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WELCOME TO CANADA
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STARTING YOUR OWN BUSINESS IN CANADA?
While Canada may be known as a “nation of immigrants,” the country’s economic engine is certainly its small business sector — about 98 per cent of employer businesses are defined as “small,” according to Industry Canada. And immigrants are a big part of that. Statistics show approximately 19 per cent of immigrants are selfemployed, compared with 15 per cent of the rest of the Canadian population.
Many newcomers look to entrepreneurship as an alternative to the job-search grind and no-Canadian experience barrier. It’s also an attractive option for potential immigrants looking to come to Canada, thanks to Canada’s new Start-Up Visa program, which is designed to attract entrepreneurs from around the world. This program is ideal for entrepreneurs with experience running a successful business elsewhere, as they will need backing from a business incubator, venture capital fund, or Canadian angel investor group to apply.
Canada offers many opportunities for entrepreneurs, including a stable economy, well-established regulations and processes, and good access to funding relative to other countries. On average, 150,000 new small businesses are created in Canada annually, but only half or so survive their first five years.
So what makes one small business succeed and another fail? There are lots of variables that lead some business owners to success, and others not, but following a detailed plan of action with plenty of thought and research will certainly help. Here
Here are 8 steps to launch
By Margaret Jetelina
are eight steps to help you launch your business.
1Decide what you want to do
People decide to start their own business for many different reasons. Perhaps you have identified a service or product that people want or need, or you have a desire to improve people’s lives. Maybe you want to import a product from your country of origin to Canada, or you want to start a service business utilizing your professional skills, or you are looking at a franchise business or neighbourhood restaurant. Consider what you are really passionate about. What do you want to do, and why do you want to do it?
2Do your market research
As a newcomer to Canada you may have a great business idea, but before you invest too much in any idea, sit down and do your market research. Look at your potential customers, competitors and more. If you have an idea for a product or service, make sure that there is a realistic need for it. How many people will use your business, and how much will they pay? Is what you offer unique? Decide what will set your business apart from others. The Canada Business Network website has tips on how to conduct market research as well as up-todate information and statistics. See canadabusiness.ca/eng/.
3Write a business plan
A business plan is a comprehensive document that details everything. It shows where you want to go and how you’re going to get there. It is a living document that includes information on your business offerings, goals, competitors, staffing, expenses, marketing plan and forecasted income.
Your business plan should have three main purposes: • To determine the feasibility of your idea. • To document a strategy and direction for your business. • To share information with external parties who have an interest in your business, such as investors.
There are many resources available to help you write a Canadian business plan, including an interactive business plan writing tool at scotiabank.com/ smallbusiness. Make your business plan a priority and give it the effort it deserves.
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4Register your business
The process and requirements for registering a business vary from province to province. Check with your municipality to find out if you need a business name, licence, permit and whether you meet zoning and bylaw requirements. Industry Canada's BizPaL is a really useful tool for finding out what permits and licences you'll need to do business. You will also have to register for federal and provincial taxes.
You’ll also have to decide on a business structure, which have different tax implications. The most common forms are: • Sole proprietorship — if you run the business on your own, you’ll pay personal tax based on your business income. • Partnership — if there’s more than one person running your business, you can form a part nership. You’ll pay personal tax based on the portion of profit from the partnership allocated to you. • Corporation — this is a sepa rate legal entity with share holders that pays its own tax. As the owner, you’ll be an employee of the company.
Other considerations include the issues and responsibilities you will have if you have employees. This includes payroll obligations, labour laws and registration with the Workers’ Compensation Board. Purchasing insurance for your business may also be a factor.
5Finance your business
Your business plan should give you an idea of your costs. Consider production costs, shipping, worker's wages, rent for workspace, taxes and profit for you! Check to see if you are eligible for grants, contributions and financial assistance from federal and provincial governments.
In addition to your own savings, financing options you may want to consider including loans or private investments from family or friends, business investors and small business financing from your financial institution. The Scotiabank StartRight for business program1 has been designed specifically for landed immigrants who have been in Canada for three years or less to access credit and help start a business. It offers new small business owners an opportunity to build credit history while fueling their entrepreneurial dream. Scotiabank further supports entrepreneurs with its Scotia Running Start for business® banking package2, which has been designed especially for businesses that are less than two years old and provides savings on bundled personal and business banking services and other special offers. 6 Build an excellent team
Assemble a team of staff, suppliers and partners that share your same values of hard work and excellence. Know when to delegate based on people’s expertise and skillset, but maintain your leadership and vision as the owner of the business.
7Promote your business
There are many ways to promote your business, and the most effective method depends on what kind of service or product you offer. Consider creating a website and business cards, joining trade associations, advertising in the local paper, distributing flyers or advertising on the radio, television or in newspapers. Don’t underestimate the power of word-of-mouth and social media; these may be your strongest assets in today’s economy.
8Find support
It’s important to have people in your corner who will support your plans and encourage you when things get tough. This can include family and members in your community, but can also be mentors who own their own business or work in your chosen industry. Connecting with other business owners is easy — you’ll find that business owners like to attend events organized by their local Chamber of Commerce or Board of Trade. Contact a local office for a schedule of upcoming networking opportunities and get involved!
