Navigating Challenges USA and Canadian Business Recovery

With trade agreements with the most major markets in Europe, the United States, and Latin America, as well as a low business tax rate, Canada is an excellent location for establishing operations and expanding worldwide.

It has a strong culture of innovation due to its competitive R&D environment and solid finances

1. Starting a corporation.

Starting a business in Canada takes only a day and a half. The process is quick and simple. All that is required is to file for a corporation and register for VAT.

2. Obtaining building permits, registering the property, and connecting to the electricity grid

It takes an average of 250 days to obtain a construction permit, but the process is lengthy and complicated. There are twelve steps to it. According to the 2024 Canadian Construction Cost Trends study, construction costs are rising at a slower rate than in previous years. This suggests that prices, such as permits, are unlikely to rise as swiftly as they did in 2022 and early 2023. Nonetheless, even with the decreased pace of development, overall building costs are predicted to climb by 2024.

It can take up to fifteen days to complete the four-step property registration process.

It's also difficult to access electricity in Canada. Depending on the state, it takes four to eight weeks and five to seven steps. Energy prices in Canada, particularly in Ontario, have skyrocketed. According to the Ontario Energy Board, energy prices in Ontario increased by 23% between 2020 and 2022, outpacing Canada's average growth rate of 16.4%. To assist residents in Ontario, the government has temporarily reduced the cost of power. The country intends to privatize energy distribution to increase competition and lower Ontario's electricity bills.

3. Jobs: Canada has a low unemployment rate, indicating that the work economy is robust. Nonetheless, several industries, such as manufacturing, healthcare, crafts and construction, and others, continue to face labor shortages. Labor shortages are caused by factors such as an aging population, a lack of skills, pay constraints, and work-life balance issues. This might raise wages and prevent businesses from expanding.

4. The internet.

More and more cyberattacks are targeting Canadian businesses. In 2021, about 20% of them became victims, resulting in losses of over $600 million. Also, personal data breaches are a major issue for Canadians, necessitating stronger data security regulations and increased consumer education.

Canada's reskilling programs, which aim to increase AI abilities, are one way the government prepares its workforce for the future

5. Having to pay taxes

Canada's federal and provincial corporate tax rates are both quite low, at approximately 28% net. For small corporations, the applications procedure takes a few days to a week each year. For more complex cases, it could take weeks or even months. The federal VAT rate is 5%, and some states charge their own VAT rates, while others do not. The provincial and federal VATs do not always match or combine. Some governments do this; others do not. For example, Ontario's total VAT is 13%.

6. Conducting business between countries

There are numerous issues associated with cross-border trade in Canada. These include complex customs and border procedures that can cause delays and costs such as brokerage fees, inspection charges, and so on; logistics and supply chain issues caused by long distances and the country's geography; a lack of infrastructure near borders and a variety of transportation options; and a regulatory environment with changing rules, trade agreements, and non-tariff barriers.

7. Making Promises Stick

Canada's common law system has existed for a long time. It is made up of fair courts that uphold contracts and provide remedies for breaching them. Business contracts are only effective if their terms are explicit and well-written, difficulties are foreseen, and there are mechanisms to resolve disagreements (if they arise). These actions make contracts easier to enforce.

8. Dealing with bankruptcy.

According to recent estimates from the Office of the Superintendent of Bankruptcy, more consumer bankruptcy cases are being filed than there were prior to the epidemic. The number of bankruptcies in Canada increased by 1.8% from March to April 2024. This spike was mostly attributable by a 6.4% increase in bankruptcies. On the other side, bids only increased by 0.4%, which was roughly the same as before.

Stakeholders may learn a lot about the economy and come up with clever solutions to Canada's financial difficulties by looking at insolvency and bankruptcy statistics

9. Getting Credit

In Canada, well-established enterprises with good credit typically have an easier time obtaining financing. New or tiny firms have difficulty obtaining loans because they lack a credit history, meet stringent requirements, or have collateral. However, looking into alternative sources of funding and government programs can assist them overcome these challenges.

10. Core of Culture Fairness, equality, acceptance, and social justice are among Canada's essential values. This is evident in the way the country is administered, with free healthcare for all, higher taxes to assist redistribute income, the legalization of same-sex marriage, the abolition of the death penalty, and the suppression of far-right ideology.

If you want to do business in Quebec, you should know some French. In Canada, English is the business language. Only French may be used on commercial signs in Quebec. In most countries, individuals greet one another with a handshake. However, in Quebec, coworkers or business partners may kiss each other on the cheek instead. Being more than a few minutes late is considered disrespectful by Canadians who value punctuality.