Expanding Existing Business to Canada

Executive Summary

 

This report tackles a survey study of QMX Support Services, Inc. in expanding its business operations in Toronto, Ontario, Canada.  It also presents the necessary factors affecting the business such as Canada's geography, demographics, political structure, culture, business culture, economics, and overall business environment. This report was done in order to take a deeper understanding regarding the operational and organizational processes and issues that take place within QMX Support Services, Inc. and give recommendations for the improvement of the company and its operation. In order to facilitate the author's understanding of the study, research was done regarding the aforementioned aspects of Canada in particular Toronto and the Information and Communications Technology (ICT) sector.

The major findings of this report include the significant facts about the prospective business location and the important characteristics that will affect the whole company's operation. Further, the main recommendations of this report are sub-divided into two interrelated parts: competition and business plan. Competition remains the ultimate consideration in every business expansion. The growth of the company and its services/products offered is dependent on the amount of competition at hand and taking in control of the target market. Thus, market dominance and product superiority is secured. In business planning, it is always imperative to plan and project business management strategies, its implementations and its eventual results. Therefore, QMX Support Services, Inc. is a potential ICT service provider in Canada.

Introduction

 

            Information has always been a critical factor to the success of a business. For this reason, every company in this age must realize the importance of information management and how this will blend with the corporation's business strategies and techniques. One must examine its interaction with the world and economic, political and social issues that influences the business environment. This applies to business organizations that have been long operating as well as to firms and business enthusiasts who are thinking of putting up their own enterprise.

The advances in technology and the fast modernization of the world, in general, opened new and very promising avenues of business abroad. A lot of business-minded individuals from different countries with different nationalities and cultural orientation have and continuously defied the geographic boundaries that exist between continents. This is evident in the growing number of internationally-operating business firms all over the world run by entrepreneurs of varying race and culture. Such is the globalization trend that has plagued the industries as the information man rebelled successfully against intercontinental borders. However, the complexities of the internationalization craze resulted to the downsizing and concentration among small and medium-scale businesses.

The main purpose of this report is to determine and devise recommendations to expand the operations of QMX Support Services, Inc. in Toronto, Ontario, Canada. The essential information that will be gathered through this survey study will serve as the foundational basis for probable construction of recommendations for the company's planned expansion for the next 6-12 months.

 

Company Profile

QMX Support Services, Inc. headquartered in Washington, DC wants to open a site in Toronto, Canada. Currently, QMX works with an extensive array of clients, both public and private and many listed in the Fortune 500, to improve the quality of IT services through the application of established best practices, including the Information Technology Infrastructure Library (ITIL).

The company's mission is to enable IT management excellence by:                        - Researching and documenting best practices through ATLAS;                        - Promoting them through Conferences and Special Events;                        - Delivering them through our Education Services; and                        - Practicing them through our Consulting Services.

 

 

Geography

 

            Canada is a multi-faceted country. It is one of the potentially effective businesses setting because it possesses one of the world's richest markets. Technologically, Canada is highly advanced and can accommodate various developments in the said industry. Canada is the second largest country in the world that consist a variety of landforms and an abundance of diverse natural resources.

           

Total Area: 9,984,670 square kilometer                     Land: 9,093,507 square kilometer                     Water: 891, 163 square kilometer

Capital: Ottawa

Federation of Province: Newfoundland and Labrador, Nova Scotia, New Brunswick, Prince Edward Island, Quebec, Ontario, Manitoba, Saskatchewan, Alberta and British Columbia

Territories: Nunavut, the Northwest Territories, and the Yukon Territory

Largest City: Toronto

Other Important Cities: Montreal, Vancouver, Edmonton, Calgary, Winnipeg, Hamilton and Quebec

Industries: manufacturing, mining (minerals) and services sectors as major ones and agriculture and fishing as supporting industries

Demographics

 

            The following table presents the demographical data of Canada as adapted from The World Factbook 2005 available at CIA webpage.

