By Lee Smith, P.log, B.M., CEO of LSL holding Company.
The Non-Resident importer(NRI) program is an easy way to remove one of the biggest irritants to a Canadian shopper when purchasing goods online. They have one question in mind; “What is my final Landed Cost?"
Typical Canadian story
Almost every Canadian has a story of purchasing an item and having the duties, taxes, shipping and custom surcharges be more than the original item when delivered. A few years ago my son purchased a skateboard shoe online. He got a great deal for $70, but then you added shipping of $30, duties and taxes of $20, and custom fee of $26 for a total of $146. He was very disappointed to see that same shoe in the store a month later on sale for $129. He was one unhappy online shopper. Lesson learned!
Due to no fault of their own this shipper had a very unhappy customer because they were not able to provide him with the final landed cost. Most likely the shipper in the US had no idea what the final price would be to the receiver. That is where becoming a NRI is beneficial to any shipper with deliveries to Canada. You can give your customer the great feeling that this is the final cost and there will be no addition cost at the door when your goods are received.
Who Qualifies as a NRI?
A non-resident importer (NRI) is a company or individual who does not reside in Canada, but elects to act as the Importer of Record (IOR) for a shipment, or shipments, imported into Canada. The IOR is responsible for all accounting related to the importation including, but not limited to, any duties and/or taxes payable to the Government of Canada as well as the maintenance of all records pertaining to each importation.
Business Number
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| From CRA |
If your company is serious about Canada it is recommended that you also apply for a Business Number (BN) at the same time you are becoming a NRI. This allows you to collect the GST/HST (see side bar), and allows you some other taxable benefits such as the ability to claim back for taxes on returns, or for items purchased in Canada.
The benefits
- Provides a seamless offer to the Canadian shopper.
- The final landed to the door price is very clear. No surprises.
- Combined with CLVS (Courier Low Value Shipment) leads to shorter more predictable delivery time.
- Leads to happier Canadian shopper who will shop more.
- Increase your profits
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| NRI= Happy Customer |
Checklist
Get a Business number for Canada.
Register for GST/HST
Work with a professional to update your information to show the fully landed cost to your Canadian consumer.
Disclaimer: There are many options that should be considered before deciding on the best method for clearing the border for your customers. It is best to review with a professional before making any major decision on your supply chain.
Lee Smith is the CEO of LSL Holding Company, a leader in the Supply Chain selection and Courier optimization consulting. Whether you are new to the Canadian Market or looking for ways to improve your existing supply chain to Canada they can help.
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