Welcome to 2016 where all you need is a laptop, some coffee, and wifi to have a successful online business- for passive or primary income reason. Before we get started I just want to give a shoutout to Shopify Guides for the knowledge:
The first thing to consider, is not the product, the branding, but the legality. The rules stated below are a guideline for Canadian legislation.
Whether you’re starting a brand new business or you’re an established retailer, taking your business online is a fantastic and exciting growth opportunity. In fact, there has never been a better time to start an ecommerce business. The internet has connected the world and tools like Shopify now make it possible for anyone to get started, regardless of technical skill.
However, with all of these advantages come some complex legal issues. Different countries have different laws and knowing which ones apply to you is critical. In addition to the large variety of laws to take into account, you must remember that the law is fluid and subject to change. In order to reap the rewards that a successful online store can bring, you must stay informed and protect yourself and your business.
We want to make you aware of all the important implications that come with conducting business online so you can prepare yourself and carry out all the necessary steps to ensure everything you’re doing meets the legal requirements for an online business operating in Canada.
Having said that, this guide is not meant to be taken as official legal advice. Rather, it’s simply meant to point you in the right direction and it’s always best to seek professional legal counsel if you have questions about your specific situation.
Word, design, or combination of both that is used to identify the goods and services of one person from those of another person.
—S.2 Trade–marks Act
In the competitive and constantly changing digital marketplace, a trademark is a very valuable asset. It differentiates your business and the quality of your products from those of your competitors. Your trademark carries your reputation with it, and reinforces long-term relationships with your buyers.
It’s important to be aware of trademarks not only to protect your rights, but also to ensure that you’re not infringing on the rights of others when creating one. The Canadian Intellectual Property Office (CIPO) is responsible for registering and enforcing your rights as a mark holder. They’re a resource you can access to gather information, ask questions, check the registry of current marks and begin the registration process. The Trademarks Act is the federal legislation that broadly defines which marks can be protected by law, as well as outlining your rights as a trademark holder and how to enforce them.
Types of Marks
(i) Ordinary Mark — Words, designs or a combination of both.
(ii) Certification Mark — Used by an organization and given to others to identify that their goods meet a certain standard.
(iii) Distinguishing Guise — The shape of goods or the containers that distinguish them.
Before registering your mark formally with CIPO, there are some factors to consider. First, check CIPO registry to make sure your mark is unique. This increases your chances of being approved. CIPO also advises that you hire a trademark agent. These lawyers are authorized to represent you throughout the process, which can be complex. An agent is the best way to protect your rights, especially if your mark is opposed.
There’s no legal requirement for you to register your trademark but there are benefits for your brand if you do. Registering your mark gives you the exclusive right to use it in Canada. In the event that someone does use your mark, it’s easier for you to take legal action because the registration is enough proof that you own the mark. An unregistered mark holder can only enforce their rights on the basis of “passing off,” which is difficult and expensive to prove. A trademark is an asset to your business that is worth protecting, and registering your mark is the best way to do that.
(i) Property — can be sold/licensed.
(ii) Give the holder exclusive rights.
(iii) Deters others from using it.
(iv) Proof of ownership.
(i) Using your mark for extended time can provide rights.
(ii) More difficult and expensive to bring legal action.
Always remember that the law is fluid and subject to change. Although trademarks are an established area of the law, be sure to stay informed about the changes relevant to you and your business. CIPO is a good resource for keeping up to date and ensuring that your rights are maintained.
You cannot send commercial messages (CEMs) by email, text message, social media or any other electronic form without consent.
As a shop owner, you often have the opportunity to collect and use your customers’ e-mail addresses. This can be a valuable resource to increase sales, but be sure to exercise caution when using this information. The Canadian government has addressed these privacy issues by passing Canadian Anti- Spam Legislation (CASL), which came into effect on July 1st, 2014. The act preserves the value of commercial messaging while minimizing the costs and inconveniences of spam. You should take this law seriously because the offense of “spamming” is broad and the penalties are high. It’s up to you as a business owner to prove you’re in compliance.
A commercial electronic message is a message sent electronically that encourages people to participate in some form of commercial activity.
Sending e-mails to customers is a great way to keep them informed about your products and offers. These sorts of communications are defined as “commercial electronic messages,” or CEMs for short. Potentially problematic messages range from emails telling customers about a new sale to offering unsolicited business opportunities.