Population:	32,805,041 (July 2005 est.)
Age structure:	0-14 years: 17.9% (male 3,016,032/female 2,869,244) 15-64 years: 68.9% (male 11,357,425/female 11,244,356) 65 years and over: 13.2% (male 1,842,496/female 2,475,488) (2005 est.)
Median age:	total: 38.54 years male: 37.54 years female: 39.56 years (2005 est.)
Population growth rate:	0.9% (2005 est.)
Birth rate:	10.84 births/1,000 population (2005 est.)
Death rate:	7.73 deaths/1,000 population (2005 est.)
Net migration rate:	5.9 migrant(s)/1,000 population (2005 est.)
Sex ratio:	at birth: 1.05 male(s)/female under 15 years: 1.05 male(s)/female 15-64 years: 1.01 male(s)/female 65 years and over: 0.74 male(s)/female total population: 0.98 male(s)/female (2005 est.)
Nationality:	noun: Canadian(s) adjective: Canadian
Ethnic groups:	British Isles origin 28%, French origin 23%, other European 15%, Amerindian 2%, other, mostly Asian, African, Arab 6%, mixed background 26%
Religions:	Roman Catholic 42.6%, Protestant 23.3% (including United Church 9.5%, Anglican 6.8%, Baptist 2.4%, Lutheran 2%), other Christian 4.4%, Muslim 1.9%, other and unspecified 11.8%, none 16% (2001 census)
Languages:	English (official) 59.3%, French (official) 23.2%, other 17.5%
Literacy:	definition: age 15 and over can read and write total population: 97% (1986 est.) male: NA% female: NA%

Source: The World Factbook. 10 Jan. 2006. <http://www.cia.gov/cia/publications/factbook/geos/ca.html>.

Political Structure

 

            Canada is among the world's established political structure. Generally, Canada is a democratic constitutional monarchy. It is also a federal state that consists of 10 largely self-governing provinces and three territories governed by the central administration. The federal government is in-charge of all the necessary engagements of the whole country ranging from inter-provincial and international trade, national defense, criminal law, banking and monetary systems, and the fisheries.

            Canada is composed of a multi-party democratic system that is replaced by a new government elected within the span of 4-5 years. Today, there are four major political parties existing namely: Liberal; Conservative; Bloc Québécois; and New Democratic Party. The present administration that is ruled by the Conservative party was elected in January 2006 and has a minority government in Parliamentary. The Prime Minister is elected when he/she obtains the most number of elected seats while the cabinet is usually coming from the ruling party.

            In the provinces and territories, they govern their own matters in education, property and the administration of justice, hospitals and municipalities. The municipalities are created under provincial laws and possess the liberty to make by-laws that deals with local issues.

 

Culture

 

In a multicultural setting, such as those of Canada, the customs, beliefs and practices of the native country the company has set up its business in, contributes to the overall development and success of the company. Alvesson states that:

 

"The concept of culture seems to lend itself to very different uses as collectively shared forms of for example, ideas and cognition, as symbols and meanings, as values and ideologies, as rules and norms, as emotions and expressiveness, as the collective unconscious, as behavior patterns, structures and practices, etc. all of which may be made targets to study (p. 3)."

 

Culturally speaking, Canada is a multicultural state. It encourages immigration of different people that contributes to its diversity. As a business environment, the cultural characteristics of this melting pot are necessary in identifying the factors needed in a latent business operation.

 

 

Business Culture

 

Specifically, the information and communication technologies (ICT) industry in Canada is progressive. The percentage of its nationwide utilization ICT services per household covered: over 98% in telephone, 28% in cell phones, and 51% home computer and Internet access. Canada is one of the world's backbones in Internet providing as well as the most technology-savvy and connected countries with a remarkable fastest speed of 40Gbs. For the record, Canada's ICT industry generated a total of $CND125 billion excess of revenue. From 1993 to 2000, the sector achieved a compounded annual growth rate of 9.9% and employment showed development at 5.7%.

Today, Canada has developed a competitive but vibrant ICT industry such as telecommunications, wireless, network and optical technologies, semiconductor design, and software development.

Furthermore, Stephenson identified the key factors in Canadian business opportunity. He states that: "Canada's economic fundamentals and relative cost advantage provide a first-rate business environment. The country provides excellent economic fundamentals, easy access to market, cost-competitive business environment, an excellent place to live in, progressive foreign investment, and supports and promotes innovation."

In particular, Toronto is the country's leading service sector and attracts a growing amount of high-tech businesses. It is also a major tourist center that welcomes the influx of many Arab, Asian, African, and Caribbean immigrants. These people have dramatically diversified the ethnic composition; roughly a tenth of the population is now ethnically Chinese. Furthermore, suburbanization and redevelopment of the downtown and waterfront have changed the city's character.

           

 

Economics of Canada

 

            As a member of G7 group of leading industrial countries, Canada embodies a high standard quality of living, outstanding infrastructure, highly educated and skilled workforce, and reputable and successful trading nation. 

