In my time with Invest Buffalo Niagara, I’ve had a chance to help 32+ Canadian companies make their way to this side of the border. Along with being part of helping the Buffalo Niagara region boom—to the tune of $706 million in investments and more than 1,600 jobs—I’ve also seen the pitfalls that Canadian business owners need to look out for. For the first in this two-part series, we’ll focus on the beginnings of due diligence: the questions you need to ask yourself when you’re looking to enter the US market.
Here are the questions companies looking to cross the border need to be able to answer before making the move:
- What will the ownership structure be for the US operation?
- Will Canadian employees need to work out of the US facility? If so, will they need work visas?
- Are there Canadian patents in play that need to be protected in the US?
Tax and Accounting considerations:
- Will your US and Canadian operations be legally connected (and do know the pros and cons of each method)?
- How will money be transferred back to the Canadian corporation?
- How will your company avoid double taxation?
Human resources considerations:
- What kind of labor pool can you expect?
- What is the pay scale for workers in the area?
They’re not easy answers—but companies that take the time to consider these questions up front will find they help them yield a long-term vision. Skipping this part of the process can result in messy hang-ups down the line—from missing out on key incentives to facing legal battles related to employment.
Interested in more? Look out for part 2, where we’ll delve into steps that will help you tackle the due diligence process.