Expanding our Business into Canada - Research Paper Example

Running head: Expanding our Business into Canada Expanding our Business into Canada Business in Canada Canada is one of the largest countries in the world, despite its small population. Located in the north of America (HLB international Canada 2008), Canada is one of the industrialized countries which engages in trade with other countries and therefore among the great seven (G7) group of economic powers. Canada is also a member of the general agreement on tariffs and trade (GATT), thus making the country competitive as it engages in international trade. While doing business in Canada and one wants to import any goods, the Canada Border Services Agency (2010) advices that, before importing any goods to Canada, one must be in possession of a business number from the Canada Revenue Agency for an export account. Also, one must have a clear knowledge of the goods that he/she wants to import and from which country the goods are manufactured. The goods must also no belong to some of those restricted to enter the country. Moreover, the tariff classification, rates of duties and tax charged on imports are a major consideration when it comes to importing of goods to Canada. According to the guideline on doing business in Canada (HLB Canada 2008), for one to expand his business in Canada, there are a number of things that must be considered and put in place. These issues include; for instance, if one wants to start a business in certain province in Canada, “he needs to register his business as an extra- provincial corporation in that province” (DBC 2008). In addition, all the procedures must be followed to the later. First of all, for a company which seeks to expand its business in Canada but already has an existing business in their country of origin, it can apply to go to Canada as business immigrant, however, there are three types of business immigrants, which include investors, entrepreneurs and self employed business immigrants. According to the citizenship and immigration Canada (2010), “business immigrants have to make a C$800,000 investment or own and manage business in Canada and must also meet certain experience.” For investors who seek to expand their businesses to Canada, they must be experienced in business, they should at least have a “minimum of c$1,600,000 net which must have been obtained genuinely, and they should also manage to make a c$800,000 investment” (CIC 2010). Nevertheless, business is considered as the main backbone of any country and so, being cautious when it comes to foreign investors is very important. Cultural factors The economics of the country as it relates to doing business there and business etiquette (how to be polite in that country when doing business, their customs and manners) In Canada, the main spoken languages are English and French, both of which are national languages. Canada is mainly associated with polite and tolerant people. Generally, the main form of greeting in Canada is by a form of a firm handshake which is inclusive of a smile and a direct eye contact (Gorrill, 2009); however, other forms of greetings may involve a light kiss on the left and right cheek. While invited by somebody for dinner, it is always a good gesture to carry a gift, which may include wine, flowers or chocolates. In the business etiquette, Canadians practice politeness at all times and they expect that others will adhere to politeness as well. In a business meeting, it is essential to shake everyone’s hand in the meeting room. Surnames and honorable titles are not commonly used in Canada, instead, academic titles are found more appealing such as Dr, Mr. or Mrs. In addition it is a custom to make sure that business cards are in both English and French languages for easier clarity for the two languages speaking citizens (Gorrill, 2009). If one wishes to conduct business in Canada, then he/she should be aware that Canadians communication is indirect. Non-verbal expressions are mainly used to emphasis on a message. The Canadians also prefer some distance while communicating to someone. In addition, in Canada, it seems awkward to discuss personal lives with business associates. In case of business meetings, time keeping is essential, since Canadians value meetings, and delays are not an excuse. However, meeting appointments are confirmed earlier to avoid any disappointments. Generally, the normal “working hours in Canada range from 9am to 5pm”, and when presenting any form of information, Canadians prefer the use of facts and figures, rather than the use of promises and claims (Gorrill, 2009). According to Communicaid (2006), the Canadians encourage open discussions in their meetings and don’t make hasty decisions. Incase business is being conducted in the East of Canada; the requirement is to have business documents typed in French and English. Good morals and discipline is attracting to Canadians, thus they may quickly gain trust from such a business party. Mostly, Canadians only discuss business with their business associates; personal life is not at any time associated with business. Canadians discourage underestimation of the fellow business associates; however, this behavior is viewed as boastful and unethical (Communicaid, 2006). Therefore, it is essential for every potential business person wishing to invest or expand his business to Canada to abide by the rules and values of this country. Hence, when the cultural values and traditions are valued by foreigners, it becomes easier for their businesses to run smoothly. Analyze your cultural factor information and the impact the factors would have on our expanded business and this product. The business etiquette of Canada can influence greatly foreign businesses that would want to expand in that country. For instant, incase our company expanded its horizon to Canada, then there are a number of factors that it should consider. For instance, Canada is an English and French speaking country, therefore, this business should be in a position to communicate in both languages whether in business meeting or through advertisements. In Canada, breakfast cereal is common and according to Anon (2011), author of Canada Free News, Ontarians are eating healthy food from the farms. Also, the presence of risk management programs is playing a big role in supporting