Small Businesses Urged to Venture Into the Great White North

About 90% of exports from Ontario, Canada, land in the United States. About $1 billion in transactions cross the the U.S.-Canadian border each day.

Given those figures, it might be difficult to imagine any American exporter neglecting the provinces.

But Patrick Diamond, general manager of HT Communications in Simi Valley, said many businesses, particularly small-scale operations, could take much better advantage of Canadian trade.

“Canada is very much overlooked by the business community, and the Department of Commerce has a hard time getting the word out,” Diamond said. “If you can sell here, you can sell there. If there is a market for something here, there is a market for it there. This is a very well-kept secret.”

Diamond’s praise of Canadian business opportunities is understandable, given his recent visit to the country as part of a Department of Commerce trade mission.

The three-day trip, which included visits with business leaders in Montreal, Ottawa and Toronto, was aimed at gathering information to help increase export opportunities for small and medium-sized businesses with a country that already is America’s largest trading partner. The tour focused on opportunities in the fields of language translation services, environmental services, high technology and telecommunications.

Diamond, who previously had participated in trade missions to Mexico City and China, was joined on the trip by U.S. Secretary of Commerce William M. Daly, U.S. Small Business Administrator Aida Alvarez, New Hampshire Gov. Jeanne Shaheen and representatives of 15 small to medium-sized businesses from around the country.

“The reception we got from the Canadians was tremendous. The interest level was tremendous--they went out of their way to tell us how to do business with the government, both federal and the provinces,” Diamond said. “William Daly continually made the comment that 50% of businesses in the United States have 100 or fewer employees and that that community doesn’t do nearly enough international exporting business.”

Diamond said HT Communications, a manufacturer of data communications equipment, is typical of the businesses the trade mission was intended to assist--those that are export-ready but not yet trading internationally.

Opportunities for these businesses, he said, should increase on Jan. 1, when the North American Free Trade Agreement eliminates tariffs on bilateral trade. Given the monetary savings and the contacts made with Canadian business leaders, Diamond said, he expects export business to represent a significant portion of HT Communications’ revenues next year.

“I would like to see if it would be able to generate 15% to 20% of our business next year,” he said. “The Canadian market is that significant, and the need for our products there is that significant. The barriers there have been removed and the contacts the government made for us . . . there’s no way you go up there on your own and make those connections.”

Those are the usual hurdles all small to medium-sized businesses must overcome, Diamond said.

“The main hindrances tend to be ignorance of the marketplace and ignorance and fear of regulations [of the other country],” he said. “Finding out what the rules are to export into a country is a real, real challenge.”

Scott de Ruyter, a trade specialist with the Oxnard-based California Central Coast World Trade Center Assn., calls Canada a land of opportunity for American companies. But, he said, few business owners approach trade with the country in the right manner.

“People tend to relax when dealing with Canada, but it is a foreign country and there are issues there,” he said.

“There are documentation issues, price sensitivity, metropolitan areas that they need to be aware of and transportation.”

For novice exporters, though, Canada still is a good place to start.

“One of the tips I give in my beginning seminars is to look for parallel markets,” De Ruyter said. “One thing Canada does have is they understand English and they have a lot of cultural similarities and disposable income.”