Immigrant small business owners at a glance
According to Industry Canada, 21.7 percent of SMEs in Canada had a majority owner or CEO born outside of Canada. Here is the breakdown of immigrant owners by province:
British Columbia: 28.6% Ontario: 27.5% Alberta: 24.5% Saskatchewan: 14.4% Manitoba: 11.3% Quebec: 11.2% Atlantic region: 11.3%
® Registered trademarks of the Bank of Nova Scotia. 1 Subject to meeting Scotiabank’s credit criteria and security requirements. Standard interest charges are applicable. In addition, to be eligible you must be a Canadian resident and have reached the age of majority. Personal guarantees required for business credit. A credit card may be available up to certain credit limits without further security; where required, further security must equal to 100 per cent of approved credit limit. Credit card security can be assets such as cash security, Canada Savings Bonds or Guaranteed Investment Certificates. 2 The package components that are available to new Scotia Running Start for business® banking package customers and any introductory fee offers that are available are subject to change without notice. Subject to meeting Scotiabank’s credit criteria and security requirements. Standard interest charges are applicable. In addition, to be eligible you must be a Canadian resident and have reached the age of majority. Personal guarantees required for business credit. 22
“I know how hard it is to establish your finances in a new country.” —Scotiabank ® advisor
Our advisors can help open the door to your new start in Canada.
The Scotiabank StartRight ® Program1, specially designed for newcomers, helps you settle quickly in Canada. Let one of our advisors show you how.
® Registered trademarks of The Bank of Nova Scotia. 1. The Scotiabank StartRight Program, created for Canadian Landed Immigrants from 0–3 years in Canada, International Students and Foreign Workers.
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CAR BUYING IN CANADA
Choosing a model is just the first step; financial decisions come next
By Margaret Jetelina
Ready to buy your first car in Canada? There are many considerations, the least of which are style, colour and model. The bigger question is how are you going to finance it?
Cars are not a cheap purchase today, with most new vehicles starting around $20,000. And don’t forget about the high costs of gas and maintenance! If you want to buy a safe, reliable vehicle for your family, you may want to consider buying a brand-new or near-new car with the help of financing — leasing or buying. premiums by completing one of these programs. • Compare multiple providers. Some compa nies offer a discount if you quote online. • Combine policies. Many insurance companies offer discounts if you insure your home or other vehicles with the same institution. • Select a higher de ductible. By increasing the amount you pay out of pocket, your premiums may be lower. The key is choosing an amount you can afford to pay if you ever need to make a claim.
Leasing vs. buying
You may choose to lease or buy a car outright with the help of either a car loan or dealer financing. Canadians often shop around for car loans at financial institutions or through the dealer where they buy the car.
Leasing a car is a popular option for self-employed people, as they can write off the payments on their income taxes. Further, monthly payments are lower, but you don’t actually own the car. You are basically signing an agreement to use a new vehicle for a defined period of time (typically 24, 36 or 48 months). At the end of the lease term, the car is returned to the dealer, or you can purchase the vehicle at an agreed-upon price.
Purchasing a car may increase your monthly costs for the financing term (usually 48 or 60 months), but then you own the vehicle outright and you can keep driving it with no payments for years to come. The Scotiabank StartRight Auto
Finance Program1 provides auto financing solutions for landed immigrants and foreign workers who have been in Canada for three years or less. The program provides a financing option for the purchase of a new or used vehicle — loans for up to 60 months to a maximum loan amount of $100,000.
In the short term, leasing will probably cost you less than buying. But a longer lease term will result in higher carrying costs. Leases also have limitations on the car’s usage, such as a limit of kilometres annually (going over means paying high penalties).
Car insurance cost
The cost of auto insurance is also an important consideration. If you drive in Canada, auto insurance is mandatory. It protects the owner/driver, passengers, pedestrians and property affected by a vehicle collision. Car insurance can be expensive, varies from province to province and depends on your driving record and other factors, such as the type of car you are insuring. Here are a few tips to save on auto insurance: • Complete a driver educa tion program. New drivers can acclimatize to driving in Canada and qualify for lower • Pay a lump sum. Some insurance companies offer discounts if you elect to pay your insurance annually instead of monthly. • Consider your car. The make and model of your car impacts the cost of insurance, with safer cars often qualifying for a range of discounts. Also, maintain the condition of your car by getting it serviced regularly.
Licence to drive
A valid driver’s licence is required to operate a vehicle in Canada. Your foreign driver’s licence may be valid for only a short time (that amount of time varies by province, usually 60 to 90 days), so you will eventually need to get a Canadian licence.
Depending on which country your original licence is from, you may be able to simply exchange your international licence for a Canadian one after taking an eye exam and paying the applicable fees. In other cases, you will have to take the driving exam to requalify. The rules differ for each province. Find out more details at canadianimmigrant.ca under "Settling in Canada" or contact your provincial motor vehicle licensing agency.
® Registered trademarks of the Bank of Nova Scotia. 1 The Scotiabank StartRight Auto Finance Program is available through all Scotiabank authorized dealerships in Canada. This program is only available for Landed Immigrants and Foreign Workers. Subject to Scotiabank financing terms and conditions. Downpayment required.
