PwC Survey reveals that youthful exuberance is winning the day with private companies in Canada



    TORONTO, Oct. 24 /CNW/ - PricewaterhouseCoopers' (PwC) 2007 Business
Insights(TM) Survey reveals that Canada's private companies continue to be
confident and profitable despite the US economic slow down. And while this is
good news, the survey also shows that the fastest growing companies are young,
innovative and willing to take risks, painting a worrying picture for any
business content with the status quo.
    According to the survey of 420 Canadian private company leaders, the
fastest growing companies are more likely to be under 10 years old and much
less likely to be more than 20 years old. Furthermore, once companies have
been operating for more than 50 years, they are more likely to show decreasing
profits, top-line shrinkage and increasing pressure from competition.
    But age isn't the critical factor, it's the tactics businesses are using
at different stages of their life-cycle. Companies with increasing
profitability and top-line growth of more than 15% report they are
participating in an innovative range of activities which are contributing to
their success, including selling or sourcing overseas, generating revenues
from new sectors, entering new markets or developing new products and having a
significant percentage of staff working on innovation related projects. The
survey also shows that once businesses have been established for more than 50
years, they are also most likely to report that they "do not innovate."
    "All companies would do well to take a closer look at the behaviours
exhibited by the most successful companies and consider what they need to do
to reinvigorate their business approach," says Eric Andrew, PwC's Private
Company Services Canadian leader. "Business leaders concerned about what they
may lose with higher risk ventures must also consider what they could lose by
carrying on with business as usual."
    The Business Insights Survey also followed up on some key trends seen in
previous reports and introduced new topics of discussion. These include:

    Outlook

    Confidence among private business leaders in Canada remains solid.
Seventy-seven percent of respondents report they expect business to get "a lot
or a little better" in the next twelve months.
    The biggest change from 2006 was the drop in the number of Albertans
reporting they expect business in the next 12 months to "get a lot better." In
2006, 45% of respondents gave this response but in 2007 the figure has fallen
to 26%.

    Challenges

    Labour is the primary challenge respondents expected to face in the next
year but again there were wide regional differences. In Alberta 61% of
respondents rank it as one of their three biggest challenges, which is down
slightly from the 65% who cited it as a problem in the last twelve months. The
spread of responses is more even in Ontario with labour, currency and the
economy cited by a similar percentage of respondents.

    Growth Strategies

    For the third consecutive year, growth and expansion is the main strategy
for Canadian companies. Overall, 75% of companies are striving for growth in
the next 12 months up from 70% last year.
    The survey shows that over 40% of respondents are looking to expand into
new markets as a short- and medium-term strategy and half of all companies
sell and/or source overseas. The number one reason for their overseas activity
was to access a larger market for products and services.
    Andrew adds, "Canada's private companies, particularly those in the
fastest growing and most successful groups, are leveraging international
opportunities with good results."

    Corporate Social Responsibility (CSR)

    The survey found that while 76% of respondents agree there's a business
benefit to having sustainable business practices, only one in three think the
costs of sustainable operating practices outweigh the benefits. Only 16% are
running a CSR program in their community, 62% don't have a policy for
sustainability and 43% don't even consider it in their long-term planning.
Finally 41% of respondents don't think climate change will ever impact their
company.
    "Companies who are early adopters in addressing their environmental
impacts can build Canada's next competitive edge. The challenge for businesses
is to find innovative ways to turn these forces to their advantage," concludes
Andrew.

    PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance,
tax and advisory services to build public trust and enhance value for its
clients and their stakeholders. More than 140,000 people in 149 countries
across our network share their thinking, experience and solutions to develop
fresh perspectives and practical advice. Now celebrating 100 years of
excellence in Canada, PricewaterhouseCoopers LLP (www.pwc.com/ca) and its
related entities have more than 5,200 partners and staff in offices across the
country.
    "PricewaterhouseCoopers" refers to PricewaterhouseCoopers LLP, an Ontario
limited liability partnership, or, as the context requires, the
PricewaterhouseCoopers global network or other member firms of the network,
each of which is a separate and independent legal entity.





For further information:

For further information: on the 2007 Business Insights Survey please
contact Carolyn Forest, carolyn.forest@ca.pwc.com, (416) 814-5730; or visit
www.pwc.com/ca/businessinsights

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