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Tips For New Importers

Start small

There is nothing wrong with thinking big and imagining your imported product in all of the stores across the land but for the new importer it is wise to start small. Starting small allows you to limit your initial risk and get your feet wet before betting the farm. There are a number of reasons for starting small.

  1. You are bound to encounter problems and make mistakes, especially in the beginning. Iron out those issues before investing larger amounts.
  2. With less invested in the business it is easier to accept losses or walk away from a bad idea without losing your house.
  3. It will make it easier to get financing for growth if you can show that you have had small scale successes.
  4. Investors (family, friends etc..) are more likely to back your idea if you can show that it can be done.

Research, Research and Research some more

You have your fantastic idea but what do you really know? Spend some time on the internet, in the library and in the marketplace investigating everything to do with your product.

  1. Search for published articles on your product and market. You can find material at your local library using their online resources.
  2. Find statistics, demographics and psychographics.
  3. Obtain supplier details for product prices.
  4. Find the HS Code for the product and check applicable duties and tariffs.
  5. Investigate the competitors; their websites, locations, prices, promotions, signage, sales etc...
  6. Find and contact the appropriate industry association.
  7. Visit your local Business Information Centre office.
  8. Does your product have to follow specific labelling and packaging regulations? Find out.
  9. Do you need a UPC bar code?
  10. If possible, interview the competition.
  11. Find the Financial Performance Indicators for your industry.

Do not bring in too much inventory

It is common to overestimate your initial sales. For your first shipment limit your order to a small quanity. Order enough to provide product samples and some initial sales. Essentially you are testing the market. Is your price point correct? How many unit sales are you making (per day, week or month)? Is there strong interest from your potential buyers?

Ignore the Big Players

Stay away from the likes of Wal-Mart, Loblaws, Zellers, Safeway etc.. These large chains generally will only deal with large suppliers. You may have heard or read a story about a small business that got their product onto the shelves of one of these stores, but these entrepreneurs are one in a million. The large chains are extremely expensive to do business with.

  1. Most charge upfront fees in the tens of thousands of dollars just to list your product.
  2. Since you are replacing someone else's product you will be required to "purchase" their entire inventory or the product being replaced.
  3. You have to guarantee that your product will sell.
  4. You will have to commit to spending very large sums of money on advertising campaigns.
  5. You will be hit with fees for all kinds of issues.
  6. Some require you have representatives that will visit all the stores to reface shelves.

Allow for Adequate Transport Times

You have just spoken to your potential supplier or freight forwarder and have received an estimated shipping time from country X to Canada. 12 days. Fantastic, 12 days is easily manageable. Wrong!!! Under ideal conditions, when everthing goes exactly as planned you may have your goods in 12 days. More likely there will be problems so plan for them.

  1. Your shipper may only have one ship per week leaving country X. So if your supplier is only a few hours late your 12 day shipping time is now 19 days.
  2. Your home port of Vancouver, Halifax or whatever is backed up and consequently your ship is stuck in the harbour for an extra week waiting for space to dock. Your shipping time is now 26 days.
  3. Canada customs wants to inspect the container that contains your products. Shipping time is now 35 days.
  4. Your train is delayed in Edmonton. Shipping time is now 40 days.

You can see from this illustration how easily your shipping time can be doubled or tripled. Don't forget that bad weather, strikes and civil unrest can also impact shipping.