International Growth & Trade

As a leading nation in international trade, Canada’s companies and products are known throughout most of the global markets. Canadian exports and imports account for about two-thirds of the country’s GDP.

Selling Canadian Products into Foreign Markets

If you are considering selling your company’s products into other global markets, the first thing to consider is the internal organizational challenges that are associated with this process. They typically include:

• increased costs
• additional time and project management required
• more organizational processes (i.e., customer service, export documentation)
• international invoicing and insurance on non-payment

With the internal organizational challenges of moving into global markets, you should then evaluate the business factors required to successfully move forward. The following steps can help you evaluate and plan for expansion into international markets. JEDI can further assist with planning, market evaluation and relevant partners.

Step 1: Assessing Your Company’s Readiness

This includes:

• ensuring your operations/manufacturing can support unexpected and excess capacity, and to what level
• what the sales channels are (i.e., direct, distribution, local partner) and how you can operate within them
• what protection is available for technology and intellectual property (IP) rights
• being informed of the political and economic environment of the market
• what cultural challenges or adjustments may be required to enter the market
• understanding the legal and regulatory requirements

Step 2: Assessing Your Product Readiness

This includes:

• required market or quality standards
• any relevant environmental standards that may be applicable
• product modification or labeling requirements
• any transportation and shipping limitations of the product (i.e., perishable, fragile)

Step 3: Assessing the Market

This includes:

• who the competition is in that market and what market share is available
• whether direct sales channels can be used or a distributor (agent) is required
• identifying any free trade agreements that can assist in removing barriers
• understanding any significant culture differences

Step 4: Creating an Action Plan

This includes:

• making a business plan
• identifying the risk factors
• designing a market entry and pricing strategy
• implementing business plan and market strategy

For an in-depth look at exporting to global markets, the Canadian Trade Commissioner Service has a “Step-by-Step Guide to Exporting.” It is an excellent source for all the technical, business, assessment and resource tools commonly used in the exporting environment. To access this guide, click here.

Opening a Canadian Business/Subsidiary in a Foreign Market

Opening a business or a subsidiary/branch in a foreign market carries many of the same business considerations as selling your product in that market, but it specifically shifts the focus to a company’s operational, financial and ownership obligations. JEDI can further assist with planning and establishing the best target markets. While commerce and legal regulations will vary in each market, the following key factors should be considered and evaluated when opening a business in a foreign market:

• tax implications in the country
• what type of business organization can be created, the legal liabilities and what exposure there is to the Canadian operations
• the country’s legal structure
• industry-based permits and certifications that may be required
• employment law and labour considerations
• foreign ownership regulations and limitations