Newcomer's
Guide to Starting a
Business in Ontario
How to Find Business Ideas, Research the Market, Prepare a Business Plan, Calculate How Much Start-up Money is Needed, Locate Financing and Begin Operations
Published March 2016
How This Book Will Help Newcomers to Ontario This book will help newcomers start their own business in Ontario; regardless of whether they have just arrived or have already been resident for several years. It shows newcomers how to find ideas for starting a business. It shows them what to do if they intend to develop a new product and how to protect their idea with a patent or copyright. It helps them if they intend to sell an existing product and either import it or export it. Then, it discusses some of the issues in starting a service business. In addition, it provides 20 sources of marketing information to help them determine whether their product or service will sell. A full chapter is devoted to all the legal steps for setting up a business as a proprietorship, partnership or incorporated company plus all the sales tax registration requirements in Ontario. Readers will learn how to market their products or services; set up their own website and conduct e-commerce. It will show how to use social media as an inexpensive advertising tool. This book covers equipment requirements and how to determine how many employees are needed. It covers all the legal obligations employers have when employing workers in Ontario and the alternatives of sub-contracting, using robots, factory automation and 3D printing. It looks at locating premises and the challenges of rent renewals. It also covers the tax and other advantages of operating as a home-based business. Newcomers will learn how to determine how much start-up capital they require and whether they can self-finance. If not, they will learn how to obtain bank financing or raise money by selling equity to venture capitalists or angel investors. They will be alerted to the due diligence process and some of the negotiation issues. They will also find out what's involved with crowdfunding and some of the regulatory hurdles. They will learn how to prepare a business plan and use it when seeking funding. This book covers 88 of the most popular Federal and Ontario Government financial assistance programs and sub-programs and provides 101 contact addresses. It shows readers how to maintain profitability once their business is operating by using cash management and cost control. Finally, it provides 48 sources of business start-up assistance in Ontario together with the addresses of 233 settler agencies which assist immigrants and refugees to settle in the province. Author, Iain Williamson, is a Canadian immigrant who has been running his own businesses in Canada for over 30 years. He is an entrepreneur, business consultant and seminar leader. His views have appeared in many newspaper articles. He has also been the guest speaker on a CBC Radio phone-in show on starting a business in a recession. In addition, he has appeared on television shows such as: CBC TV's Venture; TVO's MoneysWorth, and Canada Tonight of BCTV and CHCH Television. He holds degrees from Oxford University, England and from St. Andrew's in Scotland. He has successfully arranged bank and equity financing and has obtained government grants. He writes from firsthand experience which he shares with readers. This book is essential reading for every newcomer who wants to start a business in Ontario.
Newcomer's
Guide to Starting a Business in Ontario:
344
pages, Softcover; ISBN 978-1-55270-737-1;
published in March 2016; Canadian $49.95.
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DETAILED CONTENTS
Introduction: Welcome! You're Not Alone! How this Book can Help You
Chapter 1: The Important Role of Small Business in Canada The Big Picture What do we mean by a "Small Business" Small Business as a Creator of Jobs The "Independent Contractor"
Chapter 2: Where to Find Business Ideas What do People Want? The Internet Search Engines Narrow Down the Search An Example of a Search Trade Shows Print-on-Paper Trade Magazines and e-Magazines Visit Manufacturers' Websites to Get Ideas Visit Retail Stores and the Websites of Retail Stores to Get Ideas Catalogues Drop-Ship Arrangements Hobbies Foreign Trade Commissioners Buy on eBay Wholesale and Sell Individually Negotiating Prices for Resale Items Selling on a Consignment Basis Make Sure Manufacturers Can Back You Up Pay Attention to Disruptive Technologies! Get Ideas for Offering a Service Store Your Ideas Be Aware that Some Business Activities are Regulated Just Look Around You!
