This article is part of a series of articles about international selling on Amazon. You can read a general overview of selling internationally on Amazon here.
Expanding a business internationally can be tricky. Not only do you need to address product-market fit, but you need to understand a bevy of international law, taxes, import/export regulations, and more. These are issues you simply don’t need to deal with if you’re only selling domestically.
Despite its challenges, though, selling internationally offers an opportunity for incremental revenue gains that can be an undeniable boost to any business.
When a B2B company is considering global expansion, Canada presents an intriguing and straightforward opportunity to tap into a burgeoning market. By leveraging Amazon's Canadian platform, businesses can extend their reach without venturing too far from familiar territory.
In 2023, Amazon.ca generated over $12 billion USD in revenue (about $17 billion in Canadian dollars) in 2023. While this is significantly smaller than Amazon in the U.S., it's still a substantial figure, having grown threefold since 2020. With more than 45,000 employees, Amazon Canada has been rapidly expanding since its launch in 2012. Compared with the more than 1 million third-party sellers in the U.S., Amazon Canada’s 41,000 third-party sellers offer a significantly less crowded competitive landscape.
Should Canada Be Your First International Foray?
Amazon Canada provides a natural first step into global expansion for U.S.-based companies for a number of reasons. For one, it’s geographically close to the U.S., potentially easing the logistical aspects of exporting products to Canada. The vast majority of Canadians—and thus Canadian businesses—live within 100 miles of the U.S. border. As a result, many major distribution centers, especially those catering to B2B needs, are conveniently located close to Canadian borders.
Just as importantly is the shared language and culture that Canada shares with the U.S. Approximately 76 percent of Canadians speak English as a first language, and even those in the French-language province of Quebec generally speak and read English fluently. That makes selling into Canada far easier than other non-English speaking markets, as it eliminates the need to translate product descriptions, names, etc.
Lastly, Amazon Canada offers most of the same features for sellers that you find in Amazon U.S. For example, Amazon Canada offers an Amazon Business program, and all the dashboards and tools sellers use to run their businesses are all presented in English. There are also many service providers, such as logistics and software tools, who provide support for the Canadian Amazon channel, making it easier to get up and running quickly.
Things to Consider before Selling on Amazon Canada
On the surface, Amazon Canada offers a perfect place to expand Amazon sales internationally. However, there are a number of things to consider and strategize before fully diving in.
Taxes, Customs, and Duties
It is essential to understand the tax implications of expanding into Canada. You'll need to navigate various taxes, such as the Value Added Tax (VAT) and the Goods and Services Tax (GST), as well as other local taxes that U.S. businesses generally do not need to contend with. While there are software tools to help you navigate the Canadian tax system, understanding what you’ll be required to pay is a key step in strategizing a Canadian expansion.
Additionally, you will need to familiarize yourself with the customs and duties requirements, procedures, documentation, and costs of getting your products into the country. Partnering with a customs broker or a logistics expert can simplify this process and help you avoid any pitfalls.
For more information, the Canadian government provides a wide range of resources and documentation to help business owners understand taxes: https://www.canada.ca/en/services/business/taxes.html
Separate Accounts and Management
While building a Canadian presence can leverage your existing content and other optimizations from your U.S. Amazon program, selling on Amazon Canada may require a new and separate account. The Canadian account must be managed independently from your US Amazon operations. This separation adds an incremental level of effort and requires dedicated resources to ensure smooth management.
That said, Amazon offers a unified North American account, which enables firms to sell in the U.S., Canada, and Mexico. These types of accounts, which carry their own fee structure, allow sellers to:
Share listing information and manage your inventory consistently across Amazon's U.S., Canada, Mexico, and Brazil stores.
Keep track of orders on multiple North American sales channels in Manage Orders or with one combined Order Report
Access tools and services to help you manage your business across the U.S., Canada, Mexico and Brazil stores
Pay a single monthly Professional selling plan subscription fee for your North America Unified Account
Update account information through a consolidated user interface
Get paid to your local bank in your local currency thanks to the Amazon Currency Converter for sellers
You can get more information on these types of accounts here.
Amazon Canada Operating Costs
As you might expect, selling on Amazon Canada comes with additional fees and resource considerations. Amazon will charge you for setting up a new account, and you'll need to ensure your products are Prime eligible. Similar to the U.S., Amazon offers Fullment by Amazon in Canada, which provides a path to ensure Prime eligibility for companies using the Seller Central selling model. You will also need to set up listings for Amazon Business Canada and invest in advertising to gain visibility and gain traction in the Canadian market.
Additionally, getting your brand registered in Canada is integral to protect your intellectual property and enhance your brand presence. The brand registry process in Canada is separate from the U.S., so you'll need to complete this step even if you’ve already done it domestically. You can read more about Amazon Canada’s Brand Registry here.
But What about Tariffs?
At the time of this writing, it is unclear whether the U.S. will place tariffs on products imported from Canada, causing Canada to retaliate and place tariffs on U.S. products sold in Canada. There has been significant news reporting and speculation, and there is currently a hold on any proposed tariffs.
To be sure, this is an evolving situation that needs to be carefully watched by any firm looking to expand internationally to Canada. Should any tariffs take effect, it may still be possible to sell in Canada, though at a reduced profitability. Taking potential tariffs into account when strategizing market entry will help in understanding your potential opportunity—and what you can do should they go into effect.
Ultimately, to successfully sell using Amazon Canada—or to any other market—you need to make sure you’re putting sufficient resources behind the effort. To aid 3P sellers in expanding internationally, Amazon offers the Amazon Global Selling program, which provides tools and resources to streamline the process.
But even better than software, it’s a good idea to have an Amazon expert on your side. That’s where Enceiba comes in. Whether you’re looking to take over the world with Amazon, or just grow a lot more at home, Enceiba can help you build a sustainable, successful Amazon program. Schedule a call with one of our Amazon experts to discuss your business goals and how we can help you achieve them.