Tariffs: An opportunity to adopt AI and boost your efficiency
They say that a crisis can also be seen as an opportunity.
The tariff crisis we are living through right now is directly affecting the competitiveness of Canadian businesses.
But while these may be difficult times, it can also be seen as a chance to invest in your operational efficiency, particularly in tools that integrate artificial intelligence (AI).
According to a recent BDC survey, a number of companies still have a ways to go in this regard. Making this type of investment could give them a competitive edge in an increasingly complex business environment.
Bolster your operational efficiency
BDC’s Research and Market Intelligence team conducted a survey of 536 Canadian small businesses in January 2025. The results show that there’s still work to be done when it comes to increasing their efficiency.
Just
14%
businesses claim to be very efficient
After three years of decline, annual growth in labour productivity in Canada improved 0.6% in 2024. Meanwhile, in the United States, it jumped 2.3%.
Another factor hurting Canadian businesses is the rising cost of labour. In 2024, businesses paid almost 26% more in labour per unit of output produced than the did in 2020, an unprecedented increase.
Clearly, there are many gains to be made by investing in operational efficiency, notably with solutions that integrate AI.
34%
of businesses never review their processes
or only do so if a problem occurs
Assess your options
To determine where to invest to improve your efficiency, your management team first needs to be able to take a step back from day-to-day operations to evaluate your processes and see which areas can be improved.
You also need to take the time to learn about solutions that exist on the market.
In addition, it’s a good idea to see what your competitors are doing in your province, across the country and elsewhere in the world. To be an industry leader, you have to keep a close eye on the market, both in terms of strategy and technology.
A good starting point is to compare your productivity per employee to businesses that are similar to yours. You can try our workforce efficiency benchmarking tool to get a free report.
66%
of businesses are considering adopting AI,
mainly to boost their efficiency and gain a competitive edge
Target small investments for big gains
The BDC survey revealed that a majority of businesses could benefit from AI, particularly in marketing and sales, as well as in content creation and curation.
But actually, there are a many more aspects of running your business in which you could use AI tools, such as sales tracking, project management and bookkeeping. For example, if your business deals with a lot of supplier invoices, you could save hours with a tool that automatically enters them into your accounting software.
Ideally, you should look for mature, lower cost AI tools that can add significant value. Opt for small, accessible solutions that will allow you achieve gains while carefully managing risk and guiding your teams through the change.
However, it’s key that you address the following questions when it comes to AI governance: What company data will this solution have access to and how will it need to be managed to avoid problems?
You can use this checklist to boost your chances of efficiently implementing AI.
Collaborate to develop tools
If you determine that there isn’t a tool on the market that meets all of your needs, you can develop one. However, given the costs and risks of going that route, it should only be considered as a last resort.
One avenue to explore in launching this type of project is collaborating with partners. For example, major buyers could work with their suppliers to create solutions that are useful for everyone. Or an industry association could gather several business with similar needs to develop a tool.
If this isn’t possible, your business could take smaller steps by developing proofs of concept internally before taking on a complex implementation project.
16%
of the businesses surveyed use an ERP system
Implementing AI across your business
Once you’re familiar with AI and enjoy using it, you can consider taking on larger projects. These will help you generate larger gains, but will also call for bigger investments. For example, you could purchase smart production equipment or expand AI throughout your operations. However, before launching this type of project, your business must have achieved a certain level of operational efficiency with data maturity and integrated systems.
Many businesses invest in enterprise resource planning (ERP) systems, which allow them to manage all their different business functions, such as finance and accounting, sales, production and warehousing. Once all of your departments are connected, you will be able to use AI to manage your business even more efficiently.
9%
of the businesses surveyed
aren’t motivated to integrate AI
Move to the head of the pack
While AI is becoming increasingly prevalent in businesses, it’s important to assess the gains that it offers.
Businesses who choose not to adopt AI will find themselves lagging behind in terms of efficiency and will therefore be less competitive.
However, by investing to improve your efficiency, you will set yourself apart from other industry players, both in your province and across the country. This will put you in a better position to succeed internationally despite tariffs and develop new markets in different countries.
Next steps
To help you jump-start the process of adopting of new technology, it may be helpful to call on experts in the field.
Please feel free to contact us if you have any questions.
Interested in participating in a BDC survey?
BDC regularly conducts survey research among its proprietary ViewPoints panel, which is composed of small and medium-sized business owners. The BDC ViewPoints panel survey results are regularly shared with panel members and are sometimes made available to a larger public at BDC Studies and Research.
If you are interested in voicing your opinion on current topics related to entrepreneurship, join BDC’s ViewPoints panel.