New program helps exporters expand their horizons
Small businesses in Canada can expand their horizons through a new program by the Canadian Trade Commissioner Service that offers them an incentive to develop and diversify their export markets.
Called CanExport, the program will provide $50-million over five years to small and medium-sized enterprises (SMEs) in Canada that are seeking new export opportunities, particularly in high-growth markets. CanExport shares the cost of eligible expenses for initiatives to develop new markets, including activities such as participating in trade fairs or doing market research. It is expected to help as many as 1,000 exporters per year across the country to better compete in the global economy.
“We are encouraging Canadian companies to look more outward,” says Elise Racicot, the CanExport program manager for Global Affairs Canada, which is administering the program through the TCS, in partnership with the National Research Council of Canada Industrial Research Assistance Program (NRC-IRAP). “CanExport will help Canada’s SMEs expand their export capabilities.”
CanExport is intended to build stronger and more competitive Canadian capacity to effectively compete in the global economy, by connecting SMEs with the tools and resources they need to succeed abroad.
Racicot says that CanExport compliments the large spectrum of services that the TCS offers to exporters. It provides a “bridge” between the assistance that companies get preparing for international markets from regional offices of the TCS in Canada and the help they receive from missions abroad, such as making introductions and facilitating contracts. “This program intends to bring companies literally to the market,” she says.
Many SMEs are not used to exporting or they have experience only with more traditional markets, she notes, and are concerned about the risk of developing new opportunities that can boost their prospects abroad. “They need to take the risk themselves, but we’re sharing it with them,” she explains, with the funds coming from the government offering “a push to explore new markets and new endeavours, in order to get out of their comfort zone and pursue new opportunities.”
Is your company eligible?
To be considered for CanExport funding, a firm must:
- Be a for-profit company in Canada, either incorporated or a limited partnership;
- Have a CRA business identifier number;
- Have up to 250 full-time equivalent employees;
- Have $200,000 to $50 million in annual revenues.
The program is “wide open” to all markets, except for activities in countries where sanctions could apply. For example, an SME may be looking to fairly traditional countries as a first step to diversify its customer base. “For a company that has never exported before, even entering the U.S. market can be quite an adventure,” Racicot comments.
Proposals will be evaluated based on the viability of the applicant’s export business case and whether the project is expected to yield incremental results and benefits to Canada. There will also be an emphasis on whether the activities are aligned with the Government of Canada’s trade strategies and their market potential, as well as, when applicable, the company’s export readiness and business history.
To be eligible a company must be for-profit, incorporated or a limited partnership, with up to 250 employees and revenues in Canada from $200,000 to $50-million. It must not have exported to the target country within the past 24 months.
Are your activities eligible?
Proposed activities must be part of the applicant’s long-term international business development strategy. They can include:
- International business development events such as exhibiting at trade shows, participating at conferences, trade missions, business-to-business meetings and visits. Note that action-oriented activities, such as planning targeted meetings with buyers or one-on-one matchmaking events, are considered by the program to have more value than passive activities such as walking a trade-show floor.
- Promotional and marketing tools and materials such as the adaptation of marketing tools for specific markets and website development targeting foreign customers.
- Research and studies such as custom market research via the services of a business consultant or market intelligence reports readily available for purchase.
Some eligible activities include business travel to meet with potential clients or agents; attendance at trade fairs, seminars and conferences; participation in trade missions; the development or adaptation of marketing tools to suit new markets; and paying for legal fees involved in signing agreements with local partners and distributors.
“Activities that aim at promoting international business development and go beyond the applicant’s core activities are generally being considered,” Racicot says, noting that the TCS especially advises business people looking to new export markets to visit, meet and create trusting relationships with potential clients.
“The most effective way to export to new markets is often to go there and make the first step of meeting with local companies and developing partnerships,” she says. “In certain countries, if you don’t go and invest in creating these relationships, it might never happen. The cost can therefore be high before you start seeing the return on your investment.”
The non-repayable contributions will be determined on a cost-sharing basis and can represent up to 50 percent of eligible expenses, which can include travel costs, event registration, translation and contractor fees. The payments are expected to range from $10,000 to $99,999, with a maximum contribution of $99,999 per year. The remainder of the funds can come from other sources, but the total of all government assistance cannot exceed 50 percent of the expenses for the project.
The application process is simple with a quick turnaround. Applications will be assessed within 25 business days, Racicot says.
She adds that through the program, the TCS hopes not only to provide an extra tool to its clients, but also to attract new clients, helping them to learn about the free services that are available to exporters and to match them up with opportunities abroad.
- Date Modified: