A Comprehensive Guide to Start Dropshipping in Canada 2022: Everything You Need to Know

In many ways, wholesale is an antiquated business model since it requires considerable overhead, a large amount of storage capacity. While dropshipping, a relatively new but risk-free business model, continues to gain popularity.

Dropshipping is popular for its flexibility. In Canada, millions of Canadian print-on-demand businesses have had great success in using the dropshipping method to create their own unique online stores. Thus, how to start dropshipping in Canada? Let’s explore in the post:

With dropshipping, it keeps the vendors from carrying any inventory themselves to make a profit. In a nutshell, dropshipping aims to solve all of these issues coming from the traditional business model, with lower waste and higher margins.

Here are many great benefits of dropshipping, including:

• Less overhead costs
• Easy business idea testing
• Quick scaling
• Low barrier to entry
• No brick and mortar locations required

Now let’s start your dropshipping journey in Canada by answering those questions: Does dropshipping work and is it legal in Canada?

Does Dropshipping Work and Is It Legal in Canada

The quick answer to the two questions is yes. The fact is online store owners can do dropshipping from everywhere since it doesn’t require you to hold the stock of products you sell.

However, you must follow all policies of an online marketplace, import restrictions, declarations, taxation, and sell allowed Canadian products to dropship in Canada. Thus, e-commerce websites owners need to write Terms and Conditions and Privacy Policies for their websites. In addition, dropshipper should avoid using misleading or false information about the products they sell on their website or online store.

Why Dropship in Canada

Why should you dropship in Canada? Let’s see:

First of all, in 2020, it is estimated that Canadians will spend $49.7 billion on e-commerce in Canada, which indicates its popularity. In addition, most Canadians prefer to buy international than domestic products, dropshipping enables you to resell products worldwide from foreign suppliers such as dropshipping suppliers UK. In other words, you can tap into the global market by starting a dropshipping Canada business.

Moreover, dropshipping allows you to sell goods created and shipped by the manufacturer for you on your behalf, which is a great way to eliminate the cost of inventory and minimize the shipping costs.

Most importantly, with a dropshipping software like DSers, you can easily import products that have low shipping rates (sometimes they’re even free) to your store. It will benefit you a lot. Thus, dropshipping is an ideal business model that allows you to scale your store quickly without increasing the cost burden.

How to Start Canada Dropshipping

Now you have known it is feasible and beneficial to start dropshipping in Canada. Keep reading to learn 5 simple steps to start one.

1. Start a Selling Account or Online Store

You need a selling account or an online store to get started. Once you decide on a place to sell, you need to pick a selling platform, where enables you to build your stores, list your products, receive your payment and communicate with your customers.

These accounts may vary from different platforms. For example, when starting dropshipping on eBay in Canada, you need a selling account on eBay Canada and a business account on PayPal to receive payments. If doing Canada dropshipping on Shopify, you need a Shopify account to create an online store.

However, with a third-party payment gateway, you need to pay extra transaction fees. Here, I have to say Shopify Payment owned by itself is a good option for you to save the cost.

2. Choose a In-Demand or Profitable Product to Sell

The next thing you need to do is to pick the right niche for your business before jumping right into the dropshipping business and getting your first sale. Even though you're passionate about a product, it’s necessary to do the research about it. If it’s too competitive or not suitable to dropship in Canada, you are likely to fail to make a profit..

By analyzing the Canadian e-commerce market and Canadians shopping behavior, there are many popular niches you can learn from( the data all comes from Statista):

• 46% of Canadians purchase clothing/apparel online.
• 35% buy books, movies, music, games.
• 30% buy consumer electronics in online stores.
• 29% of Canadians shop for shoes online.
• 26% of online shoppers buy cosmetics & body care products.
• 21% reach food & drinks online.
• 19% of shoppers get health care products online.
• 17% of Canadian online buyers purchase hobby-related items in online stores.
• 16% of Canadian people order bags and accessories in e0-commerce stores.
• 15% of Canadian buyers purchase DIY, garden, pet products online furniture, household goods, and baby products.
• 13% prefer household products selling online.
• 12% of Canadians get sports and outdoor products online.
• Only 5% order products online from other niches.

As you can see, popular niches for dropshipping in Canada include clothing, apparel, shoes, books, games, cosmetics, body care, and health care products. Thus, if you are planning to dropship in Canada, you can consider these niches.

