This is not only unfortunate for our economy, but frustrating for Canadians who want to buy from Canadian merchants. And most do want to. Not necessarily out of patriotism, but to avoid the hassles of getting merchandise across the border.
Canadian customers are eager to buy
Canadians are buying online. By 2015,
online spending in Canada is expected to nearly double, reaching CAD $30.9 billion,
according to eMarketer. Yet Google estimates
that as many as 1.2 million Canadian businesses do not even have a website!
By
2010 over half of Canadian Internet users were already placing orders online,
according to Statistics Canada, and the percentage doing so continues to
increase. Despite the evident desire to buy from Canadian companies, 60% of respondents said that at least some of their online orders were with
merchants and service providers in the United States, and a further 18% ordered
from companies located in other countries. What a wasted opportunity for
Canada!
So why aren't more Canadian companies selling online?
The answers, I believe, vary by size of company.
- The big retailers are still struggling to figure out how to do e-retail right. Witness, for example, HBC, which never really made a commitment to e-commerce, despite the fact that with its Canada-wide retail network, shipping and in-store pickup would be a no-brainer.
- Mid-sized companies suffer from a lack of conviction that e-commerce could work for them. They can't compete with prices of the big boys, so how can they compete? (I'll answer that question in a subsequent post. It can be done.) At the same time, they are big enough that to sell online they would need to invest fairly heavily in e-commerce related software and services to provide the range of products and level of service that their customers would expect.
- Small companies are overwhelmed by time pressures, confusion, and cash flow crises. It is not obvious who they can turn to for help with their web presence. Many got started with the kid next door who put up a little site for them while he was in high school. These sites typically look awful and are totally ineffective for boosting sales. The owners (a) don't have the money to redo the site, (b) don't have the know-how, (c) don't have the time, and (d) because the first site was so useless, they don't have the belief that a serious online presence could be profitable.
Are a greater proportion of US companies online?
I suspect that among large retailers, they are. The US has a much more competitive retail landscape than we have in Canada. E-retail sales have been growing much faster than store sales, so they've seen clear benefit to getting in the game.What I'm wondering about is small and mid-sized businesses? In absolute numbers, of course more of them are online. But as a % of businesses in their size? I don't know. I haven't been able to find any data on that.