Chapter 3: Develop a New Product Make Your Own Products How Do You Protect Your Invention? How Can Patents Protect You? Patents in Plain Speak Patents in Canada What Is a PCT Application? Copyright Copyright in Canada "Fair Use" and "Fair Dealing" The Significance of Patent or Copyright Protection Register Trademarks Create a Working Prototype
Chapter 4: Sell an Existing Product Set Yourself Up as a Manufacturer of an Existing Product Sell a Domestically Produced Product Sell Imported Products Exporting Products from Canada Duty Deferral Programs Shipping Imported and Exported Goods NAFTA Do-it-Yourself Customs Clearance Customs Brokers Paying for Imported Goods Cash in Advance (CIA) Cash on Delivery (COD) Open Account How a Letter of Credit Works Irrevocable Letter of Credit Sight Draft Term Draft Confirmed Credits Revocable Credits A Word of Warning on Letters of Credit Collections Export Leasing Buyer Credits Supplier Credits
Chapter 5: Start a Service Business Services Can Cover a Wide Spectrum Selling Real Estate Bricks-and-Mortar Retail Stores Restaurants Financial Services Computer Repairs, Installation, Web Design Digital Photography and Film Making Book and Magazine Publishing There's More and More
Chapter 6: Is There a Market for Your Product or Service? The Big Question: Will it Sell? "Gut Feel" Marketing The Importance of a Market Survey The Challenge of Market Surveys for New Technologies How to Conduct Your Market Survey What Should Your Marketing Survey Tell You? Traditional Sources Public Libraries The Importance of Statistical Marketing Information Statistics Canada (StatsCan) U.S. Census Bureau UK Office for National Statistics (ONS) Eurostat Yearbook 2015 Ipsos Canada
Chapter 7: The Legal Aspects of Business Start-up Choose a Great Name! The Legal Structure of Your Business is Important Sole Proprietorships Partnerships Limited Liability Partnerships Tax Aspects of Limited Partnerships The Ontario Incorporated Company Professional Corporations Name Search The Federally Incorporated Company Cooperatives The Importance of Structure if You Are Seeking Financing Obtain Your Business Number (BN) Harmonized Sales Tax (HST) Corporate Income Tax Municipal Taxes Logo, Business Cards, Letterhead, Legal Documentation, etc.
Chapter 8: How Are You Going to Sell Your Product or Service? First: Get to Know Your Competition! Your Marketing Strategy Methods of Distribution Pricing Packaging and Merchandising Image Advertising and Lead Generation Create Your Own Website The Internet Brings it All Together from an Advertising Perspective! Do-it-Yourself Register Your Domain Name Web Hosting Web Design Software Use Social Media to Grow Your Business The Importance of Using Social Media when You are Starting Your Business Caveat: Social Media is "Social" not "Business Media" Social Media as the Great Equalizer The Cost Paid Advertising Watch Out on Paid Advertising Don't Treat All Social Media as the Same Web Blogs Google+ YouTube Flickr Is Social Media Worth The Time? The Big Shift to Mobile Don't Forget to Analyse Your Results Your Social Media Plan Promotion Your Marketing Plan Sell Your Products Online: eCommerce Your Shopping Cart Your Checkout Your Methods of Receiving Payment Payment Gateways Offer Alternative Ways for Your Customers to Order and Pay International Transactions Security of Transaction Main Types of E-Commerce Software The Plug-ins Stand-Alone e-Commerce Software
Chapter 9: What Equipment Will You Need? Equipment and Other Fixed Costs Leasing Hire Employees Who Know How to Use Your Equipment
Chapter 10: How Many People Do You Need to Help You? Human Resources Determine How Many People You Will Need to Hire Job Descriptions Form the Basis for Job Specifications It May Sound Crazy but Prepare Your Own Job Description! Prepare Job Descriptions For All Your Employees Salaries and Hidden Costs Payroll Account Number Minimum Wage Overtime Pay Hiring Canadian Workers Hiring Temporary Foreign Workers (TFW) Pay Equity Personal Information Protection Workplace Safety and Insurance Board (WSIB) Office of the Employer Adviser (OEA) Industrial Accident Prevention Association (IAPA) Termination or Severance Record of Employment (ROE) The Balancing Act of Paying to Hire the Best Talent and Trying to Keep Wage Costs as Low as Possible Third Party Liability Honesty Bonds or Fidelity Bonds Intellectual Property and Non-competition Agreements Employment Contracts Are Employee Share Ownership Plans a Dream? How Can ESOPs Help? Types of ESOPs Performance Bonuses Your Human Resource Plan Subcontracting Use Family Members Where Possible Computerization Factory Automation 3D Printing
Chapter 11: Your Choice of Premises Home-based Businesses are a Popular Idea Home-Based Businesses are Survivors How Legal is it to Work Out of Your Home or Apartment? Tax Advantages Save on Commuting Time Commercial Space Zoning Laws Bricks-and-Mortar Retail Space Watch Out for the Lease Renewal Trap Locating in a Mall Find Yourself a Good Lawyer Warehousing Bonded Warehousing
Chapter 12: How Much Money Will You Need to Start? What's Your Start-up Going to Cost? Use Cash Flow Projections to Calculate Your Needs Will Your Cash Flow be Adequate? Can Your Business Finance Itself? The Importance of Knowing What You Need Observations on Start-up Capital Needs How Long Will it Take to Arrange Financing? Costs to Raise External Financing Do You Have a Contingency Plan?
