Cross Border Shopping – Should We Throw In The Towel?

For those of you who reside close to the US border, and even for those of you who don’t, cross border shopping has probably had a perceived, if not real effect on your sales.  We have no control over the Canadian and US dollar, so do we just throw in the towel and give up?  Read why not.

I consider myself to be a middle class, average consumer that follows the trends to a certain extent and will look for a bargain when I can find one.  So why is it that I never cross border shop?  I am only an hour and a half from Buffalo, I drive, and I certainly have the time to go to the US if I wanted to.  The simple truth is I can’t be bothered with the hassle of crossing the border, fighting traffic, looking for outlet malls and finding accommodation to maximize my allowable duty free claim.

Am I weird or is it really a perception that everyone goes to the US instead of buying in Canada because the dollar is so strong.  Now I am not naive enough to think there is no impact on your sales, but let’s examine some of the facts.  Unless you are willing to get caught at the border, you can only bring back $50 for 24 hours, $400 for 48 hours and $750 for 7 days or more.  That’s not very much merchandise when you talk about Marine or Motorsport products.

What else can affect your cross border shopping decision?

  1. Is the product CSA approved?
  2. Does it meet Canadian Transportation regulations?
  3. You can’t finance cross border purchases
  4. How much did it cost you in gas, food and accommodation to make the purchase?
  5. How much will the duty and taxes be if you have to declare the item/s?
  6. Who is going to fix the product if it breaks down?
  7. What about warranty?
  8. What if you bought the wrong part. Can it be returned and what is the cost?

I have been told that if you don’t licence the unit it is fair game for cross border shoppers.  This would bring to mind ATV’s and Off Road Motorcycles as examples, but then all the other question marks come into play.

Let’s say you need a carburetor for your bike and the cost at your local dealer is $600, but you can get it in Buffalo for $400.  It is going to cost me a tank of gas, restaurants and at least a two night stay if I don’t want to risk being caught at the border.  Even if I go and come back the same day, it has cost me at least $100 for gas and food, not to speak of the time I wasted and the stress of border traffic etc.

An informed consumer is a smart consumer, so make sure you advertise the positives of buying in Canada.  Send out flyers to your customer lists, advertise in your local media, hang signage in your store. In short, put the word out!  I am sure you can come up with many more reasons beyond those I have listed, but make sure your customers know the facts and risks of going south to shop.

In my mind, one of the greatest sacrifices the consumer makes is the loss of building a valuable relationship with their local dealer.  I like and want the whole experience of being known by name and treated with respect, instead of being treated like just another dirty pair of shoes off the street. 

Never underestimate what you as a dealer bring to the table!

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