            Canada takes pride of having a strong economy. Historically, it recorded a consistent performance characterized by growth, low inflation, stable unit labour costs, improved cost competitiveness, record exports, and a healthy level of business investment since 1994 up to present.

            In terms of per capita purchasing power, Canada established its place among the G7 countries with most developed economies worldwide. It continues to maintain one of the world's lowest inflation rates. Acknowledge as one of the longest and most stable expansions of the post-war era, Canada recorded the eight consecutive year of economic growth in 1999. The Gross Domestic Product (GDP) reached $949.4 billion (or $31, 054 per capita). Its GDP accelerated to 4.2 percent from 3.1 percent in 1998.

            The Canadian Dollar, as the country's currency, continuously recovered from a historic low of US$0.638 in August 27, 1998 due to the global economic and financial crises. Today, it gains its progressive appreciation among other currencies in the world.

            In the job market, the openness and free flow of trade and investment contributes to the remarkable increase of job creation. In 1999, job growth documented a significant figure of 3.0 percent and considered the highest rate since 1988. On December of the same year, unemployment dropped to 6.8 percent making the lowest level since April of 1976. Today, the job market is increasingly prosper and has not created the onslaught of inflation.

            Specifically, Toronto falls under Ontario who has a diversified economy with potency across a variety of specified sectors. The Ontario economy marked its increased productivity when the slowed economic growth in 2003 (1.3 percent) rebounded to 2.3 percent in 2004. The real GDP is predicted to expand and accelerate from 2.0 percent on 2005 up to 2.8 percent in 2006. Employment in Ontario was 6,316,000 in 2004 with 108,000 jobs produced. Inflation was 1.9 percent in 2004 and forecasted to reach an average of 1.9 percent in 2006 as to compare with 2.1 percent in 2005.

Canada's superpower economy pushes a steady course as it goes onto most modern perspective of prosperity using new paradigms.

 

Overall Business Environment

            Considering Canada as a prospective location for expansion is based on the nation's identity as the lowest costs in the overall business costs by countries. Canada holds the record of lowest costs as to compare with United States and Europe. It is also same as true when it comes to various categories like electricity rates, industrial land and construction costs, and property taxes.

Overall Business Costs by Country
Country	Cost Index
Canada	91.0
U.K.	97.6
Italy	98.7
France	99.1
U.S.	100.0
Germany	113.9
Japan	123.8
US = 100.00 (Average for 12 operations) NOTES: Total business costs in each country are expressed as an index, with the baseline index of 100.0 being assigned to the United States. Countries with a cost index less than 100 have lower costs than the US, while countries with a cost index greater than 100 have higher costs than the US.

Source: Ontario, Canada Official Website. 2006. <http://www.2ontario.com/welcome/codb_308.asp>

Recommendations

 

            Generally, the recommendations are sub-divided into two segments namely: competition and business plan.

 

Competition

 

Competition is an important factor to consider before entering a business. Companies should have successful competitive strategies to be able attract, retain and grow customers. However, before the company can plan and execute these strategies, it should be able to pinpoint its sources of competitive advantage which can be differentiated through products, services, channels, people and image (Kotler & Armstrong 23).

In the case of expanding the business operations, determining what the public has been willing to pay and spend their money with during the previous months such as similar properties offered by other companies is a factor that should be given importance especially in setting the prices of services at stake. The company management and other staff and employees who are hired for their knowledge and skills should have access to information such as comparative market analysis and other comprehensive data with information regarding successful buys and accounts as well as services that were not easily sold. This will provide an array of strategies that the sales representatives can learn from in order to sell the services and products offered by the company. It is important to know everything regarding the target market. Since the success of service sector is largely dependent on the social or people skills of the agents and their knowledge and wit in selling the company's offering, it would be best if competitive people will make up the personnel of the establishment.

Competition is dealt greatly and more seriously in learning about the competitors present in the market who are also willing to give their best in order to take a good share of the market. In Toronto, Ontario, Canada, there are a number of ICT businesses that are operating at present.

For this business enterprise to prosper, the products or services rendered by the company should be differentiated from that of the others. The image of the business firm in particular should be projected in the most pleasing way highlighting its reputation and accountability. This will induce some influence on how the target market will behave towards and perceive the company. Good business deals should be released to the public in order to advertise the company and the services or products on sale. Good business connections for the visibility of the agency among the communities and social gatherings of the target market. The services and properties that the business firm will make available to the prospective buyers should be clearly distinguished and described in the most appealing manner. Efficiency of services as well as in processing the needed papers and other documents should not be a worrisome burden to the clients.

