SME benchmarking: Canadian Economy (NAICS 11-91)

Under this topic you will find information on average revenues, expenses and profits for small and medium-sized businesses in Canada's Canadian Economy (NAICS 11-91) . The data used for this topic were obtained through the SME benchmarking tool. You can use this information to see how your business measures up to the competition.


Revenues

Total revenues include revenues from the sale of goods and services, interest, dividends, commissions, rent and other sources of revenues. They exclude capital gains or losses, extraordinary gains or losses and equity in net income of related parties.

The average of annual revenues for small and medium-sized businesses in the Canadian Economy was $366.6 thousand in 2010.

For profitable firms, average revenues were $359.4 thousand and for non-profitable firms, average revenues were $399.2 thousand.

Profitable vs. non-profitable businesses: 2010
Canadian Economy (NAICS 11-91)
Industry average Profitable Non-profitable Total
Percent of businesses 81.8% 18.2% 100.0%
Total revenues ($ thousands) 359.4 399.2 366.6
Total expenses ($ thousands) 290.0 463.4 321.6
Net profit/loss ($ thousands) 69.3 -64.2 45.0

Source: Statistics Canada, special tabulation, unpublished data, Small Business Profiles.

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Expenses

The average of expenses for small and medium-sized businesses in the Canadian Economy was $321.6 thousand in 2010. For profitable firms, average expenses were $290.0 thousand and for non-profitable firms, average total expenses were $463.4 thousand.

Expenses can be divided into two main types: cost of sales (or direct expenses) and operating expenses (or indirect expenses).

Cost of sales refers to costs related to the principal activity of the business. Examples of these direct expenses include the materials used to manufacture a product or deliver a service and the labour costs associated with the production of the product or delivery of a service.

The average value of cost of sales items for the Canadian Economy are outlined in the table below. The cost of sales itself is calculated by adding wages and benefits, purchases, materials and sub-contracts, and opening inventory and then subtracting closing inventory.

Cost of sales: 2010
Canadian Economy (NAICS 11-91)
Expense Item Value in
$ thousands
% of Total
Revenues
Wages and benefits 19.6 5.4%
Purchases, materials and sub-contracts 115.9 31.6%
Opening inventory 34.6 9.4%
Closing inventory 38.5 10.5%
Cost of sales (direct expenses) 131.5 35.9%
Source: Statistics Canada, special tabulation, unpublished data, Small Business Profiles.

Operating expenses refer to all expenses not directly related to the principal activity of the business. Examples of these indirect expenses include labour charges for support staff, rent expenses, and charges for advertising and promotion activities.

The average value of operating expense items for the Canadian Economy are outlined in the table below.

Operating expenses: 2010
Canadian Economy (NAICS 11-91)
Expense Item Value in
$ thousands
% of Total
Revenues
Labour and commissions 66.1 18.0%
Amortisation and depletion 13.1 3.6%
Repairs and maintenance 8.4 2.3%
Utilities and telephone/telecommunication 8.9 2.4%
Rent 13.0 4.0%
Interest and bank charges 7.2 2.0%
Professional and business fees 10.8 3.0%
Advertising and promotion 4.3 1.0%
Delivery, shipping and warehouse expenses 1.0 0.0%
Insurance 4.0 1.0%
Other expenses 53.3 14.0%
Operating expenses (indirect expenses) 190.1 51.8%

Source : Statistics Canada, special tabulation, unpublished data, Small Business Profiles.

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Net profit/loss

Net profit/loss is the profit or loss resulting from normal business operations, recorded before income taxes, extraordinary items and other income not related to normal operations. For unincorporated firms, the owners' or partners' salaries and withdrawals are included.

The percentage of small and medium-sized businesses that were profitable in the Canadian Economy in 2010 was 81.8%, with 18.2% of firms failing to turn a profit.

The average annual net profit/loss for small and medium-sized businesses in the Canadian Economy was $45.0 thousand in 2010, which represented 12.0% of total revenues for small and medium-sized businesses in the .

For profitable firms, the average annual net profit was $69.3 thousand and for non-profitable firms, average net loss was $-64.2 thousand.

The gross margin for the Canadian Economy was 0.0% in 2010.

Gross margin is calculated as (total revenue - cost of sales) / (total revenue) * 100. This percentage provides a relative measure of profitability or profit margin.

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Notes on SME benchmarking data

The data in this section come from Statistics Canada's Small Business Profiles which are produced using a sample of tax returns filed by incorporated and unincorporated businesses with the Canada Revenue Agency. The data appearing in this section are based on tax data from 2010. The data were obtained through Industry Canada's SME benchmarking tool.

In this section, small and medium-sized businesses are defined as those having annual revenues between $30,000 and $5,000,000.

The SME benchmarking tool provides more in-depth data for small and medium-sized businesses than what is offered here. Included among its features are options to:

  • view statistics by province
  • view statistics by business type (incorporated, unincorporated or all businesses)
  • segment the industry based upon revenue levels (which allows you to compare the performance of your business to averages for firms of a comparable revenue level)
  • view balance sheet data, and
  • view up to 12 financial ratios

Footnotes

Footnote 1

X = Suppressed to meet confidentiality requirements

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