Many experts in the field thought that the pandemic would be the death of e-commerce in America.
Simply put, importing overseas products became even more difficult. With lockdowns limiting work productivity across the globe, and stringent checks required to confirm the safety of overseas products, things were looking dire.
But, as always, we found a way — and it was with Canadian Fulfillment.
The Trade War
Prior to the pandemic, the long-lasting trade war between the US and China provided a somewhat unexpected (and rather beneficial) windfall for Canada — a rise in products being imported into Canada from China, instead of into the USA.
See, back in 2016 there were several unique tariffs imposed by the Trump administration that made it considerably more expensive for US businesses to import products from China.
As I am sure you can imagine, these tariffs caused the death of numerous American based e-commerce businesses across the nation.
However, with the stress placed on the US economy by the pandemic, and the change in administration during this period, many companies hoped that these duties and tariffs would be removed in their entirety.
However, despite the desperation of online businesses across the US, they were upheld by the Biden administration,
Canadian Fulfillment Operations
But, as I alluded to above, there is a solution.
There is a little-known shipping clause that allows certain goods to enter the US under a specific classification known as “Section 321”. In short, any imported good that gains this classification can enter the country completely tax and duty free,
And how does one gain this classification?
Well, these tariffs can be avoided by first importing any overseas goods into Canada. These large orders can then be broken down into individual orders valued at 800 USD or less and shipped off to individual customers.
It is for this reason that online e-commerce platforms like Amazon have actually seen an increase in business since the pandemic — because more US businesses have realized just how effective using Section 321 and Canadian Fulfillment can be.
Using Section 321 through Canadian Fulfillment
Now, I know what you are thinking — “how does this work?”
And it is easier than you think.
Over the last five years we have seen a large increase in the number of “Canadian Fulfillment” companies entering the market. These Canadian-based companies offer a service where they receive your overseas shipments into Canada, store them on your behalf, and then ship them to your individual customers when you receive an order.
And in doing so, they allow every single one of your shipments to gain Section 321 classification, completely eliminating import costs.
Accelerating Trends in Ecommerce
And thanks to Canadian Fulfillment, rather than seeing a decline when the pandemic started last year, the already booming e-commerce landscape saw unprecedented growth.
People significantly changed their shopping habits, and even with the end of the pandemic in sight, many of those new behaviors and habits have become the norm. In short, the growth of e-commerce is here to stay.
And importantly, the rise of online shopping has been a boon for order fulfillment companies.
Using Canadian fulfillment has not only provided US based e-commerce businesses with a way to reduce their import costs, but they have also improved running costs and global efficiency, and others are starting to take note.
Getting aid from Canadian fulfillment allows you to save money on warehouse space, warehouse staff, and shipping. Moreover, the reduced amount of time spent on packing and shipping orders can be spent on other things that contribute to business growth.
And this is before we consider the huge benefits observed by the Canadian economy associated with this powerful business model. With the increase in Canadian Fulfillment comes increased demands for freight, staff, and corporate tax, all of which leads to country wide economic growth.
In short, Canadian Fulfillment is here to stay — and you better get on board.