The Benefits of Shipping Through Canada
With over 34 million residents who have similar interests as US consumers, Canada has become the top export destination of more than thirty-five states. Since entering the North American Free Trade Agreement in 1994, Canada has been USA’s largest trading partner and statistics show that trade with Canada is still growing so expanding into Canada should be a primary objective for all businesses looking to gain more market share.
Of all the freight that passes through the Canada / USA border, 82.2% is done on land by truck, rail and pipeline with truckloads making up the majority of that figure. The use of trucks for hauling freight is expected to grow at 4.7% per year, which is much greater than the growth rates of air at 1.7% and rail at 0.7%. Logistics professionals who operate where north meets south have forged a working relationship proving that cross-border cooperation can be a win-win situation.
What are the benefits of shipping to Canada?
U.S. companies should view Canada in both strategic and economic terms. Firstly, the Canadian dollar is extremely favourable to the export market and the United States in general. Cross border trade will grow faster than the overall economy which may experience setbacks. When the US went through a recession the Canadian dollar remained strong, and it opened up a large and eager market for American companies looking for alternative means of selling their goods and services. The Canadian market is far from saturated and both economies are conductive to growth.
Moreover, international shippers can avoid certain fees – such as harbour maintenance fees - by shipping through Canada instead of directly into the US. For example, if a vessel arrives in the Port of Vancouver or Montreal with goods from Asia that are destined for the United States they would be able to avoid the harbour fees because they didn’t come directly into the US via ocean freight. Shippers can also bypass the need to file an Importer Security Filing (ISF) when US bound shipments come through Canada. The ISF filings are mandated by U.S. Customs and Border Protection and are designed to identify high-risk cargo for inspections as it moves.
Another advantage of shipping to Canada is that transit times are generally shorter, with the BC port city of Prince Rupert being the shortest route from Asia to North America. For companies looking for quick and seamless delivery of their goods, shipping through Canada is becoming a more efficient and profitable solution.
Things to Know about Shipping to Canada
Although Canada is the United States’ largest trade partner, there are a few important differences that need to be taken into consideration before deciding to ship to Canada.
Since September 2001, security at the Canada/US border has tightened significantly which makes transit times longer than it used to be. Border wait times are publicly accessible through resources like https://travel.gc.ca/travelling/border-times-us , so being aware of and planning for these potential delays is manageable. The Canadian/US border is the most expansive and stretches across 8,891km of land and water with 119 border crossings throughout.
There are different regulations and compliance when shipping into Canada that you need to be aware of, which is why trusting a third party logistics company who has a dependable and experienced Canadian logistics system in place or partners with one is very important. They will already be aware of all of the differences within the regulations and will have planned for them accordingly. It is also crucial to ensure that your third party logistics company is multi-functional with the ability to quickly and dependably process reverse logistics as around 7% of good shipped are returned. The ability to seamlessly integrate this process will save you both time and money.