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Access Canada: A Guide on Exporting to Canada

Are you interested in exporting to Canada?

Exporting to a new market can be daunting even for experienced companies. This step-by-step guide will walk you through all aspects of how to export to Canada. It provides links to rich information on the Canadian market, trade data, sector reports, and much more to help you create your Market Entry Plan.

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Alcoholic Beverages

With 3 billion litres in volume sales and $CAD 21 billion in value sales, the Canadian alcoholic beverages market is an enticing proposition for Small and Medium Exporters (SME’s) from developing countries. The market profile is changing, with wine and spirits categories offering attractive opportunities. However, developing a solid business case, encompassing all the components of the “Route-to-Market”, will be critical to implementing a successful market-entry into Canada. This will require understanding the role of the Liquor Boards, Agents and Suppliers, integrating Corporate Social Responsibility into export plans, and full compliance with import regulations.

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Apparel and Textiles

The apparel industry in Canada was estimated to have sales of over $34.8 billion in 2017, and the textile industry import value was estimated to be valued at over $2.6 billion There has been steady increases in the sale of both menswear and womenswear, but the increase in men's clothing has surprisingly outpaced the growth in womenswear. Large retailers of apparel and footwear, such as Marshalls, Winners, Mark's, Reitman and Le Chateau, accounted for more than half of the total retail sales but consumers have dramatically changed their buying channel from instore to online. The fastest-growing distribution channel for apparel retailing is e-commerce which has grown from 6% in 2012 to over 11% in 2017.

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According to Statistics Canada, over $10 billion in non-alcoholic beverages was sold in Canada in 2015. While the consumption of beverages in Canada is high, the sale of beverages in Canada has seen an increase of less than 1% over the past five years. In fact, the actual consumption of beverages in Canada has decreased by 4% over the past five years from 98 litres in 2011 to 82 litres per person in 2015. The rate of consumption of soda beverages has particularly decreased significantly over the past 10 years in Canada due to the rising age of the population and the demand for healthier, less sugary alternatives. Consumers have begun to turn to healthier substitutes such as water and ready-to-drink tea. Products that contain certain health benefits should definitely illustrate these benefits in their marketing. Millennials in Canada tend to be more adventurous in terms of trying unique flavours and new ingredients. Imports account for approximately 20% value of the Canadian non-alcoholic beverage market. Canadian imports of beverages have increased in value by 10% from 2011 to 2015. The main source of imported non-alcoholic beverages to Canada is the United States with approximately 72% of total imports. The top five importers of beverages from TFO Canada supported developing countries are Chile (0.7%), Philippines (0.7%), Mexico (0.6%), Costa Rica (0.2%) and Ecuador (0.2%). The largest category of imported non-alcoholic beverages is the HS Code 220290 which consists of non-alcoholic beverages excluding fruit and vegetable juices with more than 32% of the total imported non-alcoholic beverages to Canada. HS Code 220290 includes soy beverages, non-alcoholic wine and beer, organic beverages and chocolate drinks. Imports under this category also have the highest import growth rate of all non-alcoholic beverage imports with a growth rate of 20% over the past five years.

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Building Materials

While residential construction is facing a depressed market into 2015, opportunities exist for suppliers of building materials for commercial construction and home renovations for seniors who want to remain longer in their homes. Opportunities also exist for materials that are environmentally friendly and innovative for all types of construction. After a sharp decline in 2011 to $930 million, the value of Canadian lumber imports reached just over $1 billion in 2013, approaching the five year high last reached in 2010. Imports of value-added products such as kitchen cabinets, wooden windows, doors, pre-fabricated wooden buildings, fencing, etc. reached a five year high in 2013 at $1.3 billion. Sourced mainly from the United States ($701 million), China ($318 million) and Austria ($52 million), several TFO Canada client countries were successful in claiming a position among the top ten suppliers in this category. Canadian imports of ‘other’ building products such as clay and stone tiles for flooring and walls, and cement blocks rose consistently over the past five years to reach $3.3 billion in 2013.

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Canadian Market Access Guide for LDCs

This Guide explains how to export goods to Canada on a duty-free and quota-free basis under the Market Access Initiative. It offers useful information on customs requirements, with a focus on the Rules of Origin. There are 48 eligible Least Developed Countries (LDCs) that can benefit from these favourable trade arrangements with Canada.

