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The Business Researcher Newsletter
 March 19, 2004  Volume 7 Number 2

 

 

RETURN TO ARCHIVES

 Introduction: Opening Comments
 

Hello,

Welcome to the March issue of our newsletter.

I hope you find this issue helpful.

John White
GDSourcing - Research & Retrieval

 Return to Table of Contents

 What is new at www.gdsourcing.ca:
 Injury, High Speed, Direct Sales
 

Industrial Accident & Prevention Association
Site: http://www.iapa.ca/
Site Summary: http://www.gdsourcing.ca/works/IAPA.htm
Statistics on workplace injury by selected industry sectors in Ontario

 

Broadband Reports
Site: http://www.broadbandreports.com/
Site Summary: http://www.gdsourcing.ca/works/BroadbandReports.htm
Ranking of the fastest broadband ISPs in Canada Provides Type (telco, cable), Down kbps, Upload kbps, User Reviews and Pricing Plans.

 

Direct Sellers Association of Canada
Site: http://www.dsa.ca/
Site Summary: http://www.gdsourcing.ca/works/directsellers.htm
Statistics related to direct selling in Canada. (Location of sales, compensation structures, sales methods.)

Return to Table of Contents

 

 Statistics Canada Releases
 

The following statistics were released by Statistics Canada over the last month. We have listed those releases we feel are of the most interest to Canadian entrepreneurs.

Very few of these statistics are available on-line. The URL listed is a direct link to the press release associated with the data. It provides contact and ordering information.

If you want to purchase any publication related to these releases please see our web site: http://www.gdsourcing.com/works/StatCan.htm

We offer a 20% discount on most Stats Can publications and a 10% discount on Stats Can electronic products. For more information you can reach us at contact@gdsourcing.com. Put "StatsCan" in the subject line of your e-mail.

 

AGRICULTURE

Livestock estimates As of January 1, 2004
http://www.statcan.ca/Daily/English/040218/d040218b.htm

Analysis in Brief: Mad Cow Disease and Beef Trade: An Update, no. 10
http://www.statcan.ca/english/IPS/Data/11-621-MIE2004010.htm

Wool disposition and farm value 2002
http://www.statcan.ca/Daily/English/040218/d040218f.htm

Hog Statistics, 2004, Vol. 3, no. 1
http://www.statcan.ca/english/IPS/Data/23-010-XIE.htm

Sheep Statistics, 2004, Vol. 3, no. 1
http://www.statcan.ca/english/IPS/Data/23-011-XIE.htm

Cattle statistics
http://www.statcan.ca/english/IPS/Data/23-012-XIE.htm

Farm cash receipts 2003
http://www.statcan.ca/Daily/English/040224/d040224b.htm

 

CONSTRUCTION

Residential construction investment 2003 and fourth quarter 2003
http://www.statcan.ca/Daily/English/040227/d040227b.htm

Flows and stocks of fixed residential capital 2003
http://www.statcan.ca/Daily/English/040310/d040310d.htm

 

ECONOMIC INDICATORS

Canadian economic accounts 2003 and fourth quarter 2003
http://www.statcan.ca/Daily/English/040227/d040227a.htm

Annual Review of the Consumer Price Index 2003
http://www.statcan.ca/Daily/English/040219/d040219b.htm

Labour Force Historical Review on CD-ROM 1976 to 2003
http://www.statcan.ca/Daily/English/040217/b040217a.htm

Financial statistics for enterprises 2003 and fourth quarter 2003 (preliminary)
http://www.statcan.ca/Daily/English/040225/d040225b.htm

Financial and Taxation Statistics for Enterprises 2002
http://www.statcan.ca/Daily/English/040308/d040308a.htm

Private and public investment 2004 intentions
http://www.statcan.ca/Daily/English/040225/d040225c.htm

Study: Interprovincial and international trade among the provinces 1992 to 2002
http://www.statcan.ca/Daily/English/040305/d040305a.htm

 

EDUCATION

National Graduates Survey: Student debt Class of 2000
http://www.statcan.ca/Daily/English/040426/d040426a.htm

