With Quebec being the second-largest market in Canada, any company with a presence in Canada is hard-pressed to overlook what can be a very lucrative market. There is undoubtedly an investment to be made, both in financial and human resources. However, the return on investment can be considerable, given the size of the market and its specific characteristics. Many businesses have found it harder to expand into the US than into Quebec. So it makes a lot of sense to take advantage of opportunities close to home. With retail sales of over $100 billion a year, Quebec’s market is too big to ignore.
Montreal, Québec
1. Recognize and accept Quebec’s differences
North Americans, and perhaps many others native to the English-speaking world, often seem to have difficulty understanding and believing the differences found in Quebec. There is no doubt that we are indeed a ‘distinct society’. This is something the Europeans are much more used to than North Americans.
Quebec’s differences are not simply language, although that’s what people are often most fixated about. But there are also significant differences in the legal structure and culture. Doing your homework in these respects will pay off handsomely over time.
Quebecers are more interested in quality and value than price. They are more interested in a long-term relationship than a short-term deal. What could be more interesting to a business seeking expansion than a market whose very culture is based on loyalty?
2. Deal with language issues
French is Quebec’s official language. Material can be bilingual but the French must be predominant. In a nutshell, that pretty much sums up the language laws. In addition to the legal aspect, the reality is that most people in Quebec are French. A significant proportion of them do not speak English. I am frequently amazed at the unwillingness of English-speakers from other parts to accept this simple fact. I suggest that anyone wishing to enter this rewarding market get over it.
This means that all your documents need to be translated. Consumers and buyers need to have access to French language marketing and sales material. Quebec-based employees need the same for their internal company documents. While this is a largely one-off expense involved in opening up the Quebec market, it is essential for success.
There are benefits to translation as well. For example, if there are four catalogs on their shelf for a given line of goods, three in English and one in French, Quebec buyers will generally reach for the French language one. Quite possibly they may never even look at the English ones. A company that makes the effort to reach Quebec customers in their own language will earn a loyalty that will pay off for many years.
When it comes to packaging, labeling has to be in French. It can also be in English, but descriptions, instructions, warnings and ingredients must be predominantly French. This can often be taken care of with a sticker or package insert. It takes planning but is not as onerous as the media makes it out to be.
Translation should always be done by a professional translation firm, not by machine translation nor by someone who is not a professional translator. The cost of professional translation is relatively minor when compared to the overall investment to expand into the market, yet there is no quicker way to ruin the chances of success than mistranslations.
3. Get quality local representation
Having Quebec-based representation is most likely essential. Marketing strategies that work in Ontario are frequently completely inapplicable in Quebec. Consumers are entirely different here than elsewhere in Canada. A lack of Quebec-based representation and local professional advice is one of the main causes of failure for enterprises attempting to expand into Quebec.
This local representation can often begin with a Regional Manager running a one-man branch office in the province. A local office is best staffed by a good Regional Manager with experience managing and marketing a business in Quebec, preferably in a similar product line, and fluent or native in French. This can provide a business address and presence in the market and will go a long way to building relationships with the market. It will also help avoid being in conflict with local cultural norms such as certain symbols or names.
Having a local office in place for 6 months to a year can provide valuable experience into the market and its aspects. This will really pay off when you are ready to expand your presence in the province.
4. Get appropriate legal and accounting advice
As a civil law jurisdiction Quebec has a considerably different legal structure than the rest of North America. Like many countries in Europe, many legal matters are codified into Quebec’s laws and much less open to interpretation. All legal matters dealing with business and personal relations are set out in the Civil Code of Quebec. This can simplify things in many respects, as the Civil Code stipulates all the principles and remedies. There is much less reliance on case law, which depends on how courts have previously ruled on matters. There are other codes governing labour relations and many areas of professional practice and business conduct. These codes override any contract or agreement you might make that are out of line with them. So it’s important to become familiar with the laws that govern your area of business. A Quebec-based business lawyer will be able to guide you through these requirements as well as provide advice on how to work with them.
Quebec collects its own corporate and sales taxes. So to do business in Quebec you will need to register with Revenu Québec. The department’s website is mostly accessible in English at www.revenuquebec.ca/en/ and the tax agents are helpful and speak English for phone consultation. Quebec’s sales tax (QST), currently 9.975% on the invoice subtotal, is a value-added tax like the federal GST. This means that any purchases or expenses incurred within Quebec generate a refundable QST credit which can be used to offset QST collected on sales.
5. Gain market share
An important but little understood feature of Quebec’s market is that it is somewhat insulated from the rest of North America. This is a major opportunity for those who grasp it and take advantage of the opportunities available. By making the effort to cater to the Quebec market, it may be possible, depending on the business segment, to gain a significant local market share, protected from outside competitors that don’t or can’t make that effort. Many companies have established a solid business base in Quebec, from which they can launch expansion further afield without having to worry excessively about competition in their home turf.
So while the investment and commitment to expand into Quebec is significant, the rewards can be great and well worthwhile.
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