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Carpets and Rugs

The total Canadian market for carpets and rugs is estimated at over $4.5 billion in 2014. As residential construction and housing markets recover from the recession, floor covering stores have returned to positive growth projected at 2.4% over the next five years (2014-2019). Carpets and rugs represent half of business sales for the over 1,777 floor covering stores located across Canada. In addition to specialty stores, mass merchandisers and home improvement stores have aggressively entered this market, offering unprecedented product selection to Canadian consumers. While price competition has increased for computer-made carpets and rugs, opportunities also exist for high-end handmade carpets, with style preferences ranging from traditional to modern depending on the consumer. Canadian imports of carpets and rugs reached a five year high in 2013 at a total of $873 million. The United States represents a large portion of these imports, however many developing countries have reached top ten supplier status, including Egypt, Turkey and Nepal. Exporters must meet Canada’s strict regulations for flammability and may be eligible for certification by the Carpet and Rug Institute’s Green Label Plus programme.

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Corporate Social Responsibility Guide

In Canada, and around the world, companies, governments and consumers are increasingly interested in buying products and services that are produced in socially and environmentally responsible ways.  Small and medium sized companies exporting to Canada need to be aware of how purchasers and regulators of the products they sell are defining and evaluating social and environmental performance, so that they can meet expectations, and ensure continued access to markets.  This guidance document contains two types of information. This first is information on how CSR is defined and measured, why it is important for SMEs, and how the Canadian market is evaluating CSR performance of companies (Sections 2 to 6). The second type of information is specific step by step guide on how your business can improve its understanding, documentation, and communication of its CSR performance (Section 7).  Links are included throughout the guide to provide you with additional information, and in the Annex’s a glossary, resources and examples of supplier codes of conduct have been provided.

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Cosmetics, Spa and Beauty Products

The Cosmetics industry in Canada has an estimated value of about $9.9 billion in 2016. The industry has grown at an annualized rate of 5.5% over the five years to 2017. The industry has been expanding rapidly as consumers opt for beauty stores that allow consumers to interact with the products. While Canada’s economic growth has increased the industry’s revenue, demand for cosmetic products is still dictated by shifting consumer habits. Emphasis on development at the manufacturing level has increased the number of innovative beauty products, including high-end anti-ageing skincare products and cosmeceutical creams with pharmaceutical properties. Increase in consumer demand is expected to boost industry revenue by 3.5% in 2018. Positive consumer trends are expected to continue for the next five years to 2022 as economic prospects continue to improve. 

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Dried Food, Nuts and Spices

In 2017, imports of dried vegetables, roots and tubers reached a five year high of CAD$4 billion this was as a result of imports of dried fruits also reaching a five year high of CAD$ 2.1 billion, and edible nuts reaching CAD$854 million.  In the same year Canada imported $269 million of dried legumes and $371.1 million of rice. Imports of spices, herbs, and spice extractives rose by 3.2% between 2013 and 2017 to reach a five year high in 2017 of $276.2 million.  

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Environmental Management Systems

In Canada, and around the world, companies, governments and consumers are increasingly interested in buying products and services from companies who are responsibly managing, and reducing, their negative environmental impacts. Expectations are growing for companies to show real progress on key issues such as, climate change, and to be more transparent about their business and their supply chains.  For small and medium sized companies this will mean more demand for information on how they are managing and improving their environmental performance.  TFO Canada offers this guide as one of many resources to help small and medium enterprises prepare for the changing expectations of current and future markets

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Fishery and Seafood Products

Canada has a vast and diverse natural geography and is surrounded by three oceans – the Atlantic Ocean on the east, the Pacific Ocean on the west and the Arctic Ocean to the north. These oceans have provided Canada with diverse species of aquatic animals and plants e.g. finfish, shellfish, seaweeds etc., they also provide the environment for sustainable marine fish and seafood farming. These oceans have also provided Canada with comparative advantage in the fishery and seafood industries, that have also been a mainstay for Canada’s Indigenous peoples. This advantage along with government and private sector investments has made Canada a strong player in the global fishery and seafood industries.

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The total market for greenhouse flowers and plants in Canada grew by 2.6% to $1.4 billion in 2013, with indoor and outdoor potted plants accounting for over half of total sales.  It is now estimated that more than 9,000 retail outlets sell floriculture products across Canada, as local florists face mounting competition from supermarkets, big box stores and mass merchandisers as well as online retailers. Canadian domestic growers face increasing price competition from foreign imports, particularly from Colombia, which has benefited from the 2011 signing of the Canadian-Colombian Free Trade Agreement. Floriculture imports reached a five year high in 2013, at $370 million, led by mushroom spawn and other live plants including roots and cuttings ($136.5 million), cut roses and buds for bouquets or other ornamental purposes ($64.5 million), and cut flowers and buds for bouquets or other decorating purposes ($41.7 million). Imports rose from $344 million in 2012, and are on track for another annual rise in 2014 as buyers in Canada sourced 7% more from overseas suppliers in the first nine months of 2014 than in the same period the year before.