Youth in Transition Survey 2002
http://www.statcan.ca/Daily/English/040405/d040405a.htm

 

INFORMATION TECHNOLOGY

Commercial Software Price Index January 2000 to December 2003 (preliminary)
http://www.statcan.ca/Daily/English/040311/d040311d.htm

Study: Information and communication technology gap between small and large companies
http://www.statcan.ca/Daily/English/040223/d040223b.htm

Technological change in the public sector 2000 to 2002
http://www.statcan.ca/Daily/English/040309/d040309a.htm

 

JUSTICE

Trends in drug offences and the role of alcohol and drugs in crime 2002
http://www.statcan.ca/Daily/English/040223/d040223a.htm

Legal aid in Canada: Resource and caseload statistics 2002/03
http://www.statcan.ca/Daily/English/040226/d040226e.htm

Youth court statistics 2002/03
http://www.statcan.ca/Daily/English/040312/d040312c.htm

 

MANUFACTURING

Study: Corporate financial leverage and employment in manufacturing 1988 to 1997
http://www.statcan.ca/Daily/English/040218/d040218c.htm

 

MARKET

Days of Our Lives: Time Use and Transitions over the Life Course: School, Work and the School-work Combination by Young People, 1998
http://www.statcan.ca/english/IPS/Data/89-584-MIE2003003.htm

Intercensal and postcensal estimates of total population and population by age and sex for census divisions and census metropolitan areas
As of July 1, 1996 to 2003
http://www.statcan.ca/Daily/English/040309/d040309b.htm

Intercensal and postcensal population estimates by marital status and legal marital status, age and sex July 1, 1971 to 2003
http://www.statcan.ca/Daily/English/040311/d040311b.htm

 

PRIMARY SECTOR

Electric Power Capability and Load, 2001
http://www.statcan.ca/english/IPS/Data/57-204-XIB.htm

Coal mining 2002
http://www.statcan.ca/Daily/English/040225/d040225g.htm

General Review of the Mineral Industries, Mines, Quarries and Sand Pits, 2001
http://www.statcan.ca/english/IPS/Data/26-201-XIB.htm

 

SOCIAL STATISTICS / POVERTY

Low income cutoffs for 2003 and low income measures for 2001
http://www.statcan.ca/Daily/English/040309/d040309c.htm

 

TRADE

Retail trade 2003 and December 2003
http://www.statcan.ca/Daily/English/040226/d040226b.htm

Wholesale trade 2003 and December 2003
http://www.statcan.ca/Daily/English/040226/d040226c.htm

Monthly Survey of Large Retailers 2003 and December 2003
http://www.statcan.ca/Daily/English/040220/d040220c.htm

Small area retail trade estimates 2001
http://www.statcan.ca/Daily/English/040316/d040316b.htm

 

TRANSPORTATION

Domestic travel 2000 (revised)
http://www.statcan.ca/Daily/English/040301/d040301d.htm

International travel account 2003 and fourth quarter 2003 (preliminary)
http://www.statcan.ca/Daily/English/040225/d040225a.htm

Passenger bus industry 2002(preliminary)
http://www.statcan.ca/Daily/English/040315/d040315c.htm

Port activity 2002
http://www.statcan.ca/Daily/English/040220/d040220b.htm

Road motor vehicle registrations 2003 (preliminary)
http://www.statcan.ca/Daily/English/040220/d040220g.htm

 

WORKPLACE

Study: Seniors at work: An update 2001
http://www.statcan.ca/Daily/English/040225/d040225d.htm

 

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 Researching the Canadian Consumer

 

In market research you want to profile your specific target market with as much detail as possible. While such information is essential for a successful business plan do not neglect to look at the larger picture. Information on the Canadian consumer as a whole can help you to track trends and identify opportunities you might not have recognized within your target market proper.

