Admittedly, we Saskatchewanians enjoy the attention of the big players, those mega corporations who choose to do business here. We have seen Viterra, Cargill, and BHP signal strong investment in Saskatchewan in the past year, but smaller players have a surprisingly massive impact as well.
“Small to medium-sized companies (SMEs) are absolutely the backbone of our economy,” says Alex Fallon, CEO of the Saskatoon Regional Economic Development Authority (SREDA). Saskatchewan has the second highest number of small businesses per capita in Canada, right after British Columbia, according to the Ministry of Trade and Export Development (TED). As of October 2021, there were 146,016 small businesses in Saskatchewan, which equates to 98.9 percent of almost 150,000 total business enterprises in the province, or 124 per 1,000 people. TED and SREDA define SMEs as companies with less than 50 employees. These companies account for over 30 percent of employment in the province.
Fallon credits Saskatchewan’s strong entrepreneurial spirit in part, to the pluckiness of early settlers who had to make a go of it. Small remote settlements needed every type of business. He also attributes that spirit to an interesting phenomenon unique to a province like ours. Forget the common mythology about six degrees of separation. Here, perhaps, we have only two degrees of separation.
“Everyone knows everyone and if you need a meeting with this supplier or that customer, or the mayor or the CEO of that company, it’s actually much easier to get that meeting, that face time, when the relationship has roots in Saskatchewan,” Fallon observes, “in Toronto or Vancouver, you’re one of millions, and getting that meeting with the mayor may be a vain, or much delayed, hope.”
“It takes an hour to get across those cities. Here you can meet with five people in an hour. Everyone is connected, so because of the relationships and the referrals, the speed of business is quicker. It’s an advantage for smaller cities like Saskatoon and Regina,” Fallon adds.
Our relatively low population density translates into another advantage. Because we have a smaller market at home, many companies have increasingly been looking at exporting their product across Canada, into the States and internationally. “As a result, Saskatchewan has become one of the leading exporting provinces in Canada. That’s a big opportunity for Saskatchewan,” Fallon says.
COVID-19 brought challenges to the economy, but uncertainty and job insecurity during the pandemic netted some positive impacts as well. Entrepreneurship went up, Fallon notes. People who lost their job didn’t have much to lose by starting a new business. People who were worried about losing their job wanted a back-up plan, and some decided to manifest that idea they had long been nurturing and start a new business on the side.
Several other factors appear to be signalling greater momentum in our economy. Saskatchewan’s economy is significantly commodity based. Commodity prices move up and down, creating cycles of growth and decline. Currently, Russia’s war on Ukraine, is driving up demand for Saskatchewan wheat, canola, potash, and uranium. BHP’s $7.5 billion investment in the Jansen potash mine will have a trickle-down effect as more jobs are created. As trades, supply chains, logistics, and transportation expand, more cash flows into retail.
“I think we are moving into that kind of growth boom cycle,” Fallon says. “SMEs grow with it because the opportunity is bigger, the economy is growing, and they can scale up, increase employment opportunities, take on more customers and deliver more services.”
TED reports that Saskatchewan’s manufacturing sector saw 33 new small businesses start up during 2021. This represents an increase of 1.9 per cent in new manufacturing small businesses. This was the largest increase of all Saskatchewan’s economic sectors last year.
SREDA is seeing growth in various sectors, including the tech sector in Saskatoon. 7shifts is a great example. “Jordan Boesch and his partner Andrea started 7shifts and they’ve grown to about 100 employees,” Fallon says. A recent Toronto Star story noted that 7shifts grew its customer base by 10,000 locations in 2021 alone. “Companies like that inspire the next generation and help people believe they can start a tech company in Saskatchewan, not just San Francisco,” Fallon adds.
Anyone feeling inspired to start their own small business will find helpful guidance and valuable research at the SK Startup Institute. Launched in May by SREDA, this program takes hopeful entrepreneurs through the finer points of starting and growing their business. “For example, you need to do a name search and register your name, and then you need to incorporate your company, and you need to decide if you’re going to be a sole proprietor or a partnership, and you need to get a GST number and a website; those are some of the steps to start your business,” Fallon explains.
“Since the May launch of SK Startup, SREDA has been inundated with phone calls, emails, and walk-in traffic,” Fallon says, “I’m calling it an entrepreneurship boom, because peoples’ confidence is back, they’ve come through the pandemic, life has changed, the economy is growing, and they see opportunity.”