CanAm Council Meeting Looks at Operationalizing a Cross-Border Business and the Importance of Understanding your Market.
By: Blair Severn, CanAm Council Executive in Residence and Chairman of Enabling Ideas
It is elementary. If you want to make the grade in a cross-border business, you have to do the homework.
That is the key takeaway from the CanAm Council’s November meeting featuring the third presentation in a 3-part series on cross-border business know-how.
A panel of experts discussed “Operationalizing Across the Border”, covering the many details any company must pay attention to in establishing a bi-national business. Panelists included Jennifer Behm of Berardi Immigration Law, Rosanna Masucci of United States Dept. of Commerce, Alan Rosenhoch of Invest Buffalo Niagara and Linda Soltis of Consulate General of Canada in New York.
The unanimous message from all the experts was ‘do your homework first’. Not to just be better planned and prepared but to prevent all too common costly mistakes.
A Few Important Tips from the Experts
- There are major differences in human resource/labor laws that must be considered in your employment plan.
- There are differences in tax laws, regulations and tax rates such that it is prudent to get expert advice on determining an appropriate business structure.
- Although governments of both Canada and the U.S. have incentive programs to help companies investing in setting up in the country, they are accessed and work differently.
- There are decisions you need to consider, even before approaching experts for help, including:
- Do you know your market…where, size?
- Are you exporting or will you be setting up a physical presence?
- Are you moving people from your country or are you hiring from the other country?
- Common assumptions that get companies in trouble include:
- The market is just like in our country
- Management can simply run the business from our home country at a distance
- We have good credit so we can get financing just like in our home country.
A Few Opportunities from the Experts
- Canada has a well-educated workforce of diverse origin where 44% of Canadians have an undergraduate degree and 51% of the Toronto area is foreign born.
- Canada has an attractive federal corporate tax rate of 15%.
- WNY has excellent accessibility to the greater U.S. markets.
- WNY is highly advantaged as compared to other market areas with relatively low labor costs, real estate, industrial power rates.
The CanAm Council would like to thank our panelists for their informative presentation on cross-border operations.