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The future looks promising for the footwear market in Canada. Despite a recent downturn in the economy and the falling Canadian dollar, footwear was one of the top performing categories of apparel during the 2014-2015 season. The total market for footwear reached a five year high of $6.6 billion in retail sales in 2014. An estimated 90% of demand is met through imports, mostly from China. Many of TFO Canada’s client countries are also major sources, including Vietnam, Indonesia, Cambodia, India, Mexico, Thailand, Brazil, Bangladesh and Dominican Republic. Sales of footwear closely follow the fashion calendar and weather seasons. Warm winter boots are a necessity during Canada’s famously cold winters, while summer brings on strong sales of athletic shoes and sandals. One of the biggest trends is a push towards comfortable and casual styles that offer orthopedic benefits without sacrificing style. Women are the largest consumer group, with over half of all footwear purchases made by women aged 35 and above. Following the wider growth trends in men’s fashion, the men’s segment is attracting increasing attention and expected be the center of growth in footwear in the coming years. While there are few specific regulatory requirements, many footwear items are subject to high tariff rates. This creates opportunities and cost advantages for exporters from countries with bilateral free trade agreements or least developed countries that are eligible for duty-free access to Canada.

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Fresh Fruits and Vegetables

In 2016, the Canadian fresh fruit and vegetable market reached an all-time high of $11.9 billion, but due to the seasonal limitation, 85% of all fresh fruits and 76% of all fresh vegetables were imported into the country. Imports of fresh fruit and vegetables rose for the sixth consecutive year, reaching $5.98 billion and $3.72 billion respectively. Even though Canadians are eating less than the recommended fresh fruit and vegetable servings suggested by the Canada Food Guide, the increase in fresh fruits and vegetables is largely due to increase in population and downstream demand from supermarkets and grocery stores, restaurants, hotels and motels and specialty food stores which have all increased, driving industry revenue growth.

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Following post-2008 recovery in housing construction and disposable income, the furniture market in Canada is estimated at $10.1 billion in 2014 with a projected annual growth of 2.1% over the next five years (2014-2018). Imports supply over half of the domestic market, amounting to $5.7 billion in 2013. An influx of foreign imports (especially from China) has intensified price competition amongst over 3,500 furniture stores located across the country. The market is consumer-oriented, with household sales for bedroom, living room and dining room furniture accounting for nearly 70% of 2014 sales, in addition to office furniture (27%) and outdoor furniture (4%). Canadians value durability and long-lasting pieces, with smaller niche markets for high-end furniture, particularly in the design centres of Toronto and Montreal. Industry innovation is being driven by Canada’s condo boom, with new lines of compact and multipurpose furniture, as well as millennial consumer demand for eco-friendly materials. Exporters must comply with Canada’s strict regulations on flammability and may be required to produce a phytosanitary certificate to demonstrate proper fumigation for certain wood products.

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Guide for Newly-Arrived Trade Representatives to Province of British Columbia

This Practical Guide provides for a newly-arrived Trade Representative to the province of British Columbia a practical overview of the province as a market for his/her country’s exporters. It also gives some background on the economy of Ontario, general market characteristics and demographics of that province, as well as variety of tools that can be used to better understand that market.

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Guide for Newly-Arrived Trade Representatives to the Province of Qubec

This Practical Guide provides a newly-arrived Trade Representative to the province of Québec a practical overview of the province as a market for his/her country’s exporters. It also gives some background on the economy as well as general market characteristics and  a variety of tools that can be used to better understand the market.

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Guide for newly-arrived Trade Representatives to the Province of Ontario

This Practical Guide provides for a newly-arrived Trade Representative to the province of Ontario a practical overview of the province as a market for his/her country’s exporters. It also gives some background on the economy of Ontario, general market characteristics and demographics of that province, as well as variety of tools that can be used to better understand that market.

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Halal Products

From finance to food, Halal in Canada has grown significantly within all industries. For the Canadian Halal food industry, specifically, there has been exponential growth over the last fifteen years in response to Canada’s growing Muslim population. Just as Canadians are from diverse ethnicities, Canadian Muslims are also made up of dozens of different cultures and races.

