Shipping to Canada can be a headache, eh? (part deux)
In an earlier blog post, we talked about the challenges American companies face when shipping physical goods to our northern neighbor Canada. In addition to brokerage fees, lost shipments, lack of tracking abilities, blocked shipments due to VAT charges, returns being nightmares, and unpredictable delivery times, we’ve thought of a few other points to consider. Here are other common problems encountered by US companies when fulfilling orders to customers in Canada:
1. Time from order submission to product at your customer’s doorstep – No one wants to wait a month to receive their online order. Low order processing and shipping time means happier customers and puts your brand a step ahead of competitors. How do you do this? One way is to clear customs before orders are filled by storing goods across the border so they don’t encounter customs issues and ship faster.
2. Compliance requirements are ever-changing – Canada Border Services Agency (CSBA) is constantly changing their requirements. Make sure your shipments are up to code and don’t get rejected at the border – ensure you aren’t caught with your pants down by working with someone who has expertise in Canadian logistics.
3. Provincial differences – Canadian provinces are similar to US states in that each has their own set of laws in the context of commerce. Some collect a “harmonized tax” which consists of charges to both federal and provincial governments. Others simply require a “goods and services tax” where the funds go directly to the federal governance. If you’re not aware of these differences, here is a good article to get your feet wet.
4. High shipping costs – if your vendor/manufacturer is located far from Canada, shipping costs can rack up in a hurry. To save on shipping costs, you must optimize your logistics. Consider:
- Examining all possible packing configurations to minimize shipping cartons
- Shipping in bulk as often as you can – if you can bulk-ship to your customers 90% of the way, you can save the difference between bulk and retail shipping prices
- Verifying addresses before shipment as delivering to a wrong address can erase margins
- Rate-shopping carriers – many variables go into calculating carrier rates so be sure to rate shop every order