The law in Canada doesn’t ban these messages, but it does require that you (the sender) provide certain features, information and gain the recipient’s consent. These ensure that the recipient knows exactly who you are and that they can stop the messages from coming if they’re no longer interested.
(i) Who is sending the message.
(ii) A way to contact this person.
(iii) An unsubscribe mechanism.
If an issue arises under CASL, it’s your responsibility as the business owner to prove you had consent. This means you must have systems in place to store the permission you’re given. When obtaining consent, you must clearly and simply identify the purpose of the messages that the consumer is agreeing to receive. Also be sure to include your contact information and a short statement explaining that they can unsubscribe at any time. There are a variety of ways to get the required consent.
(i) Based on permission, or “opt-in”.
(ii) Sender must prove consent.
(iii) Systems should be in place to keep that consent on record.
Providing a check box accompanied with the required information listed above is an efficient way to gather permission from visitors to your site. This box must be unchecked in its default state so that the consumer actively chooses to solicit the information. When there’s an existing business relationship between the sender and receiver of the CEM, expressed consent may not be required — although it’s always smart to gain consent and record it in case of any challenges. The Canadian Radio-Television and Telecommunications Commission (CRTC) has releasedregulations and bulletins providing advice and clarification on how to comply with the new law. These bulletins, as well as the government website, can help you stay up to date. Complying with this law will allow you to maximize your contact list as a means of marketing, while ensuring that your communications are legal.
(i) Age, name, income, ethnic origin.
(ii) Opinion, comments, social status.
(iii) Existence of a dispute between consumer and merchant.
Whether you conduct business online or offline, you have access to people’s personal information. Privacy is important to them, but it’s becoming harder to protect in an increasingly digital marketplace. The Personal Information Protection and Electronic Documents Act (PIPEDA) provides rules for how to collect, use and disclose this information.
Privacy laws in Canada seek to create a balance between your need to collect personal information and an individual’s right to maintain their personal privacy.
(i) You need consent to collect, use or disclose personal information.
(ii) When using information, you must only do so for the purpose to which the individual has consented.
(iii) Regardless of consent, you have to limit the collection, use and disclosure of information to what “a reasonable person would consider appropriate in the circumstances.”
(iv) Individuals must have the ability to access the information they have provided and make changes or correct mistakes.
As a business held accountable by the law, you should organize a “privacy plan” to assure your customers that their information is responsibly managed. PIPEDA states that you as the business owner are responsible for your privacy decisions. You’re required to protect the information you access.
(i) What will be collected?
(ii) How will it be used?
(iii) How will it be stored?
(iv) What security measures are in place to protect the information?
(v) How long is information kept?
(vi) Will the information be shared?
(vii) How can they get in touch?
The Office of the Privacy Commissioner is an excellent and interactive resource to help you comply with important federal privacy law. In addition to clearly labeled information, there are interactive quizzes that provide tailored assessments and plans for your business. As an online shop owner, you should stay informed and use the resources provided to you by the Privacy Commissioner so that the information you receive is secure and used appropriately. Respecting personal information can help build a strong and competitive foundation to your customer relations.
(i) Sole Proprietorship
Whether you’re just starting out or deciding on the right structure for your existing company, understanding the law around business organization is important. You’ll have to assess the nature of your business to figure out which option will afford you the most benefits.
This is the most common structure for online storeowners, and also the easiest to run and set up. Although you need to have the correct permits and register the business in your province, no separate entity is created. Your assets as a business owner and those of the company are one and the same. Taxes that the business owes will appear on your personal tax return. Your company can evolve beyond a sole proprietorship in the future if need be, but this is a simple and low–cost way to start out and operate your online shop.
(i) Easy to set up and run.
(ii) Tax relief available if
business is not doing well.
(iii) Control of all business
decisions and profits.
(i) If business is doing well, you could be put in a higher tax bracket.
(ii) Not a separate business entity.
(iii) You are responsible for all debts or actions against the company.
A partnership is another common structure for small businesses. These are formed when two or more individuals are co-owners of a business venture. This structure allows individuals to pool their assets and skills to increase their chances of success.