3. Reach a Trustworthy Supplier

Supplier is a key to your dropshipping business. Whether you find suppliers who ship items within this country or to this country from abroad, one thing you need to attach importance to is always cooperating with reliable suppliers. Dropshipping suppliers store and ship products you sold to your customers. Thus, a trustworthy supplier can contribute to the success of your dropshipping business.

When finding suppliers, you need to take many factors into account, such as price, quality as well as other costs like shipping fee. Aliexpress was launched in 2010 and now is one of the largest Chinese e-commerce companies. If you want to do dropshipping in Canada, AliExpress would be a great option. Here are some reasons:

• AliExpress is reputable enough for people to purchase from it, and the price on it is fixed, then there is no need for you to worry about the pricing rule changes.
• With AliExpress, you can reach out to millions of sellers, who are willing to partner with dropshipping store owners since this partnership is profitable.
• AliExpress offers more than 100 million products in all possible categories with cheaper prices than, for example, on such a giant as Amazon.
• With DSers, the AliExpress official partner, you can place orders to your AliExpress suppliers in a few seconds, then you can spend more time on marketing to boost sales.
• AliExpress is easy to use and you don’t need to pay upfront cost or fee, so you can test out products without a big financial burden.
• What’s more, most of AliExpress sellers has existing products photos and descriptions which you can use on your store.

The benefits of AliExpress dropshipping is more, please check here to know more.

4. Order Samples

When you have decided to work with a supplier, I suggest you to order some samples of the product(s) that you plan to sell from them.

The purpose for doing so is to:

• To confirm the shipping time and take a note
• See how the product package looks
• Test the quality of the actual product by using it yourself
• To ensure the product does what it is intended to do, in other words, to make sure the product can meet the needs of your potential customers

You’d better be sure of the quality of any products you sell. Low-quality products will result in unhappy customers and massive return and refund requests. Thus, testing the products in advance can make your business go more smoothly. Don't let it be a barrier for you to move forward though most suppliers will require a payment for samples.

5. Use a Dropshipping Software

The last but not least thing is to find a dropshipping solution to grow your revenues and boost your business. There are different dropshipping software you can choose from to automate many of your daily tasks and save your time from routine tasks.

Here I recommend the simple but powerful AliExpress dropshipping tool - DSers. Let’s see how DSers can benefit you:

• As I mentioned above, the supplier is one of the key factors of your dropshipping business success. DSers with its Supplier Optimizer lets you select the seller without any hassle. With the most noticeable feature, you can select the right seller for one purchase. Thus, it will not require you to do manual research anymore.
• The next e-commerce feature I would like to mention is to make bulk orders with DSers. As your business grows, there will be huge orders. With DSers, you can place all of them in a click. They will not demotivate you anymore.
• DSers allows you to manage stores from multiple sales channels. You will not need to switch to different platforms to check orders, you can see them with a DSers account. For example, you can integrate DSers with platforms like Wix, Shopify, and WooCommerce.
• DSers will synchronize the tracking numbers of your orders to its dashboard. You can know order fulfillment status and extract other details easily and quickly.

Tax and Shipping Implications

After learning the steps to start a dropshipping in Canada, there is one more thing you need to pay attention to: the tax and shipping implications. If you plan to sell your products to Canadian customers, you may have to charge taxes according to the province where the product is getting shipped.

In summary, Canada has three sales taxes: GST - Federal system of taxation for goods and services, PST - Provincial system of taxation for provincial sales tax, and HST - Harmonized sales tax, which combines GST and PST to make 1 tax. If you want to check the current tax rates by province or territory, go to The Retail Council of Canada’s website.

Although many e-commerce platforms enable you to customize your website and calculate the taxes in the final cost at checkout on your website, there might be other costs that should be concluded in your sales prices such as shipping and customs. Thus, finding out what customs taxes will be applied to your product before you start selling is necessary.

Here, I would like to note: Your supplier will ultimately deliver the product to the customer directly, so take the supplier’s location into account when calculating shipping costs.

Final Word

In a word, the Canadian e-commerce business is growing. The market provides a lot of opportunities to expand online business or to start dropshipping. There are just 5 simple steps to start Canada dropshipping. In addition, Canada is one of the leading countries with a good standard of living, which provides a possibility to increase your store profits by dropshipping the right products there.

Some of the most popular niches for dropshipping in Canada are clothing, apparel, shoes, books, games, cosmetics, body care, and health care products. Thus, if you don’t have a brilliant business idea for yourself right now, you can try them out. However, you also can sell products from other niches so don’t just be stuck in these niches.

I hope you can have a happy journey of Canada dropshipping after reading the post.