Best 5 Reasons To Consider Business Expansion in Canada

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As globalization continues to transform the world economy, businesses looking to expand their operations need to consider new markets that can provide long-term growth and stability. One such market is Canada. With a highly developed and stable economy, business expansion in Canada has become an attractive destination for businesses looking to expand their operations globally.

In this article, we will provide an in-depth analysis of the Canadian economy and explore five compelling reasons why businesses should consider expanding to Canada. From its favorable tax regime to its highly skilled workforce and world-class infrastructure, Canada offers a range of benefits that make it an ideal location for businesses looking to access the North American market.

Whether you are a small business owner or a multinational corporation, expanding your operations to Canada can be a game-changer for your business. So, if you are looking to take your business to the next level, read on to discover why business expansion in Canada should be at the top of your list of potential expansion destinations.

Top Industries In Canada

Service Industry

The service industry in Canada accounts for a whopping 80% of the country’s GDP and employs nearly three-quarters of the workforce. Retail, business, education, and health care industries provide for the majority of the sector’s revenue.


The manufacturing industry in Canada is involved in the transformation of materials or substances into new products, either physically or chemically. These items could be final goods for human consumption or semi-finished goods for use in manufacturing operations.

Mining, Quarrying, And Oil And Gas Extraction

The extraction of naturally occurring minerals is the primary focus of Canada’s mining, quarrying, and oil and gas extraction industries. Oil and gas extraction dominates the business, while other mining activities include coal mining and the extraction of a variety of metals such as gold, silver, copper, nickel, and others.

Real Estate, Rental, And Leasing

The real estate, rental, and leasing industry in Canada is made up of businesses that do things like real estate management, selling, renting, or buying real estate for others, appraising real estate, renting and leasing tangible assets like automobiles, and leasing nonfinancial intangible assets like copyrighted works.

business expansion in Canada

5 Reasons To Consider A Business Expansion In Canada

1. International Trade Networks 

One of the top reasons to consider business expansion in Canada is the country’s extensive international trade networks. Canada is the only G7 country that offers investors preferential market access to over 1.5 billion consumers in 51 countries. With a Toronto address, your business will be located in the epicenter of the financial and political sectors of North America, giving you quick and easy access to major cities and regions such as New York, Chicago, Boston, and Washington D.C.

But it’s not just about proximity – Canada has also established international trade agreements that make it an attractive location for businesses looking to expand globally. The North American Free Trade Agreement (NAFTA) and the Comprehensive Economic Trade Agreement (CETA) between Canada and the European Union are just a few examples. These agreements provide Canadian businesses with preferential access to markets across the United States, Mexico, and the European Union. By expanding your business to Canada, you can take advantage of these agreements and gain access to a potential market of over a billion consumers.

Furthermore, business expansion in Canada is a good idea as the country that values international trade and has a long history of promoting it. The government of Canada has established organizations such as Export Development Canada (EDC) and the Canadian Trade Commissioner Service (TCS) to support businesses looking to expand internationally. The TCS has offices in over 160 cities worldwide, including in major global markets such as China, Japan, and the United Kingdom. These organizations can help you navigate the complexities of international trade, connect you with potential partners and customers, and provide valuable market intelligence.

2. Canada’s Stable Economy 

Another reason to consider business expansion in Canada is because its economy is one of the largest and most sophisticated in the world, with an annual GDP of $1.64 trillion in current USD in 2020, ranking it as the ninth-largest economy globally. Despite the impact of the Omicron coronavirus strain and protests that shut down key border crossings, the Canadian economy finished 2021 on a strong footing, with a 6.7% growth rate in the fourth quarter, exceeding analysts’ expectations. Although the global recovery will continue in 2022, it will be at a lower rate due to slower rebound since the reopening of countries.

Canadian households are expected to play a crucial role in the country’s economic recovery in 2022. They have saved money during the pandemic, providing them with a cushion to withstand inflation. However, as constraints on the services sectors gradually loosen, their consumption habits are projected to revert to normal. The outlook for the Canadian economy in 2022 remains positive, with GDP expected to return to pre-pandemic levels in the first few months of the year, although some factors that led to the slowdown in the second half of 2021 may weigh more heavily on the recovery.

Canada’s stable economy is one of the many compelling reasons why businesses should consider expanding to Canada. The country has experienced steady economic growth since 2005, even weathering the 2008 global financial crisis without a major recession. One of the factors contributing to Canada’s economic stability is the early intervention by the Bank of Canada and its conservative lending practices. These measures helped mitigate the impact of the financial crisis on the Canadian economy and prevented a significant recession.

Despite the challenges posed by the Covid-19 pandemic, Canada’s economy has shown signs of resilience and growth in 2021, with current projections indicating that this trend will continue in 2022. This stability is supported by a business-friendly environment that encourages investment and entrepreneurship. The country’s tax rates are competitive compared to other G7 countries, and the government offers incentives such as the Strategic Innovation Fund and the Scientific Research and Experimental Development Tax Incentive Program to attract foreign investment. With low risk and a growing economy, Canada represents a promising opportunity for businesses looking to expand globally.

