International Trade Committee on March 9th, 2015

[Don Davies, NDP, Vancouver Kingsway, BC]

Be brilliant.

[Susan Bincoletto]

I think you have in front of you all of the people responsible for part of the success. I think it's a multipronged approach in terms of both contacts and awareness of the opportunities—whether they have a good business plan or know what they're getting into, whether they're innovative or have good financing, or whether they know there's a suite of programs that the federal government can provide that would help them navigate those trickier waters that emerging markets can often present.

[The Chair, Conservative, Randy Hoback]

Mr. Cannan.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Thank you, Mr. Chair.

Thanks to our witnesses.

Thanks, Mr. Davies, for some excellent questions.

It's an exciting study, for a former small business owner-operator, in terms of understanding our global markets action plan and how we're trying to help small and medium-sized businesses take that leap into the final frontier outside of Canada, which for many people is outside their comfort zone. It's an education process, and I appreciate your continued efforts. They will be ongoing. Our goal is to create jobs, grow the economy, and have prosperity for all.

I know it might be hard for Todd and me, and maybe Mr. Regan, to understand how hair salons can actually export, but....

[Voices]

Oh, oh!

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

We have a franchise chain, Tommy Gun's and Chatters, that's actually on the front page of this month's Franchise magazine. They have 140 franchises and they have operations in Australia as well. So it is possible; there is hope for us yet, guys.

The fact is that it is an emerging market. It's something that my constituents, as many of you around the table.... Our ridings have small businesses, which are the economic engines that drive our local economy. Our largest private employer is Kelowna Flightcraft, and all the rest are small and medium-sized operators.

One common question I get is this. How do we get access to the information? We've talked a little bit today about some of the different programs. There are some excellent programs. Often my staff and I will point entrepreneurs to the websites, trying to get them the tools to help them move forward. Could you maybe expand on whether there's an overall communications strategy in place that will utilize all these tools available on the Internet to inform the SMEs and provide timely access? How do the SMEs know that it's available?

[Shereen Benzvy Miller]

Thank you so much for that question.

I would start by saying that obviously there is a lot of information out there, so it's always a challenge for SMEs to find and access what they need. We have tried to put information into locations where they are most likely to find it, and to find it all together.

One of the opportunities for businesses is to go to the Canada business network site, or canadabusiness.ca, which is a one-stop comprehensive directory of information for services that are provided by federal, provincial, and territorial governments—including municipal governments, actually—to help businesses find the programs and the regulatory things that they need to find in the various sectors in which they operate. It also contains information about financing grants and starting and growing a business.

If you decide that you want to follow that service on Twitter, it is @canadabusiness, and I would encourage you to do that since it does have 95,000 Twitter followers from businesses in the community today. It is a well-followed site.

We also have BizPaL, which again is intended to blur all the lines of government to provide each sector with the various business licences and regulations they need to know about when they're starting and growing a business. Also, the National Research Council's industrial research assistance program, IRAP, has the concierge service, which is intended to hold hands with entrepreneurs to help them walk through the various programs that are available to them.

There are 230 federal programs available to businesses and they're offered by 30 different departments, so this is not an inconsequential or insignificant question that you're asking about how we actually get the information to entrepreneurs who need it.

There are other services. I actually would like to hand the baton to Monsieur Bergeron, because the BDC also has some ways of helping entrepreneurs navigate through these mazes.

[Michel Bergeron]

There are different ways of addressing this particular challenge. One very simple one at the BDC is that we have more than 500 people who meet on a daily basis with entrepreneurs, and all of those employees have been trained on the EDC service offering and vice versa. We try to increase our mutual understanding of what the others offer so that we can relay them, depending on the needs they have, to the proper organization.

The same applies with the trade commissioner service. As I mentioned, some of the commissioners reside in our offices, which fosters collaboration. It's important that mutually we understand well what we do so that we can be a single point of contact for the entrepreneur. Another example is that we cross-train our call centres, for instance, so they can refer to the proper institution.

Lastly, there are a lot of initiatives on the ongoing communications side. The conference series that is taking place across the country is a joint effort by all parties, whereby we try to invite our own clients and explain in simple terms what we do so that they know exactly where to call and who to call.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

That's excellent. I think it's very important that we all are aware of this.

I know that Farm Credit Canada is another great partner. I met with the BC Fruit Growers' Association executive director and president this morning. That's another one. They're looking at exporting Campion boats. They're manufacturing boats and are looking at all these different opportunities.

You mentioned earlier that hard-working Minister Fast has been working on these Go Global workshops. He has held I think 11 or 12, and there are more coming up. Maybe you could talk a little about what you've heard from those workshops, what the SMEs are telling you, and what you are doing with that information as you move forward.

[Susan Bincoletto]

We started these workshops and I think have now completed nine or ten. We've touched about a thousand SMEs, so it has been a success. On average, there were about 100 participants per workshop. They're normally in secondary cities. They're not in the big metropolitan areas.