Among economists, one of the key indicators related the Canadian consumer is "Personal expenditure on consumer goods and services” also referred to as "Consumer Spending". It can be found in most economic reports and forecasts. This indicator tracks the expenditure activity of the Canadian consumer and their level of contribution to overall economic growth. It provides insight into consumer activity both as a whole and by specific sectors (e.g. Recreational services).

According to Statistics Canada's latest release (Feb 27, 2004):

“Consumer spending was flat after eight straight years of advances, averaging 0.8% per quarter. Despite generous incentives, spending on new cars fell 8.2% while purchases of new trucks plummeted almost twice as much. As a result, retailers recorded their first drop in activity in two years. Excluding motor vehicle dealers, however, retail activity advanced 1.0%.

Purchases of semi-durable goods edged down, as spending on clothing and footwear fell 1.1%. Consumer outlays on services increased 1.0%, with tourism-related spending on restaurant meals, accommodation and transportation all recording advances.”

You can find overall annual consumer-spending data at the Statistics Canada web site: http://www.statcan.ca/english/Pgdb/econ05.htm.

For the latest quarterly commentary and data see:
http://www.statcan.ca/english/freepub/13-010-XIE/free.htm (Look under GDP by Expenditure)

For Consumer Spending by detailed consumer goods and services categories you will need to use CANSIM table 380-0009. You can access this at: http://cansim2.statcan.ca (Use the “find by table number” feature). There is a $3 charge per time series.

Tracking how consumers have performed is important. It can help you to put into perspective your own business/industry's past performance. Most businesses however are usually more interested in the future.

Statistics Canada does not forecast consumer-spending figures. For this information you need to look to the web site of your favourite bank, more specifically their economics section. They all provide quarterly and annual interpretations and forecasts of economic indicators.

For example according to the latest outlook for consumer spending from TD Economics (March 11, 2004):

“In sum, while there is no denying that consumer spending growth ended 2003 on a disappointing note, there is nothing in the data to suggest that the lull is more than temporary. And, looking ahead, as long as the business sector holds its own - and we expect that it will - the pace of job growth should be sufficient to quash any real worries on the consumer spending front.”

As a business you can use this data to gauge the strength of the consumer environment and the future growth it is likely to have.

Another key economic indicator related to Canadian consumers is Personal Disposable Income (PDI). This indicator does not refer to income available after basic expenses are covered (e.g. how much is left over in the household budget to go to the movies) but rather the amount left over after payment of personal taxes. It is a measure of the funds available for personal expenditure on goods and services and personal savings for investment.

As a consumer business you can use PDI forecasts as a basis for your own projected growth. Some businesses are affected positively when PDI grows quickly (especially convenience services and goods) while others can be negatively impacted.

For example the Ontario Ministry of Agriculture and Food estimates that Restaurant expenditures represent 4.7% of Personal Disposable Income. As PDI rises the actual money available for restaurant meals also rises affecting full service establishments more so than fast food. If a consumer has more money available to spend the likelihood of eating at a better restaurant increases.

The latest forecast from a survey of leading Canadian economists indicates that growth in Personal Disposable Income (PDI) will remain the same as last year, with PDI expected to grow solidly at 3.4 percent in 2004 and 3.5 percent in the medium term, but decrease to 3 percent over the long term. (Watson Wyatt)

For your own business you need to compare historical figures of PDI with the performance of your business and/or your industry over the same period. You want to determine if there is a direct and apparent correlation between the two. In other words how does the growth rate in the PDI compared to the growth rate in your industry's sales level? If a correlation is identified, you can use economic forecasts of PDI as the basis of your own performance forecasts.

Sources of information on Personal Disposable Income include:



Personal Disposable Income Per Capita: Commentary
Statistics Canada
http://www.statcan.ca/english/freepub/13-605-XIE/2003001/chronology/2003provincial/pdi.htm

Personal Disposable Income Per Capita: Data Tables
Statistics Canada
http://www.statcan.ca/english/freepub/13-605-XIE/2003001/chronology/2003provincial/tables/pdi01.htm

Latest Economic Indicators
Statistics Canada
http://www.statcan.ca/english/Pgdb/indic.htm

Household Credit Analysis
CIBC
http://research.cibcwm.com/economic_public/download/hca-02022004-internet.pdf


The Current State of Canadian Family Finances 2003
Vanier Institute of the Family
http://www.vifamily.ca/library/cft/state03.html


This report includes % increase in personal disposable incomes, % increase in household spending, % increase in household debt (1989-2003), average incomes by family type, poverty rates by family type, major components of average net worth per household, average debt.

