If you’re a Canadian small-to-medium-sized business owner that wants to grow your company, you may be facing some challenges. Perhaps you don’t know what the next, best move is. Or the cash needed to expand your reach is difficult to secure. Maybe you’d love some mentorship, but don’t know where to find it. These are common issues for many Canadian businesses, regardless of their size or level of maturity.
Happily, there is hope for your business’s growth and success – especially in Canada.
Here are some tips from experts who specialize in helping small-to-medium size Canadian businesses get off the ground and thrive. They have a ton of advice for finding and accessing helpful, pro-growth resources.
Grow by selling internationally
One of the best ways to grow your business strategically is to expand your reach beyond Canada’s borders. If you don’t currently export your products internationally, what’s holding you back?
Why exporting is worth the effort
If growth and increased revenue is your goal, exporting is key. You need to reach more people to make more sales and build your brand’s profile.
Here are a few facts that highlight the importance of selling abroad:
- Companies that export make 121% more than the average company.
- Exporters can better weather the economic up and downs of their local economy.
- Canada is a relatively small market to sell in, so selling in other markets is essential for growth.
- Made-in-Canada products have international appeal.
Obstacles to exporting
Though there are some obstacles to overcome along the way, it is definitely worth the effort and the investment to sell abroad.
There’s no need to venture into this brave new world alone. There are many excellent resources designed to assist Canadian business owners planning to export products.
Export Development Canada (EDC) is a great example of an organization that exists to help businesses thrive as they begin to, and continue to, export. It’s Canada’s export credit agency, and a financial Crown corporation.
EDC provides financing, insurance, bonding, trade knowledge, and matchmaking connections to help Canadian companies successfully sell and invest abroad. It also provides financial solutions to foreign buyers to facilitate and grow purchases from Canadian companies. Its financing and insurance solutions are provided on commercial terms.
Canada Post Solutions for Small Business™ spoke with Julie Pottier, Vice President of EDC, Commercial Markets & Small Business, about some of the obstacles that hold SMEs back from exporting their products.
Being unaware of opportunity
“Generally speaking, the biggest barrier that small business owners face is not knowing that they can export. In other words, they may not know that there are opportunities for them to grow internationally, and tools available to assist them,” explains Pottier. EDC offers tools that help make exporting manageable for small-to-medium-sized Canadian businesses – and profitable.
Being unprepared financially
Obtaining financing for exporting is wise. There are costs to exporting internationally – from duties to shipping costs, and the costs of meeting increased production demands if they arise.
“[The business] may find themselves taking on a contract that’s too large for them,” says Pottier.
Organizations like EDC offer helpful financing opportunities to Canadian businesses so they can export their goods without hesitation and prepare for the unexpected. But many Canadian businesses simply don’t seek out financing. Instead they start their exporting journey without a safety net, which is not advisable and can lead to disaster.
“Even high-growth SMEs can face complex export challenges. In foreign markets, it can be difficult to get the capital needed to bid on new international contracts, fill large purchase orders, or make a strategic acquisition. SMEs with export opportunities can also be in financing limbo—too mature to receive support from venture capital funds, and not big enough to access financing solutions from traditional financial institutions,” adds Pottier. That’s where companies like EDC come in to save the day – or the deal.
A constantly changing environment
“Another challenge is an ever-changing trade environment. The global economy is constantly evolving, introducing both new opportunities and potential stumbling blocks for Canadian businesses,” says Pottier.
Policies change, trade agreements are revised, and, as we’ve all recently observed here in Canada, duties and tariffs change. Luckily, organizations like EDC are there to help Canadian businesses weather the storm by keeping them informed of key changes and ensuring the business is equipped to handle the evolving environment.
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Are you tapping into your local resources?
EDC and several other organizations, programs and services are designed to give Canadian businesses a leg up when it comes to growth and selling internationally. By tapping into your local resources, you can obtain the assistance and guidance you’ll need to successfully expand your business and take it abroad. To take advantage of the opportunities available, you just need to know where to look.
Approximately 42% of business owners know about available government grants for SMEs – but don’t know how to apply for them. A staggering 32% aren’t even aware that there are grants out there to support them!
