Report: Only three percent of Canadian factories have digitized their production

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A new BDC study released today finds that 39 percent of Canadian manufacturing businesses have started to embrace digital projects.

The study, which surveyed 960 Canadian SME entrepreneurs, found that only three percent of manufacturing SMEs have fully digitized their production.

“Our study clearly demonstrates that it pays to embrace the digital shift,” said Pierre Cléroux, chief economist and VP of research at BDC. “The Canadian businesses that have been early adopters of digital technologies have increased their productivity, reduced their costs, and improved the quality of their products.”

Quebec (45 percent), Manitoba and Saskatchewan (44 percent) top the list of provinces that have initiated the digital shift. British Columbia (39 percent) and Ontario (39 percent) sit in the middle of the pack, while Alberta follows with 35 percent and the Atlantic provinces trail behind at 32 percent.

While 17 percent of manufacturing SMEs are preparing to digitize production, the overall level of investment in these technologies remains low. The majority of Canadian SMEs have invested less than $100,000, compared with an international average of $261,000.

“Forty-two percent of Canadian manufacturing businesses have not yet initiated their digital shift. These businesses will be at a disadvantage against their competitors,” said Cléroux. “We are already witnessing the impact digital transformation is having in Europe and the U.S., where highly automated and flexible factories can now compete against low-cost factories in Asia.”

The main obstacles to implementation of digital technologies are the lack of a qualified workforce, excessive costs, and the difficulty in understanding the benefits.

The full study is available here.

Photo via Unsplash

Jessica Galang

Jessica Galang

Jessica Galang is BetaKit's News Editor.