A similar report to the one above is the “How to Retire Rich” feature in the Feb 2004 issue of National Post Business magazine (p23-64) It does not include PDI specifically but it does cover the typical budget for average households and those in the top income quintile by age group (20s, 30s, 40s, 50s, and 60s). Covers: net worth, income, major expense categories (education, shelter, food, clothing, transportation, utilities, taxes, insurance, charitable giving), assets, liabilities (credit card debt, mortgages, line of credit student loans, car loans)


Economic data is important but if you are selling to consumers, you want to hear from consumers themselves as much as economists (Yes economists are consumers too but it is unlikely they make up the majority of your market unless you are selling calculators with special GDP features).

First and foremost are Consumer Confidence surveys. Basically they are surveys that ask consumers what direction they think the economy will go in and whether “today” is a good day to make a major purchase (house, car, major appliance). The idea behind the surveys is to gain insight into the consumer frame of mind. If bad times are expected consumer spending will dry up. If consumers think we are living in good times, they are likely to continue spending. To the bafflement of economists, on certain occasions consumer confidence can be high despite economic indicators (such as PDI) pointing in the opposite direction.

There are a number of sources for this information. Ipsos-Reid released their latest results on March 5, 2004 (http://www.ipsos-na.com/news/pressrelease.cfm?id=2075) What is especially helpful about the Ipsos-Reid numbers is that the results are provided by gender, age group, region, education level and income. This way you gain insight into consumer confidence based on some demographic elements of your target market. (For example if your target market is young people (18 to 34 years old) the latest survey reveals that as of February 2004 only 13.4% of this age group expect to curb their day-to-day spending habits in the next year while 34.5% expect to spend more.)

Decima Research also publishes a Consumer Confidence Index which includes income, age, region and gender details. (http://www.decima.com/research/WhatsNew/040312E.pdf) The index is based on slightly different questions and so the results are often not the same as Ipsos-Reid. Read carefully the questions used in each to determine which index is more appropriate to your particular needs.

For previous issues and a description of questions asked, search the news releases available at both web sites.

Ipsos-Reid:
http://www.ipsos-na.com/news/results.cfm?geo=1
NB: Ipsos-Reid conducts other consumer surveys beside the Consumer Confidence. Search or browse for any that may be appropriate.

Decima Research:
http://www.decima.ca/research/en/media_releases.asp

The Conference Board of Canada also releases a quarterly consumer confidence survey. Unfortunately their data is for the most part only made available to their own subscribers. Glimpses of it do appear in the Globe & Mail on occasion (e.g. Oct 15, 2003 B7). You can view a line graph of their index in the monthly J.C. Williams Group National Retail Bulletin (http://www.jcwg.com/nrb.htm)

There are numerous other consumer surveys beyond Consumer Confidence. While the information is not collected as regularly it is still insightful.

One frequent contributor to consumer behaviour data is Moneris Solutions. Moneris is Canada's largest processor of debit and credit card transactions. Their news releases provide the percentage increase in retail sales for specific retail stores and services for individual events (e.g. Le Carnaval de Québec) or holidays (Christmas shopping). This data reveals where consumers are spending their money under certain circumstances.