3. Highly Skilled Workforce 

Yet another reason to consider business expansion in Canada is that it has a highly skilled workforce, which is supported by the country’s prestigious universities and vocational training institutes. The Organization for Economic Co-operation and Development (OECD) notes that 62% of 25-34-year-olds in Canada have a secondary education, which is the second-highest rate globally. This reflects the country’s commitment to education and its investment in developing a skilled workforce.

Moreover, Canada’s friendly immigration policies have made it an attractive destination for foreign-born individuals seeking employment. In fact, the number of employable foreign-born individuals above the age of 18 with a university degree in Canada is the highest in the world at 65%, according to a report by the Canadian Bureau for International Education. This means that foreign business owners who are looking to hire in Canada will have access to a vast pool of talented and competent candidates, who can bring valuable skills and experience to their organizations.

Canada also has a reputation for producing graduates with practical skills that are highly relevant to the needs of the modern business world. Many Canadian universities and vocational training institutes have a strong focus on practical training and applied research, which prepares graduates for real-world scenarios and helps them to develop the skills needed to succeed in their chosen careers. As a result, Canadian graduates are highly sought after by businesses around the world, and the country has a strong reputation for producing high-quality talent across a range of industries.

4. Competitive Corporate Income Tax Rates 

Expanding a business into a new market can be costly, and high corporate income tax rates in the home country can make the situation even more challenging. Fortunately, Canada has one of the lowest corporate income tax rates in the world, making it an attractive destination for foreign investors. The Canadian government regularly reevaluates the corporate tax rate, making trade conditions more flexible for companies.

According to the latest data from KPMG’s 2021 Competitive Alternatives study, Canada’s overall tax costs are among the lowest in the G7 countries and are significantly lower than those of the United States. In addition, Canada’s federal corporate income tax rate is only 15%, and combined with provincial corporate income tax rates, it can range from 12% to 31%, depending on the province or territory. These rates are much lower than those of many other developed countries.

Foreign investors looking to set up their businesses in Canada can expect to benefit from the country’s competitive corporate tax rates. Moreover, the Canadian government is committed to ensuring a favorable business environment by regularly evaluating the tax system and making changes as necessary. In fact, the Canadian government has announced plans to decrease corporate tax rates even further in the future, which will further improve Canada’s attractiveness as a destination for foreign investment.

Expanding into Canada’s business-friendly environment can provide significant benefits for foreign investors, including access to a large and diverse market, a highly skilled workforce, and competitive tax rates. The Canadian government’s commitment to improving the country’s business environment further makes it an attractive destination for foreign businesses seeking to expand their operations.

5. Canada’s Social Familiarity To USA 

Canada and the USA share many similarities in business culture, making it easier for local business owners to migrate north. In addition, Canada’s proximity to the United States means that Canadian businesses can benefit from close collaboration and partnerships with American companies.

Canadian demographics are also similar to American demographics in terms of religion and ethnicity. Both countries speak English, but French is also spoken in Canada, especially in Quebec. This means that American business owners who may not be fluent in French can still comfortably navigate the country without significant language barriers.

In terms of business etiquette, Canadian dress codes tend to be very conservative. Canadians are mindful of the weather and dress appropriately for it. In addition, punctuality in the workplace is highly valued, particularly in meetings. For an informal social event, it is acceptable to be up to fifteen minutes late, but no later than thirty minutes.

Canadians also appreciate eye contact and feel more comfortable talking to individuals when they can look them in the eyes. Personal space may differ, as French Canadians tend to stand closer than two feet from each other. However, overall, the Canadian business culture is generally polite, respectful, and welcoming.

For American businesses that already have offices in the USA, adjusting to Canadian business culture will be relatively straightforward compared to other Western countries. With its close proximity to the USA, similar demographics, and a shared language, expanding a business to Canada can be an excellent opportunity for American business owners looking to grow their companies.


In this article, we have discussed the various reasons why Canada is a great location to expand your business. Canada has a thriving economy with low tax rates, a highly skilled workforce, and access to the North American market. Additionally, the Canadian government provides incentives for foreign businesses to invest in the country, making it an attractive destination for business owners looking to expand their operations.

We have identified five key reasons why expanding your business to Canada is a smart choice. Firstly, Canada’s strategic location gives you access to the North American market, which is the largest in the world. Secondly, the country’s stable political climate and low risk environment provide a sense of security for business owners. Thirdly, Canada’s highly skilled workforce is well-educated and multicultural, making it an ideal location for businesses requiring a diverse range of skills. Fourthly, Canada’s competitive tax rates and government incentives make it an attractive destination for businesses looking to invest in research and development. Finally, Canada’s excellent quality of life and social benefits ensure that your employees are well taken care of, leading to increased job satisfaction and productivity.

At NNRoad, we are committed to helping businesses expand into Canada. We provide a range of services including employment solutions, payroll, and mandatory contributions administration. Our Employer of Record solution in Canada makes it easy and fast for businesses to hire employees and start their expansion in the country. If you are interested in expanding your business to Canada, please contact us today for more information on how we can help you succeed.

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