JANUARY 1997 Edition
MOST PROFITABLE
Among larger Canadian enterprises, the most profitable in
1995 were firms engaged in computer manufacturing, electronic computing
and peripheral equipment servicing, and the provision of computer
programming and systems analysis services. The median rate of return was
22.4%. They were followed closely by chemical fertilizer (excluding
potash) and explosives manufacturers (22.3%) and industrial inorganic
chemicals manufacturers (18.5%). Among smaller firms, incorporated
offices of physicians, surgeons and dentists were the most profitable
with a median rate of return of 25.9%. Next were sawmills and
manufacturers of planing mill products with a median return of 17.4%.
LEAST PROFITABLE
The least profitable of the larger firms included
advertising agencies, contractors doing building interior and exterior
structural work, and industrial and heavy engineering general
contractors. The least profitable small enterprises included paper and
paper products wholesalers and the paint and varnish manufacturers.
LIBRARIES
It was once forecast that television would destroy
reading in Canada, but it hasn't happened. In 1968, viewers had about
2,000 channel-hours a week to watch. Today, close to 8,000 channel-hours
are broadcast each week in the larger Canadian cities. So what has
happened to libraries? In 1952, library circulation across the country
totalled about 25 million items borrowed. By 1974 it was more than 100
million. By 1993 it was around 200 million items, though some of the
circulation was video and audio tapes. Library circulation has managed
to grow about 4 per cent a year over the past forty years.
MUSIC
Everywhere you care to look, classical music is losing
its audience. While the Three Tenors will soon earn a million and a half
U.S. dollars a night each in Vancouver and Toronto, such events are
unusual. London's Royal Festival Hall and the Barbican play on average
to half capacity and tickets for the Salzburg Festival or Amsterdam's
Concertgebouw are readily available after being sold out for
generations. The manager of one of America's top orchestras estimates
that within the next ten years an industry of over 250 professional
orchestras will shrink to barely a dozen. In Britain, it is predicted
that only six of its 14 symphony orchestras will last the century.
NEWSPAPERS
Canadians continue to buy fewer newspapers with the
industry reporting a 2.2 per cent drop in circulation in 1996. The
Canadian Newspaper Association, representing the country's 106 daily
papers, says circulation has been hurt by rising single-copy and
subscription prices as well as publishers intentionally reducing the
area in which they deliver their papers. Canadian papers sold an average
of 5.2 million copies a day in 1996: it was 5.3 million in 1995. The
decline marks six consecutive years of lower circulation.
COMPARATIVE PRICES
Prices for electronic products have fallen considerably over time. Here is a sample.
Cell phones:
1985 $2,500
1996 $200
Microwave Ovens
1972 $1,000
1996 $229
CD Player
1983 $800
1996 $199
VCR
1976 $1,000
1996 $239
Sony Walkman
1979 $230
1996 $89
Digital Watch
1976 $350
1996 $40
PREFABRICATED HOUSES
Canadian companies recently brought home $195 million in
contracts to supply prefabricated housing to the Japanese market. Canada
cornered 46 per cent of this market last year well ahead of the second
place United States with only 29 per cent. The houses are constructed in
sections, predominantly of four by four wood frames, insulated and
panelled and shipped out in containers with fixtures and fittings to be
erected on site. The market has been notoriously difficult for many
Western companies to penetrate. Japan has traditionally protected its
own producers with barriers to imports but government and industry are
now removing many of these barriers and imported goods are becoming
popular. There's even status to owning a Canadian home, which can be
supplied with furniture, carpets and drapes.
PRICE WAR
After operating a little-noticed but legalized price
cartel for many years, the world's ocean shipping lines have started
rebelling against one another dropping rates for the first time in a
decade. In the U.S. alone, this has already affected cargo fees on more
than $450 billion in consumer goods. Over the next three years, 650 new
vessels are expected to come on line and the rates are starting to
reflect supply and demand. Until now, many of the major shipping
companies have held rate conferences, sometimes weekly, to decide fee
schedules on thousands of consumer goods categories by weight and size.
The cartels control rates on as much as 60 per cent of the world's
containerized ocean cargo.
COMPETITION
According to a London Business School survey of 300
companies, too many facing competitive threat do little to defend
themselves until it is too late. It was found that the biggest
determinant of success was a rapid response with a targeted strategy.
The report points to significant market reversals that have occurred
when companies were overtaken by upstarts. Hertz Corp, for example, was
once the biggest car rental company in the U.S., but it has been
surpassed by Enterprise-Rent-A-Car. Rather than focusing on traditional
rentals at airports, Enterprise came into the market by working with
insurance companies to provide temporary replacement vehicles when a car
was stolen or damaged.
