May 24, 2021
Exporting Overseas: Selling Goods to North America (USA & Canada)
By: Peter Gregory
Want to start exporting your goods to the USA & Canada? This is the beginner’s guide for you!
Together, the USA and Canada form the largest English-speaking market on Planet Earth. In this article, we’ll cover some of the customs rules and cultural differences that UK businesses need to be aware of if they want to move into this lucrative market.
The greatest thing about North America is the number of people there! The USA’s population, alone, is about five times the size of the UK’s … and Canada is home to 38 million people, around 57% of the UK population. The majority of both countries speak fluent English and value high-quality British-made goods. There are important differences between the UK and North America, however.
To sell UK-made goods to the USA and Canada, you need a strong understanding of customs and export rules. You also have to be aware of the different labelling systems used in North America. It also helps if you have a strong understanding of the structural differences between fashion retail in the UK, the USA and Canada. You can hire experts to help you with everything from customs to logistics and distribution, but the more you know about the exporting process before you start, the better.
The USA is by far the biggest trading partner of the UK, accounting for 20.8% of our total exports. When we add Canada’s stats, to the USA figures, we find that in 2020 alone, almost one quarter of the UK’s total global exports (goods and services) went to North America (see the full ONS data here).
North America is a massive market for UK exporters, but it’s not actually the biggest. The 27 member states of the EU accounted for a whopping 42.1% of our total exports (goods & services) in 2020.
We haven’t been ‘out of the EU’ for a full 12 months yet, so we may find that these percentages change dramatically in 2021. For now there’s no denying that, after Europe, North America is the next stop for most British clothing brands.
Whenever you’re selling to a new country (or countries), you need to think carefully about the cultural differences you’re likely to face. The USA and Canada are no different.
At first glance, the UK and USA have very similar online shopping habits. Roughly the same number of online transactions, per-person, take place in both countries. There are big differences in how the US shops for fashion, however. Womens clothing accounts for a much smaller slice of the overall ecommerce ‘pie’ in the States, and Amazon has a much larger share of the clothing market overall. Dr Stephen Kraus, a world-leading consumer behaviour expert, has produced a really interesting report on the differences between the two markets, which you can read here.
You might not think you need to worry about language when selling to North American consumers. Everyone speaks English, but you should still consider multilingual packaging and wash care labels.
If you’re already selling your clothes in Europe, then chances are you’ve already tackled the language issue. After all, France and Spain are the UK’s 5th and 10th biggest export markets respectively. Just make sure that you don’t assume a simpler label is ‘better’ for North America!
Beyond the language issue, there’s something else you need to consider when labelling clothes for sale in America.
Wash care symbols are totally different across the pond! Our Ultimate Guide to Wash Care Labels explains every dot and dash in detail. For now all you need to know is that it’s not the same as the UK. It’s your job to cater for both standards. You can either add a separate line to your existing wash care labels, or you can attach a totally different label for products bound for Canadian and US export — the choice is yours.
Sizes are different in North America, too. There’s no strict standard that all clothing manufacturers follow, but generally speaking a size 10 item in the USA or Canada will fit like a UK size 12. Shoe sizes are even more complicated. A men’s size 10 shoe in the UK will be a size 10.5 in America, but a women’s size 5 in the UK will be a size 7 in America. You can address this with multiple sizing notes on your clothing labels, or you can offer a series of online tables and guides. All that matters is that you make it as easy as possible for your consumer.
For a time, there was some doubt about whether British clothing businesses would be able to export to Canada post-Brexit. Our trade deal with Canada was originally through the EU, which created a lot of uncertainty last year.
Thankfully, Canada and the UK came up with a workable short-term ‘handshake deal’ (Memorandum of Understanding). This deal basically kept tariffs and export procedures as-is in the days following Brexit. A more formal trade deal then came into effect on 1 April 2021 (full details of the UK-Canada Trade Continuity Agreement here). UK and Canadian businesses can now trade with each other without fear of a sudden change in the rulebook.
There are still quotas in place for clothing and textiles imported/exported between Canada and the UK. A full list of these quotas can be found in the TCA document itself (page 23). In essence, quotas haven’t been a problem for clothing exports between the UK and Canada — we rarely ‘hit the limit’ of our textile and fashion quotas. There’s no real risk of being blocked from selling to Canada because of trade quotas. It’s far more likely that goods could get seized due to incorrect customs declarations, so make sure you get help in this area if it’s your first time exporting.
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If you visit The ‘Check Duties’ tool on gov.uk you can get almost everything you need to export to either Canada or the USA. Everything — from complex customs questions to standards of manufacture — is listed in one simple place. It’s a brilliant service!
As always, if you have any questions, we’ll do our very best to help you. We’ve exported labels to the US and Canada in the past, but the customs rules change depend on what it is that you’re exporting, so you may still need to get professional customs advice.
Thanks for reading!