Chapter 13: Figure Out if You Can Finance It Yourself Figure Out if You Can Finance It Yourself Can You Supply You Own Start-up Capital? Some Preliminary Considerations The Personal Financial Statement What is Bootstrap Financing?
Chapter 14: Prepare Your Business Plan It's Essential to Have a Business Plan The Structure of Your Plan Economic Benefits Your Plan Should be Dynamic
Chapter 15: Debt Financing Central Banks The US Federal Reserve Board The Bank of Canada The Commercial Banking Function Canada's Chartered Banks Canada's Domestic Banks Commercial Banking Units Foreign Banks in Canada Canadian Credit Unions & Caisses Populaires Government Owned Banks Merchant Banks Canadian Trust Companies Types of Small Business Loans Operating Lines Term Loans Floor Plan Loans Warehouse Receipts Overdraft Facilities Letters of Credit Personal Loans and Credit Cards Subordinate Financing Preliminary Steps Before Applying for a Loan Preparing for a Loan Application Discretionary Limits View from the Banker's Side of the Desk Banker's Credit Review Bankers' Favourite Financial Ratios Collateral Banker's Assessment The Final Steps Factoring as a Method of Borrowing Methods of Payment Method of Financing Advantages and Disadvantages Where to Find Factors
Chapter 16: Equity Financing: Venture Capital, Angel Investing and Crowdfunding What is Venture Capital? How Did This Venture Capital Game Start? Typical Structure of Canadian Venture Capital Companies Who Are the Players in Canada? Fund of Funds How Much Money is Being Raised? Where is the Money Being Invested? What is the Money Being Invested In? How to Contact Them: Five Methods of Approach A Word of Caution The Challenge of Liquidity Realism of the Venture Capital Market From the Perspective of Small Business Financing Show Persistence! What is Meant by the Term "Angel?" The Funding Gap The American Experience Characteristics of Angels Angels As Risk Takers Angels in Canada The Importance of Angels Profiles of Canadian Angels Where do Angels Like to Invest? What do Angels Like to Invest In? What Form Does their Investment Take? How Long Does the Average Angel Stay on Board? How Successful Are the Marriages? Why Don't Some Marriages Make it to the Alter How Do Small Business Owners Use the Money? Another Business as an Angel Distributors Suppliers Customers Joint Venturing Potential Conflicts with Corporate Angels Clusters of Angels Syndication in Clusters Incubators and Accelerators The "Seedcamp" Model How to Meet Angels Negotiating With Venture Capitalists and Angel Investors The Goal of Negotiations The "Due Diligence" Process Valuation Expected Return on Investment Points Likely to Be Negotiated Total Financing Required How Much Money Have You Invested? Timing of the Investment Dilution Management and Other Fees Control Restrictive Covenants Affirmative Covenants Management From the Venture Capitalist's Viewpoint The Term Sheet The Legal Agreement Directorships Director's Liability Concluding Comments About Negotiating Rules of the Angel Game Check Out That Angel! What is Crowdfunding? Saskatchewan Adopted an Equity Crowdfunding Exemption Six Provinces Have Agreed to Crowdfunding Rules The Ontario Securities Commission (OSC) Seeks Public Comment on Crowdfunding Proposals Ontario's Crowdfunding Rules Accredited Investors in Canada National Crowdfunding Association of Canada (NCFA Canada) The Crowdfunding Loan Model Specific Loans vs. Autolending Crowd-Based Lending is Dependent on Prevailing Interest Rates Types of Loan-Based Crowdfunding Invoice-Factoring Crowdfunding Canadian Peer-to-Peer Crowdlending Portal The Basic Concept Behind the Rewards Model or Perks-Based Crowdfunding Charitable Giving is Not Motivated by Profit-Making and Generally Falls Outside of the Regulatory Net The Canada Revenue Agency (CRA) Finally Makes its Position Known With Respect to Rewards-Based Crowdfunding Canada's Draconian Anti-Spam Laws Could be a Crowdfunding Killer Rules of the Crowdfunding Game