BAGS
Some U.S retailers stocked up on extra-large shopping
bags for Christmas in the hopes that people would buy gifts until they
were full. A New Jersey maker of plastic shopping bags states that sales
of big bags were up 11 per cent from last year.
STUDY
An Angus Reid poll shows the majority of working
Canadians are also students with business and computer courses at the
top of their popularity lists. Sixty-two per cent of employees
questioned said they had taken at least one adult education course in
the past year. Nearly a fifth reported three or more courses on top of
work. But only 57 per cent reported their employers were paying for
courses, usually for studies related to their current jobs. Eighteen per
cent said they were taking the courses to develop skills for a new
career. In all categories, women were more likely to be studying
than men.
COSTS
A survey of senior information technology managers shows
that most companies realize they spend too much on computer hardware and
software but few are doing anything about it. Thirty of 47 North
American executives interviewed said their company was highly committed
to "asset management"--jargon for cutting costs of computer
administration. Only seven executives said their organizations were
halfway through completing such a program and 18 said they had just
started. For companies, the stakes are high: a single desktop computer
can cost more than $38,000 (U.S.) over five years after maintenance
expenses and staff time are taken into account.
BIODIESEL
This is fuel for trucks and buses made from converted
restaurant grease. One potential disadvantage is that the vehicle seems
to be pulling away in a cloud of French fries.
RETAIL
A report by the Dominion Bond Rating Service Ltd.
suggests that profits will remain weak among retailers in Canada until a
shakedown shrinks their numbers. The combination of steeper
competition--including the flood of U.S. retailers in past years--and
sluggish consumer spending has led to severe price discounting. As a
result, operating margins have dropped to "unsustainable low levels."
Among the challenges facing retailers, the DBRS report points to: too
many retailers in similar formats, like clothing: high consumer debt
levels: competition from giant U.S. retailers, such as Home Depot and
Wal-Mart: distribution inefficiencies and poor customer service.
DIET
Canadians have included more fruit, vegetables and fish
in their diet over the past two decades, likely the result of concerns
over health and lifestyle and demand for various ethnic foods. In 1995,
each Canadian ate an average of 128 kilograms of fruit, mostly fresh,
compared with 97 kilograms in 1975. Per capita consumption of apples,
Canada's major fruit crop, was 14 kilograms in 1995 compared with 12
kilograms two decades earlier. Consumers have also been turning to
alternate tropical fruit such as kiwi, guavas, mangoes and papayas.
Vegetable consumption has increased to 172 kilograms compared to 150
kilograms twenty years ago. Consumption of fish is now eight kilograms
per person, mainly due to the demand for alternate sources of
low-fat protein and the diet preferences of a growing Asian population.
EDUCATION
Full-time university enrolment increased in 1996 reaching
a new record. Last fall, 576,900 full-time students enroled at Canadian
universities. Undergraduate students rose to 501,300 while there were
75,600 full-time graduate students. Part-time enrolment fell for the
fourth straight year. In 1996, part-time registrations dropped 8 per
cent to 251,300. The population base from which most university students
are drawn, the 18 to 24 age group, has decreased after peaking in the
early 1980s.
HARDWARE MANUFACTURERS
Canada's information technology sector recorded total
gross output of almost $64 billion in 1995, a 65.4% increase from 1990.
Growth was concentrated most heavily in software and services, whose
revenues expanded by 114%, compared with an 84% increase for hardware
manufacturers. Shipments by the computer and business equipment industry
were the fastest growing industry segment, rising 146.0% to $7.9
billion. In contrast to the growth in output, employment in the
information technology sector has weakened. It peaked at about 316,500
in 1990, but due to the recession and corporate downsizing, fell to a
low of 295,000 in 1994. Employment recovered somewhat in 1995, rising
4.7% to 308,800.
VOICE-MAIL
Some of them don't like certain voices. To a voice-mail
system, some voices sound like the tones made by pushing buttons on the
keypad, usually the pound key. The system assumes it has been given a
command and moves on to the next step, cutting off or erasing the
message. It's not just whiny, high-pitched voices that can be a problem.
Weak ones may not generate enough force to be heard. The system assumes
there's no input and ends the session.
HONOUR
Last year, Barbara Bush was named "First Lady of the Century" by Outlaw Biker magazine.
TRAVEL ADVISORY
A newspaper in Calcutta has offered these survival tips
when encountering a wandering elephant. Never stand in its path and,
whatever you do, avoid eye contact.
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