August 6, 2021, was a crucial day. The Canadian government made a significant announcement on this day, revealing federal-wide measures. To take economic relationships with native entrepreneurs and communities, politicians decided to implement new measures. With these measures, the number of federal procurement increases, and businesses nationwide will have more options to get on the new level. But how exactly does it work? What benefits do business holders get from these changes? Keep reading, and we will explain all the information you need to know.
Naturally, we may call a business indigenous-owned if more than 50% of its shares are owned by individuals registered as First Nations members, Metis or Inuk or remain under the Indian Act of Canada. These people control more than 94,1% of indigenous businesses in the country.
Back in 2020, people contributed over $50 billion to the economy. Over the following years, this number grew, and now we can say it's more than $100 billion per year. Plenty of small companies grew from a corner in the basement to a solid store in the town's center.
The year 2021 was game-changing due to new initiatives. First, it's a collaboration between Public Services and Procurement Canada and Indigenous Services Canada (ISC) with the Treasure Board of Canada Secretariat (TBS). Second, federal departments and agencies received a mandatory requirement from the country's government. According to it, a minimum of 5% of the total value of contracts must be held by native businesses.
Moreover, this innovation includes public reports and will be phased over three years. Everything should be successfully implemented within three years. Why so long? Because this is a strategy that helps to secure government projects and increase protection. Implementing this requirement makes indigenous projects more attractive for Public Services and Procurement Canada (PSPC) as the value grows for potential contractors and the government. Who will miss a chance to get a governmental contract and raise capital?
Despite the fact that the government set the strategy and made the first step to implement it, there are still several challenges for the business to face. For example, access to working capital is the first issue for businesses, and this happens for several reasons.
The next issue is related to the remoteness of the communities. The fact that they are located in Northern Ontario, Nunavut, Labrador, or the Northwest Territories creates several problems.
Having fewer financial resources leads to a smaller asset base. Unfortunately, this problem remains for indigenous-owned companies, and they need help with several issues while trying to raise capital and sustain the business.
How to ensure that government projects will run without force majors or factors that may damage them? The key to that is high cyber security and the ability to prevent attacks from intruders.
Building a partnership with MBS allows for securing governmental projects with a stable strategy. Cooperation with experts will enable experts to analyze all possible risks and use preventive measures if needed. MBS is an indigenous business growing extremely fast, earning trust among clients. People trust us because they see the real result of our work. You can rely on us if you hold an Indigenous business in Canada. Make a call and receive the highest level of protection for the company.
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