Chapter 17: Federal Government Financial Assistance Canada Offers Many Business Assistance Programs The Canada Small Business Financing (CSBF) Program Business Development Bank of Canada Futurpreneur Canada National Research Council Canada (NRC) Scientific Research and Experimental Development (SR&ED) Tax Incentive Program Trade Commissioner Service (TCS) Export Development Canada (EDC) Small Business Internship Program (SBIP) Heritage Canada FedNor (Federal Economic Development Initiative for Northern Ontario) FedDev Ontario: Federal Economic Development Agency for Southern Ontario
Chapter 18: Government and Other Financial Assistance in Ontario Ontario Offers Many Business Assistance Programs Government and Other Financial Assistance in Ontario Eastern Ontario Development Fund Ontario Ministry of Citizenship, Immigration and International Trade Ontario Ministry of Economic Development, Employment and Infrastructure Ontario Youth Employment Fund Starter Company Ontario Works Ontario Youth Job Connection Canada-Ontario Job Grant The Yves Landry Foundation (YLF) MaRS Investment Accelerator Fund (IAF) Micro Finance Program Ottawa Community Loan Fund (OCLF) ACCESS Community Capital Fund (ACCF) Rise Individual Lending Program PARO Centre for Women's Enterprise London Community Small Business Centre Accelerator Centre (AC) Centre for Social Innovation (CSI)
Chapter 19: How to Maintain Profitability Once Your Business is Operating The Basics of Cash Management Accounts Receivable Credit Ratings Collecting Monies Due Overdue Accounts Set up a System to Control Your Receivables Accounts Payable Cash Balances Inventory Management Inventory Management for Retailers Control Your Energy Costs Your Transportation Costs Your Travel Costs Your Communication Costs Your Advertising Costs Quality Control Waste Management Theft and Shrinkage Your Rental Space Costs Your Pricing Strategies Tax Planning Cash Budgeting Can Licensing Reduce Cash Outlays?
Chapter 20: Sources of Business Start-up Assistance for Newcomers Canada Business Ontario Small Business Enterprise Centres (SBECs) Community MicroSkills Development Centre Stiller Centre for Technology Commercialization Invest Ottawa Y Enterprise Centre - Ottawa Centennial College - Centre of Entrepreneurship McMaster Biosciences Incubation Centre (MBIC) Hamilton Technology Centre Toronto Business Development Centre (TBDC) Toronto Food Business Incubator (TFBI) The Toronto Fashion Incubator (TFI) Northwestern Ontario Innovation Centre Northern Centre for Advanced Technology Inc. (NORCAT) IDEAHUB: Port Hope Business Incubator Augesco Business Incubator TheCodeFactory Ryerson University's Digital Media Zone (DMZ) Innovate Niagara Mobile Experience Innovation Centre (MEIC) Sault Ste. Marie Innovation Centre SpringBOARD Innovation Centre DreamBuilderStudios Canadian Industrial Innovation Centre, Waterloo, Ontario Enactus Canada Startup Canada Women Entrepreneur Fund TruShield Retail Startup Fund MITACS Ontario Centres for Excellence Entrepreneurship Programs Skills for Change Newcomer Settlement Agencies
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