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Hardware and Hand Tools

Canadian imports of hardware dropped from $1.6 billion in 2008 to $1.4 billion in 2009, while imports of hand tools dropped even more dramatically, from $2.6 billion to $2 billion over the same period. However, there are signs that both markets are improving, with imports of hardware rising by 6.3% and those of hand tools by 2.4% in the first five months of 2010 compared to the same period a year ago. Since consumers are more conscious about security and energy conservation, sales of related devices for the home such as lights, locks, timers, alarms and lighting remain high. Energy audits, soon to be a requirement for home sales, will boost demand for these products.

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Hides, Leather Goods and Leather Apparels

Leather has re-emerged as a top fashion trend in recent years both on Canadian runways and retail shelves. Renowned for its softness, durability and luxury image, leather-made apparel and accessories have moved beyond the classic items of jackets, belts and gloves to include everything from pants, to dress shirts, to mixed fabric designs with leather accents. Canada’s domestic leather manufacturers reported their highest sales in five years in 2013 reaching a total of $430.7 million. In addition, Canada imported $98.3 million in leather hides this same year. Canadian imports of finished leather goods and apparel increased significantly from 2009 to 2013 to reach $303 million and $267 million respectively. Top products included leather handbags ($163 million), clothing ($90 million), gloves ($111 million), and sporting goods ($71 million). Italy remains a top leather supplier for luxury retailers, while China has emerged as a low-cost alternative. Strong opportunities exist for exporters from other countries, with recent gains by Vietnam, Indonesia and Colombia seen in this market.

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Home Decor

Home décor is an estimated $10 billion industry in Canada. Demand is expected to grow in 2015 as rising consumer confidence and new housing starts encourage consumers to invest more dollars into their homes. In addition to 3,800 home décor stores located across the country, products are also sold by specialty boutiques, mass merchandisers, and online retailers. Canadian imports of home décor reached $2.9 billion in 2015 and are dominated by Asian suppliers, especially China (60% of imports), as well as the United States (20%). Working age Canadians (30 to 55 years old) make up the largest purchasing group this sector with higher rates of home ownership, established families, and stable incomes. Young consumers (under 30 years old) are driving demand for budget-friendly and trendy home décor that are marketed through online platforms. Exporters must adhere to Canada’s regulations for labeling, health and safety. Glazed ceramics and glassware cannot contain more than trace amounts of lead and cadmium, while home textiles must meet strict labeling requirements based on their fibre content. Given the large size of Canada, the majority of home décor imports are processed through an agent or distributor.

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Jewellery and Fashion Accessories

The total market for jewellery and fashion accessories in Canada reached $4.8 billion in 2014, with an average growth of 4% annually over the past five years. Industry consolidation and volatile world prices for gold and silver have squeezed the profit margins of fine jewellers. Costume or imitation jewellery continues to gain market share as consumers follow fast fashion trends and seek out lower-price alternatives during hard economic times. Many Canadians, especially millennials, will splurge on occasional luxury items such as precious jewellery or designer watches and handbags, while making more frequent purchases of low to mid-price accessories to keep up with changing fashion trends. Most of Canada’s demand for jewellery and fashion accessories is met by imports, which reached a five year high of $2.4 billion in 2014. Fine jewellery accounts for half of imports ($1.2 billion), followed by fashion accessories ($1 billion) and costume jewellery ($264 million). The United States and Europe remain major sources, while lower-cost items are dominated by low-cost countries especially China and India. Exporters must be aware of Canada’s strict regulations for lead and cadmium content in children’s jewellery as well as detailed rules for marketing and labeling of precious metals and textile fibres.

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Manufactured Foods

This report covers baked goods; confectionery; specialty products such as frozen and canned foods; other manufactured foods such as snack foods; and poultry and meat products. In 2011, food sales by large retailers in Canada amounted to about $41 billion. In that year, Canada imported nearly $10 billion worth of manufactured foods, led by specialty foods, meat products, and confectionery and sugar products. In 2011, imports of sugar and confectionery products rose to their highest level in five years to $2.4 billion. Also reaching five year highs were imports of snack foods ($458 million), and baked goods ($1.26 billion). Specialty foods imports amounted to nearly $3 billion while imports of meat products were $2.8 billion, just over $400 million higher than the previous year.

