Small businesses in Canada are a resilient bunch according to findings published in a Business Development Bank of Canada (BDC) newsletter.

With the markets going on a rollercoaster ride as of late, and the rise of the Canadian dollar for much of the last year, it is small businesses who are managing better than their larger cousins.

"The number of clients having temporary or permanent difficulties in repaying their loans remains low and has changed very little in the past three years," says Jerome Nycz, Vice President, Strategy & Planning. "Although 2008 is far from over and we are continuing to monitor the situation closely, so far we have seen that entrepreneurs are very resilient and most can adjust to market conditions."

However, the news is not all roses for small businesses, as those in the manufacturing sector are a little more susceptible to the current turns in the market. Businesses that do much of their trading with the United States are the most at risk.

"SMEs that moved into export markets in recent years were betting on the proximity and ease of trading with the United States," said Nycz. "Because of their generally lower productivity, the rapid increase in the value of the Canadian dollar and fierce global competition, SME manufacturing exporters who relied too heavily on the U.S. market are suffering the consequences today."

As a result of the tough conditions, BDC has offered its manufacturing sector clients the option of postponing their loan payments for six months.

Small businesses that are able to prosper through bad times are the ones which have a good business plan in place and are likely to pay back the loans when times get better, according to BDC,

"By offering this financial respite, we wanted to give our entrepreneur clients the leeway they need to review their business plans and export strategies and look at ways to improve productivity," Mr. Nycz explained.

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