June 2017 | Sponsored | Thought Leaders

U.S./Canada Trade Remains Strong, With Plenty of Opportunity for Growth

Tags: Retail, Legislation, Public Policy, and Regulations, Cross-border Trade, E-commerce, Canada

John Costanzo is President, Purolator International, 888-511-4811

Q: What trends are you seeing in U.S./Canada cross-border trade?

A: I see tremendous opportunity on both sides of the border. For one thing, imports from Canada are growing, largely due to the stable U.S. dollar. We seem to have turned the tide on the currency volatility of the past couple years, allowing Canadian manufacturers to again look to the United States as a stable source of profit and growth. Among U.S. businesses, confidence is at an eight-year high, as evidenced by investments in manufacturing and hiring.

On the regulatory front, the two countries have made progress in eliminating many of the bottlenecks and redundancies that have jammed the customs process. The joint Single Window Initiative is a great example of the enhanced cooperation. While some degree of NAFTA recalibration does appear likely, I have to believe there will be minimal effect overall on U.S./Canada trade. With more than $1.5 billion in goods crossing the border each day, I am very bullish on trade opportunities.

Q: What about the potential for U.S. retailers to tap into the Canadian e-commerce market?

A: Canadian e-commerce is growing at a double-digit pace, with Amazon, Apple, and eBay leading the way. Similar to U.S. consumers, Canadians turn to e-commerce for value and selection. And since, until recently, Canadian retailers were behind in meeting those needs, consumers have looked to U.S. retailers, with more than 9 million Canadians purchasing from U.S. sites last year.

However, U.S. businesses must go the extra mile to ensure "Amazon-like" flexibility and delivery guarantees. This means making sure your transportation provider understands the nuances of the Canadian market and factoring their unique end delivery options for consumers. Among other things, consumers highly prefer to receive shipments with all duties and taxes paid. A logistics partner must be able to access all of Canada and meet strict transit time requirements, and, of course, process returns. Canadian consumers have a strong affinity for U.S. brands, and when handled correctly, e-commerce can be a great opportunity for U.S. retailers.

Q: What about trends here in the United States?

A: Technology has changed everything, and today it is possible to achieve transportation efficiencies that were unthinkable just a few years ago. Amazon was among the first to recognize the power of logistics innovation, and today its "free" 2-day delivery model has reverberated across all supply chains—B2B and B2C—as businesses adapt to changing customer expectations.

One of the biggest changes has been the emergence of expedited services as a "normal" logistics solution, rather than an option reserved only for the most fragile or most critical shipments. Expedited service, with its premium level of customer service and delivery guarantees, has become the preferred option for many businesses unwilling to risk a late or damaged delivery. And, as U.S. manufacturers continue to invest in technology-driven automation, expedited service is the logical choice for ensuring fast, flawless service.

Looking ahead, we'll see demand for even more innovative options, including evening and Sunday deliveries, with increased focus on last-mile attention to detail. Delivery flexibility and service have become integral parts of the customer experience, and businesses will increasingly turn to their logistics provider for the "next big thing" in helping to differentiate themselves. I also expect to see more focus on inventory efficiencies and distribution center location.






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