Do we really need to stop two young girls, aged five and seven, from selling lemonade to thirsty cyclists on a popular bike path in Ottawa because they lack the proper permits? Do we need to fine a Winnipeg bookstore and café for not installing grease traps on sinks and dishwashers like a full-fledged restaurant? Do we have to make it difficult for a PEI couple to sell their farm to "non-residents" when they're ready to retire?
(Photo: Ablestock.com via Getty Images)
These are just a few of the exasperating regulations singled out for ridicule by the Canadian Federation of Independent Business (CFIB) during this year's eighth annual Red Tape Awareness Week. The CFIB also issued a challenge to each of the provincial governments: One rule in, one rule out. In other words, for every new strand of red tape a government introduces, it would commit itself to eliminating an equivalent amount of existing red tape.
No sooner was the glove thrown down than it was picked up by the government of Manitoba, which is proposing just such a "one-for-one" rule for the province. In fact, it will adopt an even stricter two-for-one rule until 2021 to help kick-start the process, according to deputy premier and Justice Minister Heather Stefanson.
Manitoba is not the first to make cutting regulations a priority. The Harper government adopted a federal one-for-one rule in 2015, although it was narrower in scope than what the province of Manitoba is proposing.
(Photo: Image Source via Getty Images)
The Quebec government, for its part, adopted an action plan in the fall aiming for a 10 per cent reduction in the cost of regulation by 2018. According to the Canadian Federation of Independent Business, this follows a previous reduction of the cost of regulation for businesses of 20 per cent from 2004 to 2014.
Most impressively, the government of British Columbia has been counting and publicly reporting on the number of regulatory requirements for citizens and businesses since 2001. By 2004, it had reduced the number of such requirements by 40 per cent, and has reduced it a further 12 per cent from the 2004 baseline, for a reduction of over 47 per cent since 2001. This lightening of the regulatory burden has likely contributed to B.C.'s strong economic growth in recent years.
U.S. President Donald Trump, Jan. 31, 2017. (Photo: Kevin Lamarque/Reuters)
President Donald Trump promised last week to "cut regulations by 75 per cent, maybe more," not in order to endanger workers or the environment, but to make it easier to run companies and build factories in the United States. This week, he added some specifics to this promise with an executive order requiring agencies to cut two existing regulations for every new rule introduced.
Red Tape Awareness Week may be over now on this side of the border, but that doesn't mean we should forget about this problem for another year. Other provinces should follow the lead of Manitoba, Quebec and British Columbia and reduce their needlessly heavy regulatory burdens. They should do so for the sake of all Canadians, from the owners of businesses large and small, on down to little girls who just want to run a lemonade stand without being harassed.
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These kids are ADORABLE, but their lemonade stand is in the middle of a field. For brick-and-mortar businesses, picking a highly-trafficked area in a good part of town (or your neighborhood) is key to your success. Something else to consider: making sure you have enough space to grow or expand. For B2B or online businesses, having good search engine optimization is your equivalent to a prime location. You'll want to make sure your customers can find you where they hang out the most -- online.
It's crucial to assess your operating costs as well as your competition when pricing your goods and services. It may be hard to strike a balance between pricing high enough to turn a profit but low enough to be competitive in the market. You'll have to figure out your priorities: In the lemonade stand analogy, lemons and sugar may be more laborious than using powdered mix, but there's a value in being able to market your product as "all-natural." Consider manufacturing differently or making operational changes to lower your pricing, but don't forget to consider how those changes might affect your bottom line -- and your brand's identity.
Here's a great scenario: Word has gotten out about your lemonade, and business is booming. But you seemingly can't squeeze enough lemons to keep up with demand. Time to bring in some help! As you scale your team, you might want to consider hiring for the skills you lack or areas in which you are seeing opportunities for growth. Send dispatches to trusted friends and family and post job openings online (don't forget social media!), and make sure you ask the right questions in interviews so you hire people who will stick around. See this great article in Inc. for a nitty-gritty guide to hiring.
Ok, so shouting might not be the best advertising option, but you get the picture. Find free options first, like emails, social media and flyers. Then bring out the big bucks if necessary -- online ads, newspaper ads and sponsored content (ahem) can really go a long way.
When you were a kid, Mom and Dad might have given you the supplies to start your lemonade stand, but everyone knows that in the real world, the cardinal rule of basic economics applies: there's no such thing as a free lemonade. It's important not to take on loans that will hinder your profits too much. This mistake can affect you years down the road, even after you're way clear of the start-up phase. Check out this guide to funding your nascent business, whether you choose to crowdfund, apply for an incubator, or seek venture capital.
Once you've made your profit, don't let it all go to salaries and savings accounts. Instead, pick stocks and bonds you'd like to explore and consider hiring an investment manager to help with your portfolio.
Your product or service is the lifeblood of your business. If you suddenly swap fresh lemon for powdered mix to meet a growing demand of customers and cut costs, don't be surprised if your repeat business declines. Prioritize preserving the quality of your product or services over scaling and make sure your growth plan has mechanisms in place for possible strains to your resources and manufacturing process.
Follow Jasmin Guénette on Twitter: www.twitter.com/JasminGuenette