If you were contemplating how to expand your business in 2020, you may have had to put your ambitions on the back burner for the moment. That doesn’t mean you need to give up on them necessarily.
In fact, you can use the slowdown as a chance to create better plans for expansion, which you can implement over time. When the right expansion opportunity arrives, you’ll be ready to jump on it.
This guide walks you through the steps to plan and execute a successful expansion into Canada.
Conduct Market Research
The first step to successfully expanding to any country, including Canada, is to do some market research. Discover what services or products are already offered. Look for gaps in the market, and ask how your business would be able to fill them.
In the wake of the pandemic, there’s likely to be some openings. Small businesses may have had to close their doors, leaving would-be customers without products or services. The challenging conditions of the pandemic may have demonstrated a need for a certain service or product, which you can then fulfill.
Your market research will have to consider legalities as well. An existing gap could mean the market is currently underserved, or it could mean that laws have excluded the type of product or services you offer. In this case, you’ll need to dig a bit deeper, then think about how you can adapt your business for the Canadian market.
Consumer attitudes are also important. A gap in the market might mean that there’s little to no demand. It may be possible for you to create this demand, but your business could face more challenges.
Think about Legal Structure
Once you’ve conducted your market research and determined there’s an opportunity for your business in Canada, it’s time to think about setting up shop.
The question for most business owners is what kind of business they’ll set up north of the 49th. You have a few options, including a subsidiary or a branch office.
Each business structure comes with its own advantages and disadvantages. These can include certain restrictions, such as board of director requirements for subsidiaries. In Canada, subsidiary companies must have so many Canadians sitting on the board of directors.
Business structure also plays a key role in determining your tax obligations. A Canadian branch has much different tax rules to follow than a subsidiary.
You’ll want to decide which is the most efficient for your business. In some cases, a branch may be the better choice than a subsidiary. In other cases, the subsidiary may insulate your home branch from expected losses.
If you’re not sure which is most efficient for your business, then it’s time to consult with the experts. You may want to talk to business lawyers, accountants, and even a professional employer organization. Their insights can help you see the right path forward.
Pick Your Province(s)
Now it’s time to determine where you’ll set up your business operations in Canada. Choosing a province to operate in often goes hand in hand with deciding on your legal structure. Some provinces offer unique ways of structuring your business, which can affect your decision about where to set up your base.
Once you’ve selected the province you’ll operate in, it’s time to familiarize yourself with the laws. These may include health and safety rules or laws about reporting. Many laws dealing with finance and advertising are federal in nature, so you’ll only need to learn one set.
By contrast, payroll and employment laws often have both a federal and provincial component. You may need to make deductions for the Canadian Pension Plan and Employment Insurance, but the rates will differ by province. You’ll also need to determine which holidays are considered statutory and the rules around vacation.
The provinces may also have different rules on the books around health and safety in the workplace, or even about how many hours someone can work. You’ll want to be sure to keep up with minimum wage laws, pay transparency rules, and even paid and unpaid leaves. Compliance is a big job, and it becomes even more important when you’re not familiar with the rules.
To help, you can team up with a PEO. The experts on their team know the ins and outs of Canadian law already, so they can get you started with policies for your first hires and assist you with payroll. They may also be able to help with setting up benefits or accessing workers’ compensation insurance.
Communication Is Key
You’ll want to put some thought into operations and particularly communication. You’ll likely need to set up logistics and supply chains, which can be challenging in a country as big as Canada. Canadian vendors might offer what you need, or you may have to import from elsewhere.
Whether you’re working with a vendor or discussing policies with an employee, communication is a vital part of your business strategy. Consider how you’ll communicate with your Canadian team members, especially if they’re working remotely.
You’ll also want to think about reporting. How often will you check in with the Canadian branch? How will they report to you?
Communication often cultivates a better working environment, as well as improved relationships with employees and vendors. Consider cultural differences in how you communicate as well.
Communicating with Customers
Finally, you’ll need to communicate effectively with your customers. Your brand messaging could require adaptation, as well as advertising materials. Will that marketing campaign resonate with a Canadian audience?
Taking time to consider these factors now will help you create more successful campaigns and build better relationships with your Canadian clientele.
Plan for Success
The world may have hit “pause” for the moment, but that doesn’t mean you’ll never expand your business. Take the time to invest extra thought and effort into your expansion plan. Consider the factors outlined in this guide, and you’ll be ready to expand when the time is right.