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Why Am I Losing Money When Shipping To Canada?

Frustrations arising from cross-border shipping to Canada are always showing up in my Google Alerts. Most are from online auction type sellers who really do not understand the customs clearance process. Some try to save the customer's money by placing a false value on the goods which can result in even more costs for false declaration and lengthier delays for the receiver in Canada. Some e-sellers refuse to ship to Canada altogether as they feel it is too much hassle and have lost money in  the transaction or received bad feedback from buyers.

Have You Been Faced With This Situation?

1. Why do my customers in Canada want me to ship USPS?

This could be because it is cheaper to do so.

2. When I ship via postal service why does my customer in Canada send me a message four weeks later informing me they did not receive the package and I should resend it?

It could be because there is no traceability and it might be lost or stolen.

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3. When I ship using a small parcel courier why do they hold my package hostage until the customer pays all the customs charges? Often the customer refuses to pay and the parcel company ships the package back and charges me for it.

Using the small parcel courier now provides you with the ability to track your package, but does your customer in Canada know what to expect to pay in  extra customs charges when the goods are delivered? If they don't they may feel the charges are too high and it is no longer worth buying the product.

4. When I ship using the "other" small parcel company, why do they bill me all kinds of customs charges but the customer still gets their package?

The small parcel courier is on a customs program called the Low Value Shipment Courier program (LVS), in which the courier is allowed to declare and deliver the package and then that small parcel company sends out a letter stating how much they owe in duty, taxes and brokerage. If the Canadian customer does not respond, the "other" small parcel courier's service guide directs them to bill the charges back to the shipper for any unpaid customs charges.

"Regardless of any payment instructions to the contrary, the sender is ultimately responsible for payment of duties and taxes if payment is not received."

5. Why is my business losing so much money when selling to Canadians?

See 2, 3, and 4 above.

Have You Explored All Your Options When Shipping And Selling To Customers In Canada?

Before you ship or sell your products to customers in Canada, do your homework and consider calling a Canadian customs broker who can assist you in:

  • understanding the complexities of the cross-border transaction
  • save you money in fees
  • avoid unnecessary hassles at the border and with angry Canadian customers
  • streamline your shipments for a speedy delivery and a less costly transaction

The Non-Resident Importer option may be one solution. Preparing your Canadian customer on what to expect and having a solution in place may be another. Contact us before you finalize your next sale, and we will work with you and your Canadian customer to help both of you make a smooth cross-border transaction.

Your how to guide on Non-Resident Importing
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About Author
Gloria Terhaar
CCS, CTCS, CBSA Professional Designate

Gloria Terhaar has over 17 years of Canadian customs brokerage experience. She currently works in our Canadian division as a Trade Compliance Supervisor and Regulatory Compliance Specialist. Gloria has extensive experience in all aspects of documentation and regulatory requirements as they relate to importing products into Canada. Gloria is often called upon to train industry with some recent talks for MNP, the Surrey Board of Trade, TFO Canada and the BC Produce Marketing Association. In 2018, Gloria also participated in the Canadian Produce Marketing Association and the Canadian Horticultural Council advocacy event "Fall Harvest" in Ottawa where she participated in advocacy efforts for the Canadain produce industry.

While we strive for accuracy in all our communications, as the Importer of Record it is incumbent upon your company to ensure that you are aware of the requirements under the new regulations so that you maintain compliance as always.