Why your Canadian customers refuse the package

Every US brand that ships into Canada from a US warehouse has the same support ticket. A customer in Mississauga orders a $50 hoodie. Eight days later a slip shows up on their door. The parcel is at a depot, and the courier wants $42.77 before they hand it over.

Most of that is not duty. It is the courier's brokerage fee for walking the paperwork through customs, plus GST and HST on the item, plus a "disbursement" fee for having paid the tax on your customer's behalf. The customer did not agree to any of it at checkout. So a lot of them refuse the parcel, and it comes back to you. You refund the order and pay the return shipping.

Where the fee actually comes from

When a single parcel crosses the border, someone has to clear it. If you ship DDU (delivered duty unpaid), that someone is the courier, and they charge the recipient for the privilege. The fee is flat, so it stings hardest on cheap orders. Forty dollars on a $50 order. Forty dollars on a $400 order too, but nobody notices that one.

The three ways out

1. Prepay at checkout (DDP). Your checkout collects duties and taxes and you pay the courier's clearance fee yourself. It works, but you are still shipping from the US, so delivery is still 6 to 10 days and you still pay a per-parcel clearance charge.
2. Bake it into the price. Some brands just raise Canadian prices and ship DDP quietly. Honest, simple, and your conversion still suffers from the delivery time.
3. Hold stock in Canada. One pallet crosses the border as a commercial shipment. Duty and GST are paid once, on the wholesale value, on one invoice. From then on every order is a domestic Canadian shipment. No brokerage, no notice on the door, and 1 to 3 day delivery because the parcel starts in Ontario.

Option three is what Polar does. It is not magic. It is the same thing every Canadian retailer already does, and it is available to you the moment your stock is on a shelf in Hamilton.

What to check before you move stock

• Do you have Canadian demand already? If 8 to 15 percent of your traffic is Canadian and your Canadian conversion rate is half your US rate, the door is the problem.
• Can you start small? One pallet, your top 20 SKUs. Measure sell-through for 90 days before you send more.
• Who is the importer of record? We can be, if you do not have a Canadian business number. Ask.

If you want to see the math on your own numbers, the rate calculator on our pricing page runs the same math we quote with.