7 Things to Know About Warehousing in Canada
More foreign companies have entered the Canadian market in recent years, offering products Canadians can buy that they couldn’t physically purchase in Canada. For distributors and sellers in the U.S., the question is, “Can we ship products to Canada from the U.S. or do we have to set up shop there?” Both options come with a lot of implications.
Since the recent downturn, the Canadian consumer’s demand for all products has outpaced that of the US and other countries. As a result of weak US earnings, wholesalers and retailers increasingly looked towards Canadian business development. If you are considering whether or not to work in the Canadian market, here are 7 things about warehousing in Canada that you should think about.
The benefits of providing goods to Canadians
Canada has few entry barriers, so even though it is comparatively smaller, Canada makes sense for US companies looking for earnings growth. Both countries share a land border, speak the same language, have a free trade agreement in place and value each other as huge trading partners. As a result, trade is welcomed.
Nevertheless, doing business abroad has costs and factors so make sure you consider the following questions; What is the benefit of US companies marketing cross-border on an order-by-order basis? Can you easily create relationships with Canadian vendors and supply outlets in Canada via wholesale sales from the United States? Can you develop a Canadian warehouse and supply chain? Would you set up a retail/wholesale business (like Target, Marshalls, and Walmart before them)?
Make sure you have answers to these questions before starting to enter the Canadian market.
Warehousing and 3PL solutions in Canada
Small and large US businesses can benefit from establishing warehousing, distribution, and fulfillment in Canada. Distribution and logistics firms are often integrated with warehousing and distribution operations. Moreover, these warehousing companies specialize in accepting warehousing and order fulfillment functions for remote US customers who have established a sales network in Canada.
Accessing the Canadian market with your products from the US might be easier than you think. Aside from Canadian customs and taxes implications, the mechanics are rather straightforward aside from the cross-border brokerage/duties details to work out.
Storing: 3PL provider stocks and stores inventory
The shipment arrives at the 3PL warehouse. The warehouse specialist processes the load. The manager accounts for every item in the shipment, who confirms that the receipt you submitted matches the shipment you sent.
Warehouse specialists stock and store your inventory after the shipment has been processed until it sells out or you decide to remove it.
When your products are stocked, you’ll receive a notification, and you can then start selling them.
Capabilities of 3PL warehouse fulfillment
As Canadian outlets or customers demand your product, you’ll need it prepared and stored. This means that the warehouse will send the goods to your Canadian merchants as required by slide load. Maybe you are taking online or email orders from Canadian customers when you don’t yet have retail partners. Warehouses should be able to pick, package, and ship directly to customers.
Often, these warehousing partners have a complete understanding of “drop shipping.” In short, they send orders directly to customers “from” you on your behalf. In essence, you are contracting them as your warehouse. A logistics and warehousing partner will also be able to offer you great rates on transportation, be it courier discounts or cargo rates.
Flexibility in warehouse space equals flexibility in pricing
As a result, setting up operations in Canada doesn’t require a huge investment. A warehouse partner should allow you to grow as your business develops and to adapt your space needs based on seasonal and overall changes. They often charge based on how much distance you are using during any particular charging cycle, not on how much square footage you are using. Also, you’re billed based on the number of orders you fulfill.
Real sales and warehouse space requirements are more closely aligned with costs. If you hold more stock and earn more, you will pay more – and inversely. The move makes good business sense for US companies partnering with a third-party Canadian warehouse and reduces risks.
Warehouse location of your 3PL in Canada
Last but not least, consider your Canadian warehouse and supply place. Thirty-five million people make up Canada – potential clients. It might be advisable to target markets with the densest populations. Canada’s most populous region is the Greater Toronto Area, surrounded by Lake Ontario within the “Golden Horseshoe.”
Nearly 26 percent of Canada’s population lives in this region, home to 9 million people. The size of this market rivals any large one in the US. Burlington, Ontario, is located nearly in the middle of the Golden Horseshoe. It is an excellent place to locate your Canadian fulfillment operations through warehousing and distribution. Located in southwest Ontario, it is close to all major highways and minutes from Toronto Pearson Airport.
A US company looking to establish a Canadian presence for business reasons has a lot to consider and may discover that partnering with a 3PL and warehousing company in the Greater Toronto Area can set them on a fast path to gaining a lucrative Canadian client.
Multiple location warehousing
Where are the people you want to reach? Is Canada your main market? Are you only targeting Europe? Is your audience spread out all over the world?
Another benefit of having a 3PL warehouse fulfillment center in your customer’s country is no customs fees.
- ShipBob and ShipMonk, for example, only have warehouses in the United States.
- Amazon’s fulfillment programs, Fulfillment by Amazon (FBA) and Amazon Web Services (AWS), also have warehouse fulfillment centers in the US only.
- Huboo has a warehouse in the UK for its 3PL operations in Europe.
Choose a logistics company that has warehousing located close to your customers. Your shipping costs will be cheaper and faster if your products are closer to your customers!
Wills Transfer is highly recommended for warehousing Canada. Our trusted team has over 75+ years of experience in the business.
For more information about how we can help improve your business Logistics, call us at 1-613-704-7549 or contact us here.