Four in 10 using AI to strengthen domestic supply, dynamic pricing strategies
Canadian firms are banking on artificial intelligence (AI) to boost efficiency while they try to manage tariff‑driven cost pressures, according to a recent report.
Currently, 23% of companies are using AI while 42% are evaluating it. Companies see AI as a tool for resilience (pricing, supply chains, market expansion), not just hype, found the Zoho Canada Business Outlook.
Practical use cases are already widespread. Zoho reports that 45.9% of respondents are using or exploring AI to support entry into new markets, 41% to strengthen domestic supply chains and 39.3% for dynamic pricing strategies.
Innovation outranks flexible work
Automation and innovation rank as the top two technology priorities, ahead of areas such as flexible work, which now “ranks fifth and is no longer one of the main priorities.”
“There is a strategic shift underway among Canadian businesses,” says Chandrashekar LSP, Managing Director, Zoho Canada.
“They aren’t waiting for economic conditions to stabilize—they’re proactively redesigning their operations. The move toward AI and automation is about building resilience, improving margins, and protecting customer experience in an environment where costs are rising and predictability is hard to come by.”
He added that “that level of adaptability is why optimism remains strong going into 2026.”
Nearly all large organizations now use AI, according to previous reports.
How is AI being used in business operations?
Case studies included in the Zoho report highlight how embedded AI has become. “We're not treating AI as a future initiative—it's core to how we're managing volatility today,” said Phil Edey, Business Analyst at Arctic Spas.
He cited applications such as automating dealer workflows and CRM processes, and using AI for competitive intelligence and customer service.
“The tariff situation has forced us to think differently about efficiency, but that's why we're optimistic heading into 2026: we're not waiting for stability, we're building it. The ROI isn't theoretical—it's measured in hours saved and better decisions.”
At CIMCO Toromont, AI is being used to unlock value from years of accumulated data.
“Since partnering with Zoho in 2009, we’ve accumulated thousands of data points. Now, with advanced machine learning and AI technologies, those data points will become actionable insights—empowering our sales team to make smarter decisions and provide exceptional service,” said Vice-President of Sales David Fauser.
While the integration of AI into the workplace is accelerating, Canadian employers are well aware that technology must not come at the expense of the human element, according to a recent report. Overall, 80% of Canadian business leaders agree that “keeping a human in the loop is important when using AI,” according to a previous ADP report.
Majority of employers remain optimistic
Against this backdrop of intensifying AI use, Zoho’s survey of 1,000 individuals shows that businesses remain broadly resilient but under pressure. The report notes that 60.8% of respondents say their business grew in the past six months, and 62.1% are optimistic about 2026.
Staffing is largely stable: 44.1% of firms are hiring and 47.5% anticipate no change, with layoff plans at 11.2%.
At the same time, leaders are prioritising efficiency and customer experience over workforce development. Zoho finds that operational efficiency and customer experience rank as the first and second business priorities, respectively. Talent and HR rank last at fifth.
Tariffs and cost increases are a key driver of this behaviour. According to Zoho, 66% of respondents cite tariff‑driven cost increases as their “top pain point”, driving pricing changes, supply chain shifts and risk mitigation.
Still, “staff reductions remain a last resort,” according to the report.
When asked how governments could help, respondents ranked “reducing internal‑provincial trade barriers as the number one way that governments can support businesses impacted by tariffs,” followed by diversifying international trading partners and boosting research and development funding.
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