Developing products in Canada is no easy endeavor. Not only does a company engaging in R & D activities have to deal with the everyday problems that arise with running a business, but also the financial black cloud overhead.
Industry Canada recently released their report on Credit Conditions Faced by Small and Medium-Sized Enterprises Investing in Research & Development. This report outlines how important Research and Development Intensive (RDI) small and medium-sized enterprises (SMEs) are to the general Canadian economy and to innovation competitiveness with other countries. This is not a surprise to those in the innovation field, but what may come as a surprise is that these imperative companies have greater difficulty than their non-RDI counterparts when it comes to attaining financing.
Here are a few of the highlights outlined in the report:
After reading this report, it comes as no surprise that Canada ranked 14th out of 17 countries on the Conference Board of Canada innovation report, receiving a “D” rating. It may have since improved, since the last report was completed in 2004, however we will have to wait until the next report to compare.
Not all news is bad new! Since financing is hard to come by for these businesses, the way to turn is toward government funding. The Canadian Government has set up a variety of innovation reward programs to assist companies in their R & D activities. Programs like the SR&ED tax program are available to Canadian companies doing innovative work in Canada. SR&ED alone offers around $5 billion a year in benefits – funds that companies may be missing from by relying strictly on traditional financing options.
Make sure to maximizing your SR&ED claims for the highest benefit possible. Call a BeneFACT consultant today and discover possible untapped funds.