is a vice-president at Raymond Chabot Grant Thornton. He is your expert in management...

See the profile