With this form of organization, remember to focus on the human element. There’s always a chance that a friendly partnership can change in the future. For this reason, make sure to have a lawyer assist you when drawing up a partnership agreement. Selecting the right partner is important because you’re liable for the debts and actions that they incur on behalf of the business.
(i) Allows for a division of work, capital and profits.
(i) Not a separate entity.
(ii) Both partners are liable for the actions of the other in the business.
The incorporation process is more complicated and costly, but does have many potential benefits for your online business. One of the most notable differences about this business structure is that the corporation becomes a separate entity from you as the owner. You’re not personally financially liable for what happens to the corporation. There are also very beneficial tax incentives for this type of organization. Based on the nature of your business, you can choose to incorporate federally or provincially. Click here to get further information about federal incorporation, as well as your province’s processes and rules.
(i) Separate entity.
(ii) Limits your financial liability.
(iii) The corporation survives the death of shareholders or sale.
(iv) Tax advantages.
(v) Improves your credibility.
(i) Heavily regulated.
(ii) Requires extensive
(iii) More expensive to form
(there are fees associated with incorporation).
4 Steps to Incorporation
Name your business — Even if you’ve been operating under a business name for some time, be sure to check the registry to ensure no one else is using that name.
Get a business number — This number will identify your business to the government. Click here to register your number.
Decide whether to incorporate federally or provincially — Provincial incorporation is sufficient for most online storeowners. This process is less expensive and easier to navigate than the federal option. A federal corporation allows you to do business under the same name in all provinces, but it’s more complicated so be sure to seek the advice of a lawyer when completing this step.
Register for GST/HST account — If your company makes more than $30,000 a year, you must register for a GST/HST account with the government. Even though it isn’t mandatory if you make less than the set amount, it’s beneficial to register for the account either way.
Choosing a Business Structure
It’s important to consider the unique aspects of your business when deciding which organizational structure to choose. Although some options have benefits on paper, they may not be a worthwhile choice for you. There are detailed and helpful resources available from the Government of Canada (Canada Business Network). The checklists, information and planning strategies can help you make the best choice for your business. Before finalizing your decision, consult a lawyer to make sure you’ve made a sound choice and that the process is completed properly.
So now that you are legal, how do you find that product to sell?
Let’s first look at the all eight opportunity types, then, we will dive into each one in more detail:
- Uncover Opportunities in Keywords
- Build an Interesting and Captivating Brand
- Identify and Solve a Customer Pain Point
- Identify and Cater to Consumer Passions
- Follow Your Own Passion
- Look for an Opportunity Gap
- Utilize Your Own Experience and Expertise
- Capitalize on Trends Early
From there you can look at these sources:
1. Start with What You Have or Solve Your Own Problems
Before you begin searching the depths of the internet and the ends of the earth for product and niche ideas, it’s always best to start with the ideas that you already have. If you’re like most entrepreneurs, you likely already have a few ideas for products you want to sell or have thought about selling in the past. Maybe it’s an idea you’ve had for years or maybe you have a problem in your own life that there is no good solution for currently.
Here are a few questions to consider when making your list:
- What products, niches or industries are you particularly passionate about or interested in?
- What products, niches or industries are your friends passionate about?
- What pain points or frustrating experience do you have in your own life?
Example: Max Valverde made the decision to solve one of his own problems he faced each morning; unruly, messy hair. For most guys, bed head can only be fixed by washing your hair, but this takes a lot of time each morning so Max created a product to solve this. Morning Headis a shower cap with an absorbent towel liner that you can soak with water, place on your head and rub around for a minute to get your hair ready for styling.
2. Local Community
The idea for your perfect product to sell online might be closer than you think. Traditional brick-and-mortar businesses have been around much longer than their ecommerce counterparts. Paying attention to trends locally in brick-and-mortar retail just might help spark product ideas you can take online. Try spending an afternoon taking a look around your community and note what new or interesting retail concepts and products are on display.
Another great source of product inspiration within your community can come from your local newspapers which tend to feature new, innovative and local concepts and products. As you look at these resources, ask yourself if they can be turned into an online opportunity.
Example: Yummy Tummy Soup Company saw an opportunity to take a traditional brick and mortar concept and make it an online concept. The Yummy Tummy Soup Company sends out healthy homemade soups, cakes and pastries in a thoughtful care package. They cook and bake all products daily and send them coast to coast in temperature controlled containers.