 

Business Plan

In today's global marketplace, intense competitiveness and strong entrepreneurship is viable. Maintaining a good management strategy is crucial. In this study, assessment of modern business strategies of different countries will be elaborated. The diversity of management strategies of one industry will be compared to another to determine the behavior of such company to gain a larger market. Thus, to derive to an accurate analysis, theories and principles will also be included on the study.

Every business is subject to factors that affect the firm's function as a whole.  These factors are the ones attributed for the success or even the failure of a business.  In the light of this, there are certain ways or techniques that can be considered in order to emerge and continue to be competitive within the market place. Establishing a new business requires a number of resources in order to become successful. In addition, a number of internal and external factors must be first considered so as to adapt the establishment to current market and business trends.

It is most important to decide first on the types of products and services that will be offered to the target market. The company should be clear in the type of business transactions it will handle for the clients. Classifications or categorizations of products and services will help enumerate the business transactions that the establishment will make available. This is considered as a start up plan for the owner or head of this kind of business. Through this illumination, the owner or owners of this particular business endeavor will be able to locate and hire the staff and employees for the business to be operational. The business then should be able to construct the internal business structure of the establishment as a business enterprise which will include the delegation of tasks and responsibilities to its team members. This will clarify the responsibilities of the people working in the agency and will enhance efficient and effective business transactions and communication within the business firm.

The company should be likewise sensitive to the finances of the business. The capital or the amount of money that the owner or owners will invest on should be strategically and wisely allocated to the different expenses that the establishment will be confronted with. This will directly influence the type and extent of the products and services that the firm will offer. Exhausting and maximizing the potential of material, social and human resources available will help the business to set it goals. Processing the legality of the business and obtaining the proper documents to start the company should be realized as soon as possible to make it operational.

Marketing strategies should be formulated taking into account the market trends and competition in the industry and locale. It is best to set the agency or company into something that the public, especially the target market, will recognize. Advertising and promotional endeavors will be important in order to gain clients from whom the firm will profit. Historical market analyses, projections and other relevant statistics will be helpful in conceptualizing market strategies that will put the agency in the best light. It is also important for every member of the company to be aggressive when it comes to the stakes of the agency.

External connections or networking will likewise prove beneficial when the agency has started its operations. This will assist and facilitate efficient and lucrative deals from where the agency can benefit from. 

 

Conclusion

 

In general, it is better to understand that businesses and companies are better able to market their products to consumers if they have a good understanding of the consumers and the basic purchase decision process. By understanding the consumer and the type of purchasing behavior associated with different products, public relations managers are more likely to create a campaign that positively impacts the consumer's purchasing decision.

As Stephenson stated Canada is "strong in economic performance", geographically outstanding as business operation, "NAFTA provide easy access to the world's most prosperous market, large stock of skilled workers, low start-up costs, competitive tax system, strong technological environment, positive business climate, superb quality of life", and FDI that doubled since 1990. Thus, these characteristics are considered as advantage to QMX Support Services, Inc. intended operation for the next 6-12 months.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Works Cited

 

Alvesson, Mats. Understanding organizational culture. London: Sage. 2002. p. 3.

 

"Canada." The Columbia Encyclopedia. 6^thed. New York: Columbia University

Press. 2004. p. 8240.

 

 "Canada." The World Factbook. 10 Jan. 2006. CIA Website. 14 Feb. 2006.

<http://www.cia.gov/cia/publications/factbook/geos/ca.html>.

 

"Doing Business with Canada Learn Why, Learn How." Canada International.

2006 Feb. 7. <http://www.canadainternational.gc.ca/dbc/DoingBusinessWithCanada-en.aspx>.

 

Kotler, P. and G. Armstrong. Principles of Marketing, Prentice Hall, London.

2001. p. 23.

 

"Overview of a Robust Economy." 2006. Ontario, Canada Official

Website. 14 Feb. 2006. <http://www.2ontario.com/welcome/codb_308.asp>

 

Stephenson, Rick. Canada: A Business Partner of Choice in the Global

Economy. 14 Feb. 2006 <http://cibs.management.dal.ca/a013-papers/RJS_Dalhousie.pdf>.

 

"Toronto." The Columbia Encyclopedia. 6^thed. New York: Columbia University

Press. 2004. p. 47771.