How to Start a Dropshipping Business in Canada: Tips for Success

Starting a dropshipping business in Canada offers many opportunities for aspiring entrepreneurs. With a digitally connected population, a rapidly growing ecommerce sector, and access to reliable shipping networks, Canada has become one of the best locations for dropshipping success. 

But how exactly do you get started in the Canadian market, and what are the best practices to ensure long-term success?

In this guide, we’ll walk you through the essential steps to start your dropshipping business in Canada, along with tips on how to navigate its dynamic ecommerce landscape.

Why dropshipping in Canada is a smart choice

Before diving into the step-by-step guide, let’s discuss why Canada is such an attractive market for dropshipping.

A digitally savvy population

Canada boasts a population of over 38 million people, with a high internet penetration rate of over 93%. Out of these internet users, more than 21 million are active ecommerce shoppers, making it an incredibly fertile ground for online businesses. Whether you’re targeting young tech enthusiasts or eco-conscious consumers, the vast potential customer base in Canada is hard to ignore.

Rapidly growing ecommerce market

Canada’s ecommerce market is projected to hit $65.5 billion by 2024 and is expected to grow to a staggering $104 billion by 2029. This growth is driven by consumers who value the convenience of online shopping and are willing to spend on high-quality products, which makes dropshipping a highly viable business model.

Geographic advantage

Canada’s proximity to the US, one of the largest ecommerce markets in the world, provides a unique advantage for cross-border sales. Many major online stores in Canada are headquartered in the US, in fact, in 2023, six of ten of the leading online stores in Canada were headquartered in the United States. This allows you to tap into a broader customer base without any extra effort. Reliable courier services such as Canada Post, UPS, and FedEx also ensure that deliveries are fast and efficient.

Now that we’ve established why Canada is an excellent market for dropshipping, let’s get into how you can get started and ensure your business succeeds.

Step-by-step guide to start dropshipping in Canada

1. Register your dropshipping business

The first step to starting your dropshipping business in Canada is registering your company and ensuring you comply with all relevant laws, including taxes and consumer protection regulations.

How to get started:

• Choose a business structure: Decide whether you’ll register as a sole proprietorship, partnership, or corporation. We recommend going for a corporation as this is quite similar to an LLC in the USA. Here’s more about each of these business structures.
• Register your business: This step involves getting a business name, domain name, and logo. Be sure to register your business with the Canada Revenue Agency (CRA) to obtain your Business Number (BN).
• Tax considerations: Familiarize yourself with tax laws, including Goods and Services Tax (GST) and Harmonized Sales Tax (HST), as well as international tax regulations if you plan to sell outside of Canada.

2. Set up your online store

Once your business is registered, the next step is to set up your online store. In Canada, Shopify is a top choice for ecommerce platforms, with over 31% of online retailers using it. Shopify’s intuitive interface, vast customization options, and seamless integration with dropshipping apps make it ideal for beginners.

Steps to set up your store:

• Choose a platform: While Shopify is the most popular, other platforms like WooCommerce or BigCommerce are also great options.
• Design your store: Use a clean, professional theme that reflects your brand’s identity. Ensure your site is mobile-responsive, as mobile shopping is increasingly popular in Canada.
• Optimize for SEO: Implement basic SEO strategies from the start, including optimizing product titles, descriptions, and meta tags.

Read more: How to Create a Brand Identity in Dropshipping

3. Choose your payment methods

In Canada, the most common online payment methods include credit and debit cards. Additionally, PayPal is the most widely used payment gateway. Make sure your store offers a variety of payment options to accommodate different customer preferences.

Tips for choosing payment methods:

• Integrate PayPal: PayPal is trusted and widely used by Canadian shoppers, so integrating it is a must.
• Offer local payment options: Interac e-Transfer is a popular option for Canadian consumers, and integrating this feature can increase your chances of converting local buyers.

4. Pick the right products for dropshipping

Success in dropshipping relies heavily on choosing the right products to sell. In Canada, popular ecommerce categories include fashion, such as clothing and shoes, electronics, and home items.

Trending dropshipping products in Canada:

• Winter apparel and accessories: Given Canada’s cold climate, items like jackets, gloves, scarves, and thermal wear are consistently in demand.
• Tech gadgets: Canadians love tech. Products like wireless earbuds, smart home devices, and portable chargers are popular and provide high-profit margins.
• Eco-friendly products: As sustainability becomes a priority for many Canadians, products like reusable water bottles, bamboo utensils, and biodegradable bags are gaining popularity.

Read more: 10 Best Trending Products to Dropship in 2024

5. Find reliable domestic suppliers

Finding reliable suppliers is crucial for ensuring that your customers receive high-quality products on time. Many dropshippers choose to source from platforms like AppScenic, which connects you with top-rated suppliers that offer fast shipping and competitive pricing.

How to choose suppliers:

• Source locally: By choosing suppliers based in Canada, you can minimize shipping times and reduce the risk of import taxes or customs delays.
• Test products: Order product samples to evaluate quality before listing them in your store.
• Use dropshipping platforms: AppScenic offers access to over 12,000 products from Canadian suppliers and automates inventory updates, making it easier to manage your store.

Read more: How to Identify a Reliable Supplier for Your Dropshipping Niche

6. Market your products

Once your store is up and running, it’s time to market your products and drive traffic to your website. Social media is a powerful tool in Canada, with over 94.37% of the population active on platforms like Facebook, Instagram, and TikTok.

Tips for effective marketing:

• Leverage social media: Use platforms like Instagram and TikTok to promote your products. Paid advertising on Facebook and Instagram is particularly effective for ecommerce businesses.
• Run Google Ads: If you’re looking for targeted traffic, Google Ads allows you to reach people searching for the products you sell.
• Implement advanced SEO tactics: Use easy-to-apply advanced SEO strategies that can give significant results for your dropshipping website, such as targeting long-tail keywords and creating high-quality, engaging content.
• Use email marketing: Build an email list and send regular newsletters to engage with potential customers and encourage repeat purchases. Here’s an extensive guide to email marketing for dropshipping newbies.

Now, why dropshipping in Canada is best with AppScenic?

While dropshipping in Canada offers great potential, partnering with the right platform can make all the difference. AppScenic, our smart AI dropshipping platform, provides a game-changing solution for Canadian dropshippers, offering key advantages that simplify operations and improve customer satisfaction.

Benefits of using AppScenic:

• Wide network of suppliers: We connect you with reliable suppliers based in Canada, ensuring fast shipping times and high-quality products.
• Automation: AppScenic automates order processing, inventory updates, and product pricing, so you can focus on growing your business.
• 24/7 support: Running a business comes with challenges, but AppScenic’s dedicated support team is available 24/7 to help resolve any issues quickly.

Ready to start your dropshipping journey in Canada?

Now, starting a dropshipping business in Canada offers endless potential, but only if it’s done correctly. By following these six steps, registering your business, setting up your store, choosing the right products, finding reliable suppliers, and marketing effectively, you can set yourself up for long-term success.

The Canadian market is ripe with opportunity, and with the right strategy, you can build a thriving dropshipping business that serves customers across the country.