3. Online Consumer Trend Publications
What better place to find a interesting products to sell online than from publications who’s job it is to curate new, interesting and trending product ideas. Following trend publications is great way to begin getting a sense of the direction consumer products are going and the ideas other entrepreneurs are introducing to the market. Following these publications can also expose you to new product categories and industries that you previously didn’t know about.
As a start point, take a look at the following popular online trend publications:
Trend Watching – Trend Watching is an independent trend firm that scans the globe for the most promising consumer trends and insights. Trend Watching has a team of thirty professionals in locations like London, New York, Singapore, Sydney and Lagos all looking for and reporting on worldwide trends.
Trend Hunter – Trend Hunter is the world’s largest, most popular trend community. Fuelled by a global network of 137,000 members and 3,000,000 fans, Trend Hunter is a source of inspiration for aspiring entrepreneurs on the hunt for new product ideas.
Jeremy, the founder of Trend Hunter says, “Like many of us, I was an entrepreneur at heart, but I didn’t know what idea I wanted to pursue. I chose careers that I thought would lead me to my business idea… but after years of searching, I was still hunting for inspiration. It was then that I started Trend Hunter – a place for insatiably curious people to share ideas and get inspired.”
Springwise – There are millions of business ideas spanning the globe that operate in a specific way, have their own style, and market in a unique fashion. It’s not always possible to travel the world searching for these ideas to bring home though. That’s where Springwise comes in. Springwise travels the world for you, on the search for new entrepreneurial ideas, trends, and stories. Springwise publishes a daily and a weekly newsletter, which you can subscribe to for free.
Example: Dan, the founder of Inkkas shoes is a great example of someone that took a trend from another country and brought it to North America. Inkkas are beautiful, unique shoes designed using authentic South American textiles. The idea came about when Dan noticed the trend for this style of shoes in Peru. After deciding that this was a great product that would also do well in the North American market, he brought the idea home and successful funded a Kickstarter project, raising over $77,000 in pre-orders for his shoes.
4. Industry Leaders
You may not know what product to sell, but maybe you know the industry or market you would like to be in. Using various online tools, you can discover and follow the influencers in the industry you’re interested in. Following the right people on social media can help uncover and inspire new ideas from a constant stream of carefully curated content from the people that are in the know.
There are several great online tools you can use to discover the influencers online for a particular industry or market:
5. Consumer Product Review Blogs
Product review and discovery sites can also be a fantastic source of ideas and inspiration. Sites like Uncrate (men’s products) and Outblush (women’s products) are great ways to see new curated product trends daily. What better way to get inspired than to get a daily glimpse into the new and interesting products other entrepreneurs are bringing to the market.
Here are just a few examples of popular consumer product blogs to get you started:
Don’t limit yourself to just looking at the big and popular product blogs but explore niche reviews sites as well. Consider what types of products and niches you’re particularly interested in and follow product review blogs in those niches.
6. Social Curation Sites
Social curation sites like Pinterest can be a goldmine for product and niche ideas. Many of the images contain interesting, new and trending consumer products. Using the built in social signals you can sometimes get a sense almost immediately of their popularity. This could be your first clue if there is a market for the product.
Several of the larger social curations sites to check out include:
- Pinterest – Pinterest is one of the fastest growing social network with over 50 million monthly users. Make sure to check out the popular section for what’s currently trending.
- Polyvore – Polyvore is another great service, similar to Pinterest. Polyvore’s global community has created over 80 million collage-like “sets” that are shared across the web.
- Fancy – Fancy describes themselves as part store, magazine and wish list. Regardless of what it is, it’s filled with product ideas for you to explore.
- Wanelo – Wanelo (Want – Need – Love) describes itself as a community for all of the worlds shopping, bringing together products and stores in a Pinterest like product posting format. You can start by checkout out trending people.
7. Business-To-Business (B2B) Wholesale Marketplaces
What better way to get product ideas than right from the source. This has been a popular option amongst ecommerce entrepreneurs for a while and this list wouldn’t be complete without it. Wholesale and manufacturer sourcing sites like Alibaba exposes you to thousands of potential product ideas. It can be easy to get overwhelmed with the sheer amount of product available so take your time.
