how small business owners in ontario can expand this year
By Connor A. Schroder – Dec 17, 2025 at 8:11PM EST
Chairman & Managing Partner
Old York Financial
practical, high-ROI moves you can make now. (margin, pricing power and capital allocation.)
Many small businesses waste an entire year doing “busy work” while real profit sits idle. The fastest way to materially increase earnings in 12 months isn’t a gimmick, it’s a sequence: raise prices where you can, stop losing money on bad customers or products, automate low-value work, and capture government support that funds growth. Below are clear, investor-minded steps any Ontario owner can start this week.
1) focus on pricing power and margin
If you can raise price without losing the customer’s respect, do it. Small percentage increases compound quickly. a 5–10% price raise on under-priced offerings often increases net profit far more than tiny cost cuts.
Actions:
Identify your top 30% most profitable customers/products. Protect them; price them for value.
Test a 5–10% price increase on a low-resistance SKU or service and measure churn for 30 days.
Move away from hourly/time pricing toward value or outcome-based pricing on services (less commoditized, higher margins).
KPIs: gross margin %, average transaction value, churn rate.
2) kill loss-making lines and stop selling to the wrong customer
Most owners keep legacy offerings because “they sell.” If a product or client consumes more time than dollars, cut it.
Actions:
Create a simple profitability scorecard per product/customer (revenue minus direct cost minus attributable hours).
Eliminate or reprice the bottom 20% that drags overall returns.
Introduce minimum purchase terms or retainers for clients that cause cash-flow headaches.
KPIs: EBITDA per client, % revenue from top 20% customers.
3) turn one-off buyers into recurring revenue
Recurring is predictable and more valuable. Even a small subscription or maintenance plan stabilizes cash.
Ideas:
Convert warranties, repeat services or replenishment products into subscriptions or annual plans.
Offer a premium membership with priority service, bundled discounts, or exclusive inventory.
Sell product refills, consumables or service check-ups on automatic schedules.
KPIs: % revenue recurring, customer lifetime value (LTV), churn.
4) automate & outsource low-value tasks
Reduce payroll drag and opportunity cost. Free the owner (or your best employee) to generate revenue.
Actions:
Automate invoicing, reminders, recurring billing and inventory alerts.
Outsource bookkeeping, payroll and basic customer support to specialists or virtual assistants.
Use a single ops checklist (SOP) for repeat tasks so you can delegate safely.
KPIs: hours saved per week, billing cycle time, error rate.
5) cash flow & tax housekeeping that frees capital
small moves in accounting free cash you can deploy for growth.
Actions:
Register and collect HST correctly (Ontario HST is 13%) and recover input tax credits, that improves net cost on capital buys.
Manage payables and receivables aggressively: introduce shorter invoice terms, early-pay discounts, and late fees where appropriate.
Work with your advisor to choose salary vs. dividends (if incorporated) and to ensure you’re using the small-business deduction where appropriate Ontario’s small-business tax calculations support a low provincial rate for eligible CCPC income. Canada+1
KPIs: days sales outstanding (DSO), working capital ratio, effective tax rate.
6.) invest where returns are measurable (your personal ROIC)
Treat every dollar like a partner’s capital. Ask: will this $1 spent return $2+ within 12 months?
High-ROIC investments for small business:
Staff training that increases productivity or average ticket.
A conversion-focused website and paid digital campaign with clear CPL/CAC targets (use microgrants where possible).
Inventory optimization (turns up, carrying cost down).
A high-margin product line extension or service upsell.
KPIs: payback period on acquisition, new customer CAC to LTV ratio, margin on new lines.
what to avoid
Never race to be the cheapest unless you control cost structure perfectly. price wars kill return on invested capital.
Don’t chase every new grant or tax credit; focus on ones that line up with concrete investments you would make anyway.
Avoid heavy capital purchases unless the expected return is clear and measured.
think like an allocator
Treat your business as the single most important investment you control. Protect pricing power, get rid of low-return activity, and use grants/tax credits to de-risk investments in digital tools and training. Do those things and your operating earnings will move materially, often within months rather than years.
want help increasing earnings, without guessing?
Old York Financial works with a small number of Ontario business owners to improve profitability, pricing power, and capital allocation. Our work is practical and measurable: higher margins, cleaner cash flow, and decisions made with an owner’s mindset.
If you’re serious about earning more this year, not just being busier.. we invite you to start with a short conversation.