We have representatives of my service, the EDC, the BDC, and the CCC come in to speak to the participants on what opportunities exist in terms of the federal suite of programs but also in terms of some of the regional opportunities, depending on which sector these SMEs operate in. We do surveys at the end of each one, and we're compiling them. It's early days, but it has been very well received.

What we do in the trade commissioner service is then follow up with these participants. We have a fairly sophisticated client management system, as my colleagues have as well. Once we establish that first contact, we follow up to really see whether we can help continue their understanding and their working through of their potential expansion strategies.

The Go Global workshop is an opportunity for us to actually reach out and increase their understanding of those opportunities. Something that Minister Fast is always saying is that the trade commissioner service is one of the best kept secrets in terms of those opportunities. That's what these workshops are intended to be. We will continue them over the next six months, and we will then be able to better evaluate how successful they have been.

[The Chair, Conservative, Randy Hoback]

Thank you very much.

[Susan Bincoletto]

I'm sorry, Todd wanted to add something.

[The Chair, Conservative, Randy Hoback]

I'm sorry, I have to go to the next set of questions. Sorry, Todd.

Mr. Regan, you have the floor.

[Geoff Regan, Liberal, Halifax West, NS]

Thank you, Mr. Chair.

I can't help but note, as a visitor to the committee, the level of commitment to democratic principles of the other two parties in setting only five minutes in the first round for the Liberal Party, as opposed to seven for all the other questioners. I've never experienced that in all the committees that I've sat on and visited over the years.

One thing I didn't hear about at all today was e-commerce. The industry committee at the House of Commons did a report two years ago on e-commerce and the need for Canadian businesses, especially small and medium-sized enterprises, to adopt it more. Obviously, we see some that are selling around the world using the Internet and e-commerce.

I don't think I heard any of you mention e-commerce today. What part of your strategy is e-commerce?

[Michel Bergeron]

I'll answer this question, because this is a topic we've been working on quite actively over the last three years.

In fact, we just released an e-book advising entrepreneurs on how to adopt proper practices for e-commerce. My stats are a bit outdated, but something like 84% of Canadians buy online versus only 17% of Canadian businesses that sell online. We see there is a huge gap in between. Part of our role is increasing awareness of how to go about doing e-commerce. There are very low-cost applications that can be used to leverage the e-commerce world.

You are right that it's an area in which unfortunately a lot of our firms, especially on the retail side, have just not adopted those technologies. Unless they do so, they risk losing a lot of business as purchasing habits are increasingly going online.

[Geoff Regan, Liberal, Halifax West, NS]

It seems to me the challenge is educating those businesses about the opportunities, the way to do it, and the fact that it isn't as hard as they might think.

What can you tell me about what you're doing, if that is something that any of you are working on?

[Michel Bergeron]

On the consulting side, one practice that we've started developing on the marketing front is helping firms to be found on the web. It's one thing to have a website, but you want this website to be found.

To what extent is the website properly structured? I'll give you a very simple example. One client had a French-only website. They translated the website, and as a result now 50% of their sales are done in Russia. It's an amazing story. You just translate the website, and then your search results go up on Google. They found new customers without making a significant investment.

[Geoff Regan, Liberal, Halifax West, NS]

Into how many languages are you assisting them to translate? Was that into Russian?

[Michel Bergeron]

No, it was just English. It's French and English. That's a relatively low-cost piece of work.

One thing is helping the firms identify how to be found on Google, through search engine optimization, and so forth, and then making sure the website is structured properly so that ultimately there is an e-commerce platform within it that people can purchase on.

[Geoff Regan, Liberal, Halifax West, NS]

Ms. Benzvy Miller, you mentioned that BDC provides consulting services, and it provides $4 billion a year in financing to those firms that export, I think you mean SMEs. Perhaps Mr. Bergeron wants to answer this, but we'll see.

What percentage of those firms would have between 20 to 99 employees? What percentage would have 20 or fewer employees? How do you break it down? Do you have those figures?

[Shereen Benzvy Miller]

I'll let you answer because you're lending.

[Michel Bergeron]

It depends how you define the breakdown, by number of clients or by dollars of commitment. If you go by the number of clients, I'd say roughly 80% of our 30,000 clients have fewer than 20 employees. As I mentioned—

[Geoff Regan, Liberal, Halifax West, NS]

How does the $4 billion break down?

[Michel Bergeron]

This is how the $4 billion breaks down. If you look at the number of transactions, you would see 80% go to the smaller firms; if you look at the dollar amount, it's the reverse. Obviously, the bigger companies receive the bigger number of dollars, so it's kind of an 80:20 rule. The top 20% get 80% of the dollars because the financial needs at the lower end of the market are not as great.

[Geoff Regan, Liberal, Halifax West, NS]

Mr. Winterhalt, when you referred to the 50 companies that you are working with, SMEs, what sizes would those be and how many would be in each of those ranges?