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Success In Quebec

Date:December 9, 2013

With the US-Canada trade reaching more than $1 billion US per day, the Canadian market is not one that should be overlooked. The proximity, some cultural commonality and the free-trade relationship are all things that make it easy to do business in Canada. For US companies it has never been easier to adapt their products to the Canadian and Québec markets, e.g.  on-line translation services can help with market entry. Using translation experts ensures that your customers, whether English or in French, get the same uniform message that you wish to portray of your company and the quality of its products. Canada has a population of over 32 million people, of which over 6 million live in the province of Québec (2nd largest province in Canada). More than 70% of the Canadian & Québec population lives within 100 kms/60 miles of the Canada-USA border. 

U.S. companies looking to grow their international portfolios need to consider the tremendous business opportunities offered in Canada. A solid and integrated supply chain between the two countries and new developments in I.T., computers, consumer goods, shipbuilding, air-defence, safety and security, mining, and renewable energy, create virtually limitless business opportunities in Canada & specifically in the Province of Québec. Nevertheless, the business landscape is constantly changing and the U.S. and Canadian Governments, through the Beyond the Border Initiative, are committed to safely increasing the flow of people and goods across the border while maintaining the security and integrity at the border. By removing additional barriers to trade, the border and regulatory cooperation initiatives will make United States and Canadian supply chains more efficient and more integrated. Governments are working to reduce outdated and unnecessary regulations through the U.S.-Canada Regulatory Cooperation Council and enhanced IPR protection to support increased trade and investment.

Canada continues to hold a historic record as the United States’ largest export market, accounting for 20 percent of total U.S. trade. Total stock of Canadian foreign direct investment in the United States also ranked among the top four in the world.

Market Challenges

Though Canada remains the most accessible market in the world, doing business in Canada, and specifically in the Province of Québec is not the same as doing business in the United States. Canadian Customs documentation, bilingual labelling, packaging requirements, ITAR (International Traffic in Arms Regulations), and Canadian federal and provincial sales tax accounting can be challenging.

Canadian federal, provincial, and municipal procurement procedures, while open in principle to U.S. bidders, can vary from procedures followed in the United States. Bidders must be registered in Canada in order to bid, and bidders must fulfill all the requirements in order to qualify to bid (specified requirements are non-negotiable). In some cases, security clearances are required for personnel prior to submitting a bid, and in a number of projects, there may be requirements for off-sets (known as Industrial Regional Benefits or IRBs).


Market Entry Strategies

For many companies, frequent visits and establishing a local presence will be crucial to long-term market success. Because of Canada’s proximity and cultural similarity to the United States, many U.S. companies incorporate their selling efforts in Canada into a general North American division or strategy. This time-tested approach usually works well. For companies new to the market, a distributor-based approach, Internet marketing, direct sales strategy, or a combination of the above can be an effective market entry or expansion strategy.

Although U.S. firms have experienced success in marketing directly to Canadian companies, in general, odds of success are multiplied if companies work through a Canadian/Quebec partner or local agent. A robust Canadian bilingual website is also recommended. For U.S. companies wanting to optimize their marketing budgets and staff, we at 4Growth can help & advise you in discussing, reviewing & planning for the following key strategic considerations for the Québec & Canadian markets:

-             Using an Agent or Distributor

-             Acquisition

-             Locating Partners and Customers

-             Establishing an Office

-             Franchising

-             Direct Marketing

-             Joint Ventures/Licensing

-             Distribution and Sales Channels

-             Selling Factors/Techniques

-             Electronic Commerce

-             Trade Promotion and Advertising

-             Internet marketing

-             Pricing

-             Sales Service/Customer Support

-             Protecting Your Intellectual Property

-             Due Diligence

Although Canadian businesses have a strong reputation for business ethics, before signing a major contract or entering into a long-term partnership agreement, U.S. exporters should conduct adequate due diligence.

In summary, given the nearly $1 trillion in bilateral investment and trade annually between Canada and the United States, geographic proximity, and the similarity in business cultures, we strongly believe that Canada offers excellent business opportunities for U.S. firms.

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Date:December 9, 2013