What you need to know when selling online in Canada (Complete Guide 2021) | Everything Shop

The world of ecommerce is ever growing, and selling online can sometimes be quite intimidating for inexperienced business owners. Whether you are just launching a new startup, or have decided to expand your horizons and step foot into the ecommerce universe for the first time, there are many risks involved, long lists of tasks to finish and a great many questions that need answering. 

The prospect of selling online in Canada can sound overwhelming, but you needn’t worry! In this article, we present to you the ultimate guide to the Canadian ecommerce scene. From step-by-step breakdowns of the process to obtaining licenses, paying taxes and learning helpful tricks and tips – here is all you need to know, and more!   

Canada’s International Ecommerce Sales Potential

“Your margin is my opportunity.” - Jeff Bezos

Canada’s international ecommerce scene has shown great turnouts and potential in recent years and is expected to only grow bigger and better with time. Selling online in Canada is a smart business choice for many international ecommerce merchants. Being a large and active consumer market, most business owners take advantage of this growing online market and are happy with their sales figures. 

“Canada believes that electronic commerce provides new ways of doing business, opens new business opportunities and that it is still commerce rather than a new sector. Canada considers that existing multilateral agreements and frameworks already apply to electronic commerce.”[1]




Selling Online In Canada- Where to Begin?

When stepping foot in a high-pressured and competitive market, it is essential to understand exactly how the procedure works - what you need to know, what to do and what to avoid. Below is a comprehensive guide to ecommerce facts and selling online in Canada. 

Products that Pay the Bills 

Alongside picking out a good online selling platform, it is vital to understand your target market. In Canada, some of the best online selling products usually fall into these categories: outings, restaurants, shows, video games, music, jewellery, accessories, clothing, electronics and mobile apps. If the products you sell fall within these ranges, you have a greater chance of establishing your presence in the Canadian marketplace, ensuring that you build a strong customer base and can boast of a successful business journey. 

Commonly-used Payment Methods 

The checkout page is the most essential, and also the most sensitive part of any online buying platform. It is extremely important that you optimise your checkout options for all customers, both local and international, as this is bound to play a vital role in your business’ conversion rate. When selling your products online in Canada, make sure that you provide currency conversion options, local payment methods and efficient and timely shipping services. 

Credit/debit cards, cash on delivery and contactless cards are the most frequently-used online payment methods in Canada. It is important to offer your potential customers these preferred, tried-and-tested and reliable payment methods. Not offering these popular payment methods will result in you losing a large number of customers in your given market, as most online shoppers tend to cancel their loaded shopping carts if they aren’t offered their trusted methods of payment.

The Mobiles are Taking Over

Mobile ecommerce now makes up a large portion of Canada’s ecommerce marketplace, and mobile usage is expected to surpass desktop usage in Canada in the upcoming years. This is especially true for B2C online purchases but is worth keeping in mind for all ecommerce merchants. When setting up your online store and product listings, you should ensure that your website/ store is offering full mobile optimisation, thus guaranteeing a seamless mobile buying experience. This must be a focal point of your ecommerce strategy as it is bound to have a significant impact on your business turnouts. 

How to Ship the Goodies Home

The Canadian ecommerce industry can sometimes be quite cut-throat. When trying to make your way through this competitive market game, it is important to ensure that you offer cost-effective, timely, reliable and efficient shipping services. One way of knocking your competition out of the park and ensuring that your brand remains at the top is by providing your customers with the most trusted and secure local shipping services. If you are new to this game, your safest bet is opting for an international parcel forwarding service, which is easy to use and also light on the pocket. 

Taxes: Get Your Numbers Ready

Before advertising or displaying your products on any platforms, whip your calculator out! Calculating and showing all local taxes and duties on your site is one of the most important to-do tasks for any new ecommerce merchant in Canada. You will need to assign the relevant HS codes to all products on your website, and then apply those to figure out what taxes and other duties will be applicable to the products you are selling. This can be quite a migraine-inducing task to do manually, so we advise against undertaking this on your own. You can, however, make use of Glopal’s HS Classification tool to quickly get the job done for you. 

Other Things to Keep in Mind 

Apart from the basics we have already discussed, these are some additional things to go over when selling online in Canada. 

  • Keep the law first. Make sure to thoroughly read up on and understand what local laws apply to your products and services, and if you comply with them. 
  • Localise your consumer agreements, and ensure that they follow all Canadian laws and contracting practices. 
  • Review your website and sales processes, checking that you have made all necessary disclosures and that your site aligns with all design accessibility requirements. 
  • Offering certain services in Canada may lead you to face additional requirements, for example, gym memberships or local dating services, so do your research and determine if these apply to you and your business. 
  • Make sure you are following all provincial internet sales laws; not complying with any of these terms of sale can lead your customers to cancel their contract, and you may also have to face law enforcement. 

Do You Need a Business License to Sell Online in Canada?

Yes you need a business license to sell online in Canada. All companies and brands require a business license when selling online. This is important as it enables the government to keep a track of tax revenues and add your business to the list of enterprises operating in that area. Make sure that you complete the required paperwork and renew your licenses annually. Not doing so may subject you to heavy fines, and you may also be forced to cease operations till all requirements are met. 

Is Reselling Illegal in Canada?

No reselling is not illegal in Canada. You have the ability to resell almost anything that you have purchased, as manufacturers have no control over their items once they have been bought. However, there are some products banned under the Canada Consumer Product Safety Act, as they are categorised as dangerous. Reselling such products may result in legal charges against you. 

Where Can I Sell Things Online in Canada?

There are a number of online maretplaces to sell online in Canada. These websites include: eBay, Everything E-shop, Walmart and Amazon are some of the best online selling platforms in Canada. Others establishing themselves in the game are Apple, Canadian Tire, The Home Depot, Costco, Alibaba and more. Promoting your products on any one of these top sites is a good business decision, but it is also important to figure out which one of these popular platforms best suits your particular business needs, profile and outlook. Make sure to thoroughly understand which site is most ideal for your product in terms of competition, traffic volume and the type of customer base it attracts, before choosing it as your domain. 

How Do I Start an Online Store in Canada?

The best way to start an online store in Canada can be followed by the below checklist. Most of the basics of the Canadian digital start-up process have been summarised above, but this checklist is a simple, general overview of some of the necessary steps:

  • Choose a niche, and give it a name! Your business name should be unique, catchy, and informative. 
  • Determine your Unique Selling Proposition. Simply put, figure out what your business is offering and why it sets you apart from others.
  • Define your target market, and choose a platform through which you can best reach them online. Register your business with a domain that is suitable for the Canadian market, and also aligns with your business ethos.
  • Find your product suppliers, unless you are manufacturing your products yourself.
  •  Make sure you have addressed all these necessary components of localisation: 
  • Local marketing 
  • Currency conversion 
  • Shipping options
  • Customs, taxes and duties 
  • Legal compliance and limitations
  • International payment options
  • Product restrictions
  • Mobile optimisation
  • Open a business bank account. It is best to keep it separate from a private one, as it makes it easier for you to track your income. 
  • Make an outline of your budget. Determine how much you’ll need to break even, and how much to earn a healthy profit. 
  • And finally, take a deep breath, and get ready to launch the business of your dreams!  






References

Electric Commerce (e-commerce). Global Affairs Canada.
https://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/other-autre/ecomm-comme.aspx?lang=eng
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