For those in-the-know who don’t bother to apply, the question that springs to mind is “Why?” As in so many aspects of everyday life, the fear of rejection can be an obstacle. In the case of government grants for SMEs, this fear is totally unfounded. In fact, it’s rare for Canadian businesses seeking support for international trade to be declined for the grants available.
Recently, a large group of Canadian small business owners were surveyed. Of all business owners, only 4 per cent have applied to government grants and been declined.
Other funding resources
Government grants aren’t the only financing options out there for SMEs. If your goal is to export your products internationally, there is ample funding available to support your efforts and help you get started. Many financing programs – like those offered by EDC, some non-government organizations (NGOs), and even banks – can provide you with the funds you need. They can also give you access to experts (or the funds to contract their services) to help you go international.
How to get support for your business
Here are the general steps to take to obtain funding, mentorship and access to growth resources:
Step #1: Determine if your business is fundable
Before you seek out business support from a third party, make sure that your business concept and plan is viable and fundable, and that you have some data to back it up.
“It’s one thing to have a “great idea,” and another thing entirely to have an enduring and highly marketable product or service,” says Craig MacMullin, President & CEO of CEED, a provincially incorporated NGO in Nova Scotia that’s committed to advancing and supporting entrepreneurs. CEED offers hands-on experiential education, face-to-face networking opportunities, and practical financing solutions.
“It is integral that the product or service is creating a solid and enduring solution to a problem that others truly need resolved,” adds MacMullin.
To prove that you’re sitting on a goldmine worth investing in, do your research. Find out who your target buyers are, and figure out a few compelling ways to demonstrate the need for your products in that niche.
“The customer discovery process is so incredibly important from just about every angle: from a financing perspective, the more clearly and robustly you can prove you have customers for your businesses product/service, the much more likely you are to secure funding,” notes MacMullin.
Organizations like CEED offer programs designed to help businesses strengthen their business concept or plan, existing product offerings, and pitch. Take their program Design to SucCEED, for example. It’s a multi-week workshop series that uses design thinking to determine a resolution for a consumer problem and/or problems through the development of a viable business model. They also offer a six-week workshop series called Fit to SucCEED which aims to validate the business model through a rigorous customer discovery process. CEED also offers great financing options for every stage of business through start up and expansion financing opportunities.
Step #2: Find a funding partner
Once you can demonstrate that your product will be in demand abroad, and that you are fundable, it’s time to find the right financing partner and make it happen.
Research is your best tool for finding the financial resources available to your business. Apply for all the grants that you qualify for, and take a few meetings with private organizations in your area that offer financial support and guidance to small businesses. Try to set aside time to apply for as many grants and programs as possible. It will dramatically improve your odds of success and help you narrow down your best partner(s).
If grants are the direction you want to go in, start by looking into any of the following excellent resources that are relevant to you:
- The Can Export Program is a Canada-wide grant that offers up to $50k to reimburse up to 50% of eligible expenses to promote your company in new international markets.
- The Strategic Innovation Fund is another Canada-wide option. It offers funding for R&D, expansion, investment attraction, and tech development.
Step #3: Find a growth mentor
A growth mentor can be a trusted advisor, an associate, a paid consultant or an organization. Ultimately you want to forge a strong relationship with an expert in business growth, especially a mentor who is up to speed on the ins and outs of exporting such as EDC. If your funding partner does not offer mentorship, they may be able to provide funds for you to hire a suitable mentor.
Once you find the right partners, and obtain your funding and mentorship, you are well on your way to successfully growing your business abroad.
Food for thought: The ripple effect of not exporting
If you take anything away from this blog post it should be this: You can do this, and you should. The reasons why might surprise you. The growth of your business impacts more than just your wallet and your business’ reputation. When Canadian SMEs abstain from trading internationally, it has a detrimental impact on the entire Canadian economy.
“We know that Canadian small-to medium-sized enterprises are a key ingredient to expanding Canadian trade and growing our economy. What’s concerning, however, is that only 10 per cent of SMEs are currently tapping into international markets and supply chains. This signals an opportunity – and necessity – to do more, especially when research also shows that exporting companies grow faster, are more resilient and innovative, and more sustainable than companies that don’t export,” explains Pottier.
Growing your business and exporting internationally is a great move for your business, you just need to get started. Take the first step by exploring the excellent resources in your area that are designed to support business owners like you in your efforts. Do it for your future, do it for Canada!
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