Some of the more popular B2B wholesale product sites are:
- Alibaba – You’ve likely heard of Alibaba. They are the biggest ecommerce company in the world, even larger than Amazon and eBay combined. Alibaba connects consumers all over the world with wholesalers and manufacturers (typically) from Asia. With hundreds of thousands of products, there’s not much you can’t find on Alibaba.
Although it’s generally accepted that Alibaba is the largest online wholesale and manufacturer database, there are many other sites similar to Alibaba you can use for inspiration and to find product ideas.
Some of the largest competitors of Alibaba include you should also spend some time exploring include:
8. Online Consumer Marketplaces
Another rich source for product ideas are online consumer marketplaces. Millions of products is probably an understatement so you may want to begin your search with some of the popular and trending items and branch out into other interesting categories that catch your eye from there:
eBay – eBay is the largest online consumer auction site.
eBay Popular – A list of some of the most popular product categories on eBay.
eBay Watch Count – An online tool that will list the most popular items on eBay based on how many people are “watching” them.
Amazon – Amazon is the largest internet retailer.
Amazon Bestsellers – Amazon’s most popular products based on sales. Updated hourly.
Amazon Movers and Shakers – Amazon’s biggest gainers in sales rank over the past 24 hours. Updated hourly.
Kickstarter – Kickstarter is the largest crowd-funding website.
Kickstarter Discover – Browse all projects by popularity, funding, staff picks, as well as many other options.
Etsy – Etsy is a marketplace for handmade items.
Etsy Trending Items – Check out the current trending items and listings on Etsy.
AliExpress – AliExpress is a new consumer wholesale marketplace from Alibaba that allows you to order in small quantities.
AliExpress Popular – The most popular products being bought on AliExpress.
9. Social Forum Communities
Reddit is the largest social media news aggregator. It describes itself as the front page of the internet and is enormously influential. Reddit has thousands of “subreddits” which are sub-sections or niches that cater to different topics and and areas of interest. It’s within these subreddits that you can find lots of inspiration for product ideas.
If you have an idea for a particular industry, niche or product category, it’s worth doing a search and finding a suitable subreddit community to join and actively become a part of.
There are also many product focused subreddits that are packed with ideas.
Here are a few examples:
- Buy It For Life – For practical, durable and quality made products that are built to last.
- Shut Up And Take My Money – Interesting, clever, useful products that that people want… badly.
There are also several subreddits for curated Amazon products, make sure to check out the following:
- The Best of Amazon
- The Best of Amazon Canada
- The Best of Amazon UK
- Cheap Stuff on Amazon
- Find It On Amazon
If you’re active on Reddit and pay close attention, occasionally you have come across interesting posts like these:
- Reddit, What is One Product Under $20 That You Recommend Everyone To Buy?
- What $100 Item Has The Single Greatest Ability to Increase Quality of Life?
No matter which approach you take, Reddit is has been and continues to be a rich and valuable source of entrepreneurial ideas and inspiration, coupled with a supportive community.
Instagram isn’t just pictures of food and puppies, it’s also a great option for discovering new product ideas. Because it’s photo based, it makes it easy to scan through many ideas and photos quickly.
There are a few ways you can use Instagram to search for product and niche ideas:
- Hashtags – Once again, if you have a particular interest in a product category or industry, you can try searching for applicable hashtags and following relevant people in the market/niche or industry. Another great option is to do a search on Instagram for applicable hashtags that insinuate buyer interest and intent like #want and #buy.
- Product Curation Accounts – There are many accounts on Instagram that post curated product content. Like many other examples above, you’ll likely want to search for and find accounts within the niches you are particularly interested in. As an example, Shopify curates interesting and unique products from Shopify’s 90,000+ online stores. It might just provide the idea or spark for your next product.
With all these resources you should be able to start generating a pretty healthy list of initial products ideas to begin exploring further. In the next chapter, we’re going to look through all of the resources ourselves and share some interesting product ideas with you.
Once again shoutout to Shopify Guides for these insights. This is not my work but rather curated post of Shopify content brought to you by yours truly.
**This blog is not all original content- I do not own all the content. The purpose of this blog is to collect valuable insights across various channels, publications, and articles, and present them in a digestible and current way. Some material has been copied, and referenced in some articles, and should not be treated as original work.