Only 15 per cent of businesses in Atlantic Canada are digitally advanced leaving them at risk of becoming obsolete.
That’s according to a study released by the Business Development Bank of Canada (BDC).
While its research found most businesses across the country have low digital maturity, Atlantic Canadian businesses ranked lowest — below the national average of 19 per cent.
“Those that aren’t embracing new technologies are falling behind,” the BDC report warns.
However, those who are embracing technology are reaping the benefits.
Newfoundland-based telehealth company Fonemed has been in business for over 20 years, and CEO Charlene Brophy said its success lies in staying one step ahead with technological advances.
“The data we collect is really demonstrating the benefits of embracing digital technology,” she said.
“For example, every month I report to my clients on the number of ER visits we diverted to keep the patients at home, or the number of days I shortened a hospital stay because I could put them on this technology and manage them at home and teach them how to use it.”
Brophy said despite the low numbers in this recent report, she’s noticed a shift in perspective in this province in recent years.
“Some businesses I interact with, I’m starting to see that they recognize that we’ve got to get ahead of the game — we can’t just sit back and continue to provide services the way we’ve always done it because if so, we’re going to be left behind.
“I think in our province alone, there’s such an innovative culture nowadays that it’s a new level of excitement that I’ve not seen until recent times, so let’s hope that means the tides are changing for us.”
At Fonemed, Brophy hired a team of software engineers to move the company from service-only to a technology company as well.
That move meant Fonemed could do more than offer telehealth services — the company could also install its technology at health centres around the world.
The company’s software can now be found from Bangladesh to Puerto Rico.
“They’re now using our technology to manage their patient population. So, by shifting, it opened up a whole new opportunity.”
Small businesses online
Creating an effective online presence can sometimes be tricky for small businesses, but local accessories shop Whink has embraced it from the moment owner Kim Paddon opened the doors eight years ago.
Paddon said carving out an online presence is “the number one thing” for her business.
“You have to do that in this day in age where you have competitors like Amazon,” she said.
It’s paid off — not only is her brick-and-mortar store in Churchill Square benefitting, but with online shopping she now has customers all across Canada and in the United States.
While Paddon admits building that presence can be challenging, she’s benefitted from utilizing user-friendly but effective tools —such as using Shopify as a website platform.
“A lot of people think, ‘Oh my God, I’ve got to build a website from scratch,’ but you don’t because there’s so many tools out there that make it so easy for you.”
BDC announces additional funding to help
The BDC study was based on a survey of 2,000 small and medium sized businesses across the country, as well as 600 American businesses.
It measured how advanced companies are in their use of digital technologies, and how that relates to their growth and sales.
BDC found that businesses with low digital maturity performed poorly in the last three years, with 25 per cent of those businesses watching their sales plummet.
Businesses with higher digital maturity were more likely to have higher sales and profit growth over the last three years, and were 70 per cent more likely to have exported.
The proportions found were similar in the United States, leading BDC to conclude there’s no digital gap between the two countries among small and mid-sized businesses.
Brophy’s telehealth business operates on both sides of the border and she sees the importance of embracing technology first-hand.
“Technology is engrained in our everyday lives now, and the way that consumers behave through communication and connectivity is constantly changing. Because of that, we need to be proactive versus reactive to deal with the way the changes are occurring, and the impact that’s going to have on all of our businesses.”
The report was released on the same day BDC kicked off Small Business Week and announced $250 million in additional financing to help small and mid-sized businesses with intangible assets such as technology, intellectual property and employee training.
BDC also recently launched a free online digital maturity assessment tool at bdc.ca – businesses can use it to compare themselves to others in the same industry and pinpoint areas for improvement.