For example a recent release on Le Carnaval de Québec indicates that there was a 14% increase in retail sales at this year's event over last year's and that the sectors that are impacted the most by the festivities are gift/card/novelty stores (up 80% from two weeks prior), hotels (up 50%), and jewellery stores (up 28%).
http://www.moneris.com/index.php?context=/aboutus/mediacenter/pressreleases&id=58)

Clearly this information is of greater interest to businesses in Quebec City but other releases such as that from Dec 22, 2003 are of a more nation-wide appeal. This release revealed the % of Canadians who are last minute shoppers (38%) and the % who selected debit or credit card as the payment form they will use most often when shopping this season. (73%).
http://www.moneris.com/index.php?context=/aboutus/mediacenter/pressreleases&id=52

Still other releases are more generic in nature. For example in the April 16, 2003 release http://www.moneris.com/index.php?context=/aboutus/mediacenter/pressreleases&id=33   Moneris Solutions revealed that Two thirds (66%) of consumers have walked away from a potential purchase because a store's checkout was too crowded or too slow. Also, almost one third of Canadian consumers (31%) have decided not to purchase a product or service because the merchant did not accept the consumer's preferred form of payment. In 82 per cent of those cases, it was a debit or credit card payment format that was not accepted. Also credit cards are the most frequent choice in online (91%), phone (82%) and catalogue (62%) shopping situations.

To view all their releases go to the Moneris Solutions web site and select "view all releases":
http://www.moneris.com You will have to sift through some corporate announcement news releases but the statistical ones are easy to identify.

Moneris Solutions is not the only company to release consumer survey results via news releases. All three major credit card companies (VISA, MasterCard & American Express) employ the same technique and often reveal insights into Canadian shopping behaviour.

For example: a recent Master Card release identify the % of youth (16-25) and baby boomers (45-55) who make a point of seeking out and buying products and services from responsible companies (61% and 73% Respectively)

An American Express study found that while the majority of affluent Canadians earning over $200,000 don't think they live lavishly, they are twice as likely as most people to spend $2,000 per person on a vacation (48%), pay $250 on a hotel room (58%), drop upwards of $300 on an evening out to the theatre or a hockey game (32%), and think nothing of regularly doling out $100 for dinner (94%)

Use the Canada Newswire web site (http://www.newswire.ca ) and search on the company name to view the other releases from the major credit card companies. Once again you will have to sift through non-statistical corporate releases.

You can also use the keyword search feature of Canada Newswire to locate other consumer surveys. Simply use the search terms “consumer survey” and browse the result list. This method uncovers insights such as of % of Canadians who agree there is too much effort going into finding ways to sell things rather than actually making them better. (77%) (“BBM Canada Survey - Provides New Insights on Consumers” http://www.newswire.ca/en/releases/archive/October2003/16/c1200.html

Advertising and marketing trade publications can also provide a wealth of data on consumer behaviours. You are best to use a periodical database to search the two principle publications Marketing Magazine and Strategy Magazine. You can also use their web sites: http://www.strategymag.com/ and http://www.marketingmag.ca/ although subscriptions may be required to view some content.

The type of information included here covers everything from % of Canadians who believe a widely advertised product is probably good (17%)(“The risk of frost bite” Marketing Magazine, June 30/July 7, 2003, p22) to the average number of different loyalty programs a Canadian consumer belongs to (4.5) (“Auditing Loyalty”, Strategy Magazine, April 21, 2003, p7,8,10).

The Canadian consumer is a unique species. It is essential you understand some of its quirky behaviour. Your market research should primarily focus on your specific target market but do not loose sight of "the forest for the trees". By looking at consumers as a whole you can gain a better perspective of future growth and potential.

 

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 Think Tanks: Research the Research
 


Canada is home to a number of well-respected think tanks. A think tank is an organization that serves as a center for research and/or analysis of important public issues.

Many of their comprehensive reports can be very helpful in assessing market potential or industry issues. A sample of the type of reports available from Canadian Think Tanks include:

Gambling in Canada
(Canada West Foundation)

The Personal Security Index 2003
(Canadian Council on Social Development)

How Canada Stacks Up: The Quality of Work - An International Perspective
(Canadian Policy Research Network)

Dynamic Competition in Telecommunications: Implications for Regulatory Policy
(C.D. Howe Institute)


While these and other reports can be insightful it is important to keep in mind a think tank is essentially a company that does research for hire. Most have on-going sponsors either within the public or private sector. This is not to say their research is flawed or merely corporate propaganda but it does make it imperative that you ensure you recognize hard data from assumptions and that you carefully consider all the conclusions drawn.

