True North - Realistic Expectations For Commercial Success In Canada

If you are a US manufacturer and you have the desire and ability to sell your products into Canada, you need to understand the potential of the Canadian market and temper your expectations. It's really very simple, yet some US manufacturers fail to understand the commercial potential of the Canadian market. The result is that US manufacturers are often disappointed with sales results when in fact they should be pleased, or at least accepting.

When you consider that Canada's population is roughly 11% of the US population, and the GDP of Canada is roughly 11% that of the US, it would follow that sales into Canada should be roughly 11% of what they are in the US. Oversimplified? Not at all. In fact, when you consider GDP adjusted for Purchasing Power Parity, the Canadian market is closer to 9% of the US's size. Let's keep it simple and say 10%. Add to that the dramatic strengthening of the Canadian dollar in the last decade, and it needs to be understood that a lot of Canadian manufacturing has moved to the US. Given that over 75% of the Canadian population lives within 100 miles of the US, it's relatively simple to move the finished goods back into Canada.

What is the basis, then, for higher expectations? If, for example, one expects sales into Canada to be 20% of the US sales total, the question is simple - who will use the product?

Taken a step further, if YOUR Company's sales are in fact 20% (or even higher) than your US sales, the question needs to be "Why aren't we selling more in the US?" Now THAT, is a fair question.

If YOUR Company is positioned to sell your product into Canada or other countries, there are factors that need to be considered. International markets offer a great deal of potential, some more than others. Regionalization is important, and often necessary, for commercial success. Using Canada again as the example, there are cultural and socio-economic elements that demand a different approach for sustained success - and we're neighbors! Imagine the differences as you move further away from the US.

Foreign markets are in various stages of development, and their consuming classes can be significant in size. The world is smaller than ever, and ore reachable too. Designing a regionalized strategy for commercial success in Canada and other International markets will help take YOUR Company to the next level.