farmers during the unpredictable weather and market changes. Expanding a foreign firm to Canada simply means that, the business has to follow protocol, starting with the knowledge of the cultures of Canada to the business rules and regulation. In addition, the cereal company should mainly be prepared for competition from within. Therefore, cultural factors and business etiquette should be maintained by any foreign business expanding to this country. As a cereal business expanding to Canada, the most challenging issue would be to select business associates to deal with while entering the market. As discussed earlier, Canadians are more indirect in communicating compared to other countries. It is hence important for such a company to learn the culture of Canadians when it comes to conducting business. Time keeping may be another factor that could contribute on how well the business markets itself. This company mainly deals with cereals which are a great influence to children and teenagers; therefore, to be able to market its product, it should be able to advertise differently, for instance, introducing some of these samples to schools in order to attract more customers. One of the impact these cultural factors would have on the cereal business are the languages used, especially if the cereal company is not familiar with French language, which means that it will have to hire someone to interpret the language, thus incurring more costs. The other factor is the means of communication used by the Canadians which is indirect. Here, for the foreign investors to be able to cope, they have to learn this aspect about the Canadians. Nevertheless, some other factors that may affect businesses in Canada include the economy, price fluctuation of the raw products and climatic conditions that affect agricultural goods. In the case of cereal, the mother product is wheat; if wheat is affected by the unpredictable weather conditions, this only means that its price will rise due to the low supply. This makes the market for cereals very competitive, thus leading to compromising prices by the distributors and low returns. Give your final opinion as to whether you think we should or should not do business there. Support your decision. According to Toronto Sunday article by Sims (2011), food prices in Canada are rising; further, there is a possibility for the food price to increase to 8% as the months pass by. It further explains that the wheat associated products like cereals will rise in price due to the rise in price of wheat and corn. This is a clear indication that the cereal market is not doing so well at the moment. Therefore, for a foreign company to engage in the cereal business in Canada, it must be prepared for low profits until the markets can adjust. Otherwise, it can choose to lower its entry prices so as to attract more clients, but this may create rivalry in the market. The main agenda for the cereal company according to CIM (2010) is that, the company can either engage in business inform of investors or entrepreneurs. Each of these types of businesses has requirements that must be met. For the investors, they have to have business experience in order to invest in that country and in addition, c$1,600,000 net which should have been obtained in a genuine manner. The Canadian immigration also requires these business investors to make about c$800,000, which will then be refunded by the CIC after five years (CIC 2010). With all these types of requirements, and according to Sims (2011), at the moment wheat is very expensive in Canada, then it is only wise to wait for the market to improve before expanding the cereal business to Canada. Conclusion According to IIC (2011), Canada has been rated among the top countries favorable for conducting business among the G7 countries. This is because Canada has encouraged business by creating an environment that promotes business in the country. In addition, Canada proves to be a very conducive environment to do business due to the presence of pleasant cultural values and business etiquette. However, the type of business to expand in this country may vary depending on the investors and entrepreneurs’ tastes. This depends on the capability to abide by the rules and regulations of conducting foreign businesses in Canada by the company’s wishing to expand their business in this country. According to CIC (2010), there are three types of immigrant businesses that foreigners may engage in; these include investors, entrepreneurs and self employed. Canada being the second largest country in the world, and being among the G7 of the world economies, has a great economy of which the Canadian government encourage investors and entrepreneurs to invest in the country in order to boost the country’s economy. References Anon. (2011). Premier Dalton McGuinty at 2011 Agri-food Summit – Good News for Family Farms in Ontario. Canada Free News. Retrieved from http://cornwallfreenews.com/2011/04/premier-dalton-mcguinty-at-2011-agri-food-summit-good-news-for-family-farms-in-ontario-april-4-2011/ Canada Border Services Agency. (2009 Oct). A step by step guide to importing. Retrieved from http://www.cbsa-asfc.gc.ca/sme-pme/i-guide-eng.html. Citizenship and immigration Canada (CIC). (2010 Dec). Retrieved from http://sbinfocanada.about.com/gi/o.htm?zi=1/XJ&zTi=1&sdn=sbinfocanada&cdn=money&tm=689&f=00&tt=12&bt=0&bts=1&zu=http%3A//www.cic.gc.ca/english/immigrate/business/index.asp. Communicaid group ltd. (2006). Doing Business in Canada: Canadian Social and Business Culture. Retrieved from http://www.communicaid.com/pdf/Doing%20business%20in%20Canada.pdf Gorrill, J. (2009). M.A. Intercultural Communication. Retrieved from http://www.communicaid.com/access/pdf/library/culture/doing-business-in/Doing%20Business%20in%20Canada.pdf. HLB Canada. (2008 Jan). Doing business in Canada. Retrieved from http://www.hlbi.com/index.php?option=com_content&view=article&id=37&Itemid=19. HLB international. (2008). Doing business in Canada. A member of HLB International, A Invest in Canada (IIC). (2011 Feb). Business Environment Advantage. Retrieved from http://investincanada.gc.ca/eng/advantage-canada/business-environment.aspx Sims, K. (2011). Toronto Sunday newspaper - Food prices continue to soar. Retrieved from http://www.torontosun.com/news/canada/2011/03/20/17692081.html. Read More