Exporting to Canada from The US: How to get started?!
The US and Canada have a very prolific relation when it comes to trade. According to the data from 2018, Canada was the largest export market for the US, amounting to 18% of the total exports. In 2020, Canada remains at the top of the list for US exports. In the month of August 2020 alone, the US exported goods of value $22827.85 million to Canada.
The exports to Canada mostly comprise of vehicles, machinery, mineral fuels, etc. So there is no doubt that Canada presents itself as a great place to export goods and grow your business. However, you cannot just start shipping products. There is a clearly defined process for exporting goods from a country to another. In this guide, we will help you in understanding the specifics of exporting from the US to Canada.
Understand the new changes by USMCA
Countries trade within the bounds of a trade agreement. When we consider the US and Canada, the trade between these two counties were per the regulations of NAFTA (The North American Free Trade Agreement) until it was replaced by USMCA (United States-Mexico-Canada Agreement) on July 1, 2020.
- Modernizes trade rules by incorporating regulations pertaining to digital goods and services
- Brought in new measures to counter piracy
- Set minimum protection of 15 years for industrial designs
- New penalties and criminal procedure for illegally camcording movies
- Increased De Minimis Shipment Value Level
- More access for US dairy farms in Canadian markets
These are just a few key points. You must refer to the new changes in relation to your industry and make moves accordingly.
1. Do your market research
The success of any product will depend on demand. When there is a demand for a product and you can supply successfully, then the product will sell.
One common mistake new exporters make when exporting to Canada is that they are trying to sell a product that is not required in the Canadian market. So market research should be high on your list before you get into exports.
Nowadays, they are multiple ways in which you can study the market distribution of a country. Use insights from reputable sources to ensure that you are selling to a market that has demand for your product. With some careful planning, you will find Canada a great place to do and grow your business.
2. Build solid connections
If you are stuck on finding what all Canada imports to its soil, then the government has made it easy for you with the Canada Importers Database. This is a great place to start as you can get an idea about what different companies are already supplying to Canada.
Now you can devise strategies for your products, and meet with the right people who can help you do business.
It is important that you find the right people to do business with. It can be a very daunting experience if you go at it alone. Build connections with people who can help you in different aspects of your business, Ensure that you return the courtesy whenever possible.
3. Understand the laws of Canada
When you are exporting goods to a country, you need to learn about the rules and regulations that govern the country.
We do understand that this requires a fair share of research, and will eat down on your time. However, you can connect with the U.S. Commercial Service Offices or Trade Missions to know more about Canada and how you can get started.
4. Get all the documentation right
There are customs procedures that you need to follow in order to export to Canada. At the border, the customs authorities will scrutinize your shipments.
To get a green light, you will require all the necessary documents. The first and foremost among those lists of documents is the Canada Customs Invoice or its equivalent when you transport any commercial goods to Canada. Form B3 is also submitted at the border.
The number and nature of documents changes based on the goods you are trying to export. For example, certain specific laws apply to goods like milk or grain. If you are not familiar with the process, it is best to let a customs house broker handle it for you.
5. Hire a reliable customs house brokers
The new laws and regulations in the trade have made it easier for exporters in the US to sell their goods in other countries. However, the paperwork and legwork are still there.
When you are setting up your business, taking the time out to fill in the export forms and learning how everything works can be counterintuitive. What you really want to do here is outsource all the paperwork and legwork of customs to a reliable customhouse broker.
Customs house brokers are individuals or services who help exporters and importers in gaining customers clearance.
How we can help
Pedraza Customhouse Brokers have been in the field of export and import for over 15 years. We have helped countless clients in setting up their businesses around trade and provide a comprehensive service from the pickup to delivery.
We understand that the laws and paperwork regarding trade can be confusing, and often deters away entrepreneurs. However, we streamline the process so that our clients can concentrate on building their business, and we will take care of the rest.