One of the best ways to do this is to search for counter criticisms of the report in question. Search on the report name in Canada Newswire (http://www.newswire.ca ) or use a periodical database. If you cannot find the actual report name search on the institutes name to find criticism of its bias.

For example the Fraser Institute recently released the 2004 edition of its "Report Card on British Columbia's Secondary Schools". This annual report analyses publicly available data to rate and rank 279 of BC’s public and independent secondary schools. The Report Card’s Trend indicator provides evidence of progress (or lack of it) over time.
http://www.fraserinstitute.ca/shared/readmore.asp?sNav=nr&id=592

This information could be of interest to private education institutions as well as tutoring and training services. A quick search on Canada Newswire however reveals the ranking itself is disputed as is the methodology.


The B.C. Teachers Federation states

"Year after year, every major organization in the education community has raised serious concerns about the misleading nature of these rankings, said Neil Worboys, BCTF president. They are based on a narrow set of exam data, which is manipulated to create an imaginary statistic. They do not provide a legitimate measure of school quality...

Parents who take an active role in their children's education know that the qualities of a fine school go far beyond exam scores, Worboys said. The arts and athletics, scholarship and citizenship are all central to excellent schools.

The Fraser Institute rankings are only one element in a campaign to undermine public education and pave the way for privatization, Worboys said. Peter Cowley, the architect of the rankings, has said he doesn't believe that public education is the cornerstone of democracy. Given that government does not feed, clothe or house children, he questions why government should fund schooling at all.

Cowley and the Fraser Institute have a clear agenda, Worboys said, noting that their slogan is: Market solutions to public policy problems. By contrast, teachers value equity, access, quality, and co-operation, all factors that are antithetical to competitive market ideology."


Clearly there are differing opinions concerning this research.

As a business researcher you need to first recognize the bias on both sides and determine whether or not the report is still useful in your research. Using the same example as above you may decide that while you do not agree with the final rankings made by the Fraser Institute, the raw academic performance data is of value in assessing local market potential.

The best way to look for relevant Think Tank research for your own purposes is to use a periodical search (many libraries have periodical databases you can use) or search Canada Newswire (http://www.newswire.ca). Think Tank research is often released through the media. After all their purpose is usually to inform public policy.

You can also visit Think Tank web sites to browse their research directly. For a list of some of the larger thinks tanks in operation in Canada see:

MapleLeafWeb
http://www.mapleleafweb.com/directory/index.php?t=sub_pages&cat=112



SearchBug Directory
http://www.searchbug.com/directory.aspx/Regional/North_America/
Canada/Society_and_Culture/Politics/Policy_Institutes/


Think Tanks can be excellent resources for market research. Just be certain you research the research as well!


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 Small Business Stats Facts
 

Each Business Researcher Newsletter ends with a collection of five statistics related to Canadian small businesses. All of the following highlights come from the latest Global Entrepreneurial Monitor released in February 2004.
 

 

  1. How many start-up businesses were there in Canada in 2003?
     

931,420

Source: GEM (2004)

 

 

  1. How many people were involved in starting a new business in Canada in 2003?

1,767,870

Source: GEM (2004)

  1. What % of new businesses in Canada expect to have more than 20 employees within 5 years? What % expect to have no employees within 5 years (i.e. do not expect to hire)?

More than 20 employees: 31.5%
No Employees: 7.8%

Source: GEM (2004)

 

 

  1. What is the annual number of jobs provided by new firms in Canada in 2003?
     

744,743

Source: GEM (2004)

 

 

  1. What % of new firms between 2001 & 2003 were consumer oriented? Were business services?

Consumer oriented 35.2%
Business services 29.4%

Source: GEM (2004)

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URL: http://www.gdsourcing.ca/newsletter/newsletter7-2.htm
UPDATED: 05/18/2004
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