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Natural Health Products and Health Product Ingredients

The growing and diverse Canadian population is becoming increasingly health conscious leading many to integrate preventative health measures in their daily lives.  This proactive behaviour and now common trend of a health lifestyle has triggered a surge of consumer spending on Over the Counter (OTC) health products and Natural Health Products (NHPs) in Canada.  Natural Health Products are a class of health products which include: vitamin and mineral supplements, herbal preparations, traditional and homeopathic medicines, probiotics and enzymes.  The Canadian Health Food Association (CHFA) estimates the market value of NHPs to be $4 billion and OTC market value at $6 billion at the end of 2017, making a total of an estimated $10 billion of all consumer health products.

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Organic and Ethnic and Fair Trade Foods

Canada is the 4th largest organic market in the world, and due to the immigration trend over the last 30 years, also one of the fastest growing market for ethnic foods. Canada imported in 2015 over CAD$850 million worth of foods in the category of Organic, Ethnic and Fair Trade foods, and increase of over 13% over the previous year total of $757 million dollars.
Much of the demand in this category is driven by a change in the Canadian consumer’s, who is becoming more and more health and socially conscious, leading them to seek out Organic and Fairtrade foods. That same mainstream consumer has been in contact with a variety of ethnic foods, either through travels, ethnic restaurants, or friends, and is seeking to re-create those flavours at home, driving the demand for ethnic ready-made foods, seasonings, sauces, and snacks.
While most of the consumers of foods in this category tend to be between 20 and 36 years old, known as Millennials, and female, this category is growing in mainstream acceptance, with older people seeking to adopt a healthier life style, and more families wanting to raise their children with healthier and more diverse foods.
The foods in this category can be found in large scale retailers, like Wal-Mart, Loblaws, and Metro, and also in speciality stores like ethnic and organic stores, which can be large chains like T&T Supermarket, Whole Foods and Planet Organic, or small and medium size independent grocers, many of which are in corner store format. With the statistical information gleaned we were able to extract which were the most imported products into Canada for this category (mainly coffee, bananas and olive oil), where were they coming from (U.S., Mexico and Colombia), and also where do opportunities lie for new products and which countries are expanding their exports the most. 
Market entry considerations in this sector must be carefully researched while most products in this category sell at a premium price compared with regular products much of that premium goes to cover the extra cost associated with specific certifications, labeling and packaging regulations that govern these products. It is important to note that currently the Canadian Food Inspection Agency is undergoing a revision of the Safe Food for Canadians Act, and some of the proposed changes will affect this category and can potentially increase the cost of compliance.
Most of the foods in this sector comes in through the same distributions channels as regular food, initially clearing through major city ports of entry such as Toronto, Montreal, Vancouver, from which they are distributed to the rest of Canada. Because of Canada’s large size, additional costs for transportation and refrigeration for keeping the food fresh must be kept in mind by exporters in this sector. 

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The Public Health Agency of Canada estimates that 67% of direct health care expenses are spent on chronic conditions such as diabetes, asthma, and congestive heart failure; these conditions are becoming increasingly prevalent as the population ages. In 2006, the total prescription pharmaceutical market in Canada was $17.8 billion, up 7.9% from 2005. Generic drugs fill 45% of all prescriptions in Canada, yet in 2006 the brand name industry experienced its strongest performance in three years and growth is expected to continue at an annual rate of 7.5% to reach $24.4 billion in 2010. This report provides information on industry trends and other factors shaping demand, sales opportunities, trade practices, stringent import regulations and additional sources of information for exporters. 

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Processed Fruits and Vegetables

In terms of trends, you'll notice that imports in the provisionally-preserved category have remained steady (except for expanding, cherry markets), while markets in the canned food sector have shrunk (as Canadians have chosen healthier lifestyles involving less processed food and more fresh produce and prepared meals). Frozen food markets have also shrunk, except for increased demand for frozen fruits and vegetables, both of which tend to be cheaper than fresh produce while still offering similar health benefits. Of note, demand has jumped for frozen blueberries, frozen carrots, other frozen fruits and for canned tomatoes. (See section 3 for more details about trends and opportunities.)

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Over the past decade, services – including manufacturing and agriculture, have been the fastest growing sector of the economy. Services such as telecommunications, financial and transport services provide the infrastructure and specialized inputs for all economic activities, as well as the health, education and cultural supports for quality of life. This report describes the dynamic service environment in Canada which includes a wide and complex variety of transactions that are generally intangible in nature. In Canada, the service sector is an important contributor to the economy. According to Industry Canada, in 2005, services accounted for 68% of GDP, and employed 75% of Canada’s work force.

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