An Insider’s Look at Importing

Dave Smith is a Business Analyst with Triple R Community Futures (in Morris, MB). Prior to joining Triple R, Dave worked as an import broker. In my quest to demystify importing for entrepreneurs, I tapped Dave’s brain and am sharing with you his thoughts on what entrepreneurs need to know.

 What are the most important things entrepreneurs need to know about importing?

Dave: Do your research. Know if the products you are planning to import are admissible into Canada. Do the products require approval by any agencies such as CFIA, Health Canada, etc? Find out if they are duty-free.

What are some ways to do that research?

Dave: Communicate with the manufacturer of the products. Just because you are importing them from the U.S. does not mean that they were actually manufactured in the U.S. Find out where the products were made.

Also, find out what the product/product components are made from. What materials went into the making of that product? For example, a vehicle is not just metal, it has rubber tires, leather seats, etc. It is not enough to know the product as a whole, you also need to know the materials of all the components of the product. And don’t forget to find out what packaging and shipping materials will be used. Sometimes, it’s not the product itself but the packaging materials that can cause a problem.

Can an entrepreneur import without using a broker?

Dave: Yes. An entrepreneur who wants to do the importing herself needs to be prepared to do all the required paperwork as well as all the research on import requirements. It can be a labour-intensive job that requires a lot of research on rules and regulations, but an entrepreneur could do it herself.

Why hire a broker?

Dave: To save yourself time and reduce stress. You hire a broker because they know the rules and regulations, and they will do the necessary research. You will count on them to do the right paperwork and file the documentation within the appropriate timeframe. They will know if other agencies will be required for inspections, etc. The benefit of using a broker is so that the entrepreneur can save time and reduce stress by ensuring things are done properly, eliminating any problems and hold-ups at the border.

What advice do you have for an entrepreneur who is looking for a broker?

Dave: It can be helpful if:

  • Your broker is in the same city/location as you are so that you can develop a relationship with them.
  • You find a broker who specializes in the types of products you want to import. Find out what the brokerage firm specializes in. You also want a brokerage firm you can trust. Ask the transportation company you plan to use or other importers for referrals. Their good (or bad) experiences can help you find the brokerage firm that is right for your needs.

Finding out what it costs to utilize a broker is not easy. How are brokerage fees generally determined?

Dave: Brokerage fees are usually based on how much you are importing, how often and what you are importing. The fees will also be impacted by GST and duties because the brokerage firm usually has to cover those fees.

What do brokers need to know?

Dave: The same things the entrepreneur needs to know so the more information you can provide to your broker the smoother the process will be for everyone. They will need to know:

  • Country of Origin – where the product/product components are from; where the product/product components were manufactured.
  • Materials of product and product components: What are all the materials that are in the product, including the packaging materials?
  • Government Controls: Does the product need be inspected by a government agency before it can cross into Canada?

Final words of advice?

Dave: At the end of the day, the entrepreneur, as the importer, is responsible for making full and accurate declarations. Customs can audit any company’s import activities going back as far as seven years, so keep your papers organized. Know the above information on the products you plan to import regardless of whether you use a broker or do it yourself. If you hire a broker, provide them with as much information as you can. The more research you do ahead of time the better.

Dave Smith worked for many years as a Customs Broker bringing in any all types of goods via all modes of transportation. His most memorable import: A 1944 P51 Mustang. Dave is now a Business Analyst with Community Futures Triple R, located in Morris, Manitoba. He travels throughout southeast Manitoba providing advice and assistance to rural entrepreneurs.

Nancy Brommell is a business advisor at the Women’s Enterprise Centre of Manitoba. She is certified assessor for WEConnect International and WBE Canada and has had the privilege of accompanying many Manitoba women business owners on export trade missions. Have a question on importing or exporting? Call Nancy.

Written by Nancy Brommell, Business Advisor, Women’s Enterprise Centre of Manitoba