A Guide to Successful Dropshipping
Participating in the Canadian drop shipping market can be highly problematic due to shipping and custom logistics that are inherent when having products imported into Canada. The issue of additional custom charges and shipping regulations has kept the Canadian drop shipping market small, but it is growing thanks to an increased number of Canadian wholesalers and distributors.
The startup strategy for a successful Canadian drop shipping business is dependent on whether you intend to sell specifically to customers in the U.S., in Canada or throughout all of North America. Selling to only one market keeps the customs and cross-border shipping problems to a minimum. Most importantly, the intended consumer markets must be related to your wholesale supplier. This means it's best to have a Canadian based distributor if you intend on focusing on the Canadian market. Global marketplace directories online are the best tools to use to find distributors and trading companies based in Canada.
If you plan on attracting the majority of your customers from the U.S., then it's advised that you obtain a U.S. based supplier. In this case, your supplier may not actively drop ship to your Canadian customers, but you can use a multi-national or international forwarding company to have the product drop shipped to Canadian customers.
Obtaining a business number is an important step towards legitimately selling products to Canadian customers. Some suppliers will not do business with your storefront if you do not have a valid business number. It's also crucial to pay attention to relevant Canadian tax and customs regulations. For example, imported goods incur a Goods and Services Tax (GST) charge, which may be transferred to you from the Canadian supplier as part of the service charges. A Provincial Sales Tax (PST) may also be charged if your business resides in Ontario or Saskatchewan. It may be worthwhile to hire a customs broker to assist you in understanding the exact border shipping logistics related to your business. To ensure a smooth business operation, a test run is always advisable to know what the true delivery period, cost and custom charges are.