O Canada

Why it makes good sense to sell to the Great White North
Magazine Contributor
4 min read

This story appears in the March 2000 issue of Entrepreneur. Subscribe »

Seeking a wider market for your product or service? You don't have to look too far from home. "Any exporter should consider Canada a first stop," says Linda Archer, Toronto representative of the U.S. and Foreign Commercial Service in Canada.

Many do. Canada is the United States' largest trading partner, with $154.2 billion in 1998 exports and $175 billion in imports. No doubt these figures were boosted by NAFTA's phase-out of trade tariffs in 1998, eliminating customs duties for U.S. entrepreneurs exporting to Canada.

While similarities between the countries are a natural advantage, it's important not to overlook the differences. "If your product sells well in the U.S., [that's no guarantee] it'll sell well in Canada," says Archer. "You have to know whether Canadians import widgets or manufacture their own. And, if they do import widgets, are they from the U.S. or somewhere else?"

Another crucial step, says Archer, is determining "whether [your target market] even exists in Canada."

Fortunately, there's no shortage of information on Canadian businesses. The U.S. and Foreign Commercial Service in Canada works primarily with small and midsized businesses, helping them find contacts, attend trade shows, set up business meetings with prospective buyers, learn the culture and understand the regulations and paperwork involved in shipping products across the border.

Moira Allen is a freelance writer in Mountain View, California, and editor of Global Writers' Ink, an electronic newsletter for international writers.

Know Thy Neighbor

Where to start? Visit Canada yourself. You can also study Canadian media for popular products and marketing approaches or do research via the Internet.

According to Kathleen Keim, deputy director of the U.S. Department of Commerce Trade Information Center, some market insights should help you. For example:

  • Trends get to Canada a little later. If something's hot in the United States today, it may not be hot in Canada for another six months.
  • Because Canada is bilingual, most imported products must include information in English and French. If you have a Web site, offer a French (Quebecois) version and include a Canadian suffix (.ca) to emphasize your company's Canadian focus.
  • Canadians often have less disposable income than U.S. consumers, because taxes are higher. Consequently, Canadians are interested in products that offer exceptional quality at a good price.
  • Because Canada has a considerably smaller population than the United States (less than 30 million), Canadian retailers may be more selective about the products they carry.
  • Canada offers a burgeoning market for mail order and e-commerce, as Canadians purchase more products by mail per capita than U.S. consumers, and will spend $7.8 billion online annually by 2003, according to experts.
  • Canadians tend to dislike excessive promotion. Skip the hype and focus on facts, and avoid making negative comparisons between Canadian products and your own.

For more Canadian resources, go to https://www.entrepreneur.com/entrepreneur.hts, click on "Biz Smarts," and then click on "Global."

Northern Exposure

According to Adeel Zaidi, 41, the key to successful exporting is understanding Canada's business culture. Zaidi should know--he's founder and CEO of newly launched Vehicular Thermal Management, a project-based alliance between six companies in the United States and Mexico, and CEO of Karmazin Products Corp., which has exported heat exchange systems to Canada for more than 20 years.

What then is Canadian business culture? One thing it's not, according to Zaidi, is unified. He points to, rather, three distinct cultures in Canada--those who see themselves as North American, as British European and as French. Few think of themselves as "American" in the sense of sharing U.S. culture.

Each Canadian business tends to have its own corporate culture in addition to its national identity, so Zaidi recommends you personally visit your Canadian partners. "We ask them how we can help, what aspects of our products we can improve, and how our products are working for them," Zaidi says.

Canadian businesses demand high levels of customer service and economic knowledge, and aren't interested in hype. "You don't sell products by taking someone out to lunch and trying to impress them." Instead, he recommends putting together technical, as well as commercial, presentations. "Then you can go in and say, 'Look, our product is 15 percent cheaper, gives you 10 percent more performance and is environmentally friendly.' " Quality and price get you in the door, says Zaidi, but technical competence and innovation are what get the business.

Contact Source

Karmazin Products Corporation, http://www.karmazin.com, http://www.vtmllc.com

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