Good news came for would-be Canadian exporters on January 5, 2016 when the Government of Canada announced its new CanExport program. This 5-year, $50-million program is intended to bolster the competitiveness of small and medium-sized Canadian companies on the world stage by providing direct financial assistance to businesses seeking new markets and exporting opportunities. As novel as this direct financial incentive for Canadian entrepreneurs may seem, it shouldn’t. Small and medium-sized businesses represent the backbone of the Canadian economy, accounting for 99% of all Canadian businesses. Considering also the Canadian manufacturing and exporting landscape, it’s about time business owners that have been eyeing foreign markets got a helping hand. A lack (or not enough) of export grants frequently cited by Canadian businesses as a hindrance to exporting. The CanExport Program is intended to help overcome the financing barrier and get local business into global markets.
Who can use this grant?
A company is eligible for support from this program as long as it is a for-profit, incorporated legal entity OR limited liability partnership, has between 1 and 250 full-time employees, and declares an annual revenue between $200,000 and $50 million in Canada. All business sectors are eligible for this grant except companies specializing in agriculture, food, beverages, fish, and alcohol that may apply for export support through Agriculture and Agri-Food Canada’s AgriMarketing Program. In short, this program covers a wide swath of small to medium Canadian businesses seeking to export products and services oversees that had been left out of programs offered to exporters of food and agricultural goods. The CanExport grant can be applied to export and marketing activities in any country as long as there are no economic sanctions that apply to your proposed activities in that country. Applicants can only apply for a single new market (ie. one country) to which they have not exported in the last 24 months. However, the application can include multiple activities for a single market. This is where you will find that the list of costs covered by the program is quite comprehensive. Activities eligible for coverage by the CanExport Program include: business travel to target markets, participation at trade fairs and trade missions, adaptation of marketing tools, and market research.
How much is on the table?
CanExport program contributions range from $10,000 to $99,999 per project with the maximum annual CanExport contribution per applicant set at $99,999 per government fiscal year, which begins on April 1 of each year and ends on March 31 of the following year. The total contribution by the CanExport Program is determined on a cost-sharing basis and covers up to 50% of eligible expenses. Firms may apply for and receive funding from other sources, but the total level of government assistance (i.e., federal, provincial, territorial and municipal) cannot exceed 50% of the total eligible expenses for the same activities or projects. Thus, if your goal was to spend $40,000 on finally breaking into the international arena this year but find yourself coming up short of funds, CanExport give you up to $20,000 and make that goal a reality.
CanExport recipients can only have one active project at any given time and will only be able to reapply once their current CanExport activities have been conducted and all claims have been processed. However, applicants can apply for multi-year funding, each year reapplying for the CanExport Program. This means Canadian exporters could receive as much as $99,999 covering 50% of their exporting and international marketing activities each government fiscal year.
What I liked most
Contributions from CanExport are non-repayable and need only be matched by the applicant business. Being non-repayable takes a lot of pressure off of the Canadian entrepreneur and allows them to save that money to reinvest in their growing business. Further, what small business owner needs to worry about interest and repayment of another loan? None, of course, and CanExport saves you the worry. I was also impressed with the long list of expenses that CanExport can cover, all of which are critical to a business’s exporting success. Covered expenses include: travel for up to two employees, accommodations and meals, trade fair registration and booth fees, the cost of hiring a translator, and designing, printing, and adapting marketing tools in another language. All of which add up to a considerable amount for the small to medium-sized company seeking to break through into international export markets.
“You miss 100% of the shots you don’t take.” —Wayne Gretzky
Succinct but true. You can’t win if you don’t try, and you can’t be a household name unless you get out there and introduce yourself (and your product!).
Try CanExport, the world is waiting for you….
ConnexFund specializes in grants and funding for innovative companies and start-ups with focus on technology and manufacturing. Many Canadian businesses are aware that there is some free money available for them. But not so many know where to find it, how to access it and how to prepare a grant application that is successful. And this is exactly what ConnexFund does!