New Year – New Opportunities

We often set New Years’ resolutions, but this year especially, we need to take stock of the new opportunities and threats facing ourselves and our businesses in 2021. These opportunities and threats will depend on where your business is in its life cycle, as well as your personal plans. Although the pandemic is not over, we have a better understanding of COVID-19’s impact and are looking forward to that light at the end of the tunnel.


Interest Rates and Company Value

The pandemic has affected the Canadian economy resulting in lower interest rates and potentially depressed values for businesses. This could be an opportunity to purchase an established business at a reduced price with better vendor-financing terms than before the pandemic. There may also be an increased supply of businesses open to a sale as current owners wish to make a shift after weathering months of the pandemic. Of course, many businesses were able to weather the pandemic relatively unscathed or made successful pivots showing potential buyers they are “recession-proof” and therefore enjoying a boost in value.

As a business owner looking to sell, the favourable interest rates could provide an opportunity. However, if your business’ value was depressed by the pandemic, the sale price may not be adequate for you to go ahead with the deal.

While the ability to buy or sell can be an opportunity to some and a threat to others, there is still a lot of uncertainty which has led to a “mixed bag” of corporate valuations. More than ever, every transaction and company is different leading to different valuations within otherwise similar businesses. The uncertainty has also led to banks being weary of historical results and investors being less willing to complete transactions due to the continued uncertainty in the market. The key for 2021 is to keep your eyes open for the opportunities to gain synergies or get into an established business, while being aware of the potential roadblocks. 2021 could still be a great time to buy or sell.

Skilled Labour

The actions and struggles of your competitors throughout the last nine months can lead to unique opportunities to access skilled labour. Employers who kept employee safety, benefits, and incomes at the forefront of their pandemic strategies could benefit from now having access to the staff of companies that did not have the same focus. With the historically low supply of skilled construction labour, this could be a game changer for the industry.

The Pivot

Many companies who benefitted from increased sales and value during the pandemic were those that were able to pivot their service offerings or operations to suit the restrictions that came into place. With the pandemic ongoing and Canadians being forever changed by a lock down and long period of pandemic restrictions, companies that can pivot to fill gaps and keep up with trends could reap significant rewards. For example, homes with separate home office spaces are in more demand than ever as people wish to continue working from home in some capacity even after the pandemic is over. This is an opportunity for home builders and home renovators to fill that need as well as for companies to allow their operations to shift to allow at least some remote work.

Continued and New Government Assistance

Some of the pandemic government assistance has been extended into 2021, although the details were not known at the time of writing this article. Continued or new government assistance announcements could provide your company with further resources to aid operations. For example, the wage subsidy (CEWS) applications for the periods up to the end of November have an application deadline of January 31, 2021, however an extension of the program has also been announced to June 2021. There has also been an announced expansion to the CEBA loan program.


Lack of Liquidity or Insurance

The pandemic taught Canadians a true lesson in uncertainty and the need for emergency resources. With many out of jobs and companies faced with reduced revenue and increased costs, having adequate liquidity was what got many through the lock down period and the continued restrictions that followed. As the pandemic continues, those companies who start to run low on liquid resources may still not be spared. And should the worst case happen, and an owner get ill or pass away, companies and families without adequate liquidity or insurance could be faced with a significant tax burden. This is a very difficult thing to think about and discuss, but it is advisable for those with significant assets (corporate and personal) to meet with their trusted advisors to calculate their tax burden and determine whether they require additional liquid assets or insurance. This ensures their family will be protected should the unthinkable happen. In a time with increased health risks, this becomes even more important.

Supply Chain Issues

While construction seemed to miss the large-scale effects of the pandemic that other industries faced, like tourism and food service, there are concerns starting to arise. Due to shutdowns in the supply chain and changes in consumer purchasing, the industry may face new challenges in 2021. This is already starting to be felt with the lumber shortages and therefore price increases due to homeowners diverting travel funds and increasing their home reno projects during lock down.

Project Pipeline

With the government focused on COVID assistance programs, there is some concern that infrastructure spending may be less of a focus. Non-government consumers may also be holding off on projects due to the continued uncertainty and depressed economy. All this could lead to your project pipeline shrinking significantly. While keeping staff busy is important for morale, taking on jobs to fill the pipeline that have low or negative margins could lead to overall net losses. For companies with already depleted resources, some jobs run at a loss could put them over the edge. Additional, creative efforts may need to be an early focus in 2021 to ensure your pipeline is full of profitable work. Having several case-based projections to better understand your company’s breakeven will also be beneficial.


Whether something is seen as an opportunity or a threat depends on your point of view and position in the industry. Those who have the most success in 2021 will be those who are able to adapt quickest to take advantage of any opportunity or dodge any threat they face. As those opportunities and threats arise, remember to turn to your trusted advisors for advice to help maximize the results of any new direction. I believe that like 2020, 2021 will continue to be a year focused on pivots.


You may also be interested in “Financing Options for Your Construction Business”. Click here to read more.