Small-business confidence up but ‘insufficient demand’ drags: CFIB report

Cautious spending, online sales, knock-off brands — a mix of “insufficient demand” is a top limit on small-business growth, a new report finds.

The Canadian Federation of Independent Business released an update on business optimism on Thursday. Forty-one per cent of Manitoba respondents — in a pool of 86 responses — cited insufficient demand as their top growth constraint.

It comes as analysts track higher debt in the province and a near flatlining of sales.

“Price sensitivity remains high,” said Brianna Solberg, CFIB director of legislative affairs for the Prairies.

She pointed to corporations such as Amazon: they have massive reach and can keep prices low compared to small businesses seeing “every line item in their budget increase.”

“They’re struggling with businesses who can scale,” Solberg said of CFIB members.

Ren Fournier has clocked a persistent trend of online items competing with those in store. Customers might scour for deals on the internet, not bothering with local shops, the Primos Toys assistant manager said.

“In today’s world, everything’s just more expensive,” Fournier continued. “It’s hard to want to… go to the mall and just spend money.”

Manitoba led other provinces in year-over-year spending by the end of 2025, according to the Retail Council of Canada.

The entity uses data from Statistics Canada and Moneris. By December’s end, businesses nationally saw a spend decrease of roughly one per cent. Manitoba, however, saw a two per cent increase — something nullified when you account for inflation, said John Graham, the Retail Council’s Prairies director of government relations.

(Statistics Canada alone clocked $70.01 billion in retail sales nationally in December, down from $70.02 billion the year before. Manitoba saw a drop to $2.384 billion from $2.385 billion during the same time period.)

“What we’re seeing is that margins are getting tighter and tighter,” Graham said. Buying value items, such as knock-off brands, is trending. It’s harder for retailers to be profitable, he added.

He’s predicting a drag on overall retail sales this year: “We’re really interested (in what) the combined impacts of a slowing economy and trade uncertainty with the U.S., and higher consumer debt, will have on spending.”

Consumer confidence drives the economy, noted Loren Remillard, president of the Winnipeg Chamber of Commerce.

Nationally, 62 per cent of Canadians perceived economic conditions as poor or very poor in January, a Leger poll found. However, Canada saw retail sales of $837.2 billion in 2025, up four per cent from the prior year.

“People are spending, but there is… a cloud of uncertainty,” Remillard said, highlighting shifting geopolitical trade, including with the United States. “That’s translating into businesses being cautionary as to ‘How much do I expand? How much do I grow?’”

Meanwhile, debt is on the incline. Credit reporting agency Equifax tracked a 2.72 per cent increase in Manitobans’ debt during 2025’s final quarter, to an average $18,716 (excluding mortgages).

“Consumers are definitely aware things are a little bit more expensive,” said Kathy Catsiliras, Equifax Canada’s vice-president of data and analytics. “(But) where we normally expect a spike in missed payments in January, we haven’t seen that.”

Equifax didn’t have January data available Thursday.

Mortgage renewals are squeezing some Manitobans’ wallets, noted Laurie Boudreau, a broker with Castle Mortgage Group. She’s handling cases where people who got or renewed their mortgage during the COVID-19 pandemic are now, upon new renewals, seeing monthly price raises in the hundreds of dollars. (Interest rates have climbed since the pandemic.)

Increased debt loads and mortgage renewals are a “double whammy” on the pocketbook, Boudreau said.

Manitoba is “by far the best place” to buy a house, she said, citing lower prices than elsewhere in Canada.

But it’s “not as affordable as it used to be,” Boudreau added.

gabrielle.piche@winnipegfreepress.com