My own Canadian business questions :D

[AmyW]

Rather than hijack/bump the other threads, I'll start my own.

I'm definitely going into business in 2012, and will be in Alberta doing so. I've got most of the information I need but I have a couple specific questions.

1. I have one soap that I'd like to be able to label as soothing (or some other accurate descriptor) for psoriasis & eczema. It's my understanding that in doing so, turns it from a soap into a drug. What process do I need to go through so I can do this accurately and legally?

2. For my gardener's soap, does labeling it as "extra cleansing" or similar description change it from soap to drug? The stuff is amazing and I want to label it as such lol.

3. I will not be making more than $10,000/yr from this business for at least a few years, so what kind of taxes am I looking at? Do I need to collect any sales tax? If I do, what do I do with it? Just send it to the government? Monthly, quarterly, yearly?

4. I will have a website - should I limit sales to only Canadian customers or is it worth it to deal with shipping to the US and other countries? I don't know how to treat customs and duty and laws in the destination countries for shipping soap (which whatever country might treat as a drug).

5. Do I need anything special to sell at farmer's markets? I won't be able to have a B&M store because we'll live way too far from town to make it worth it, but I can do farmer's markets once a week.

6. Along with 5, what are the legal requirements to be able to have local stores carry my soap?

I plan on getting insurance, registering the business, etc already, but these things are still confusing me. Thanks!

 

[Relle]

I don't know the labeling laws in your country, but for question 1 could you put on it - may help to sooth psoriasis and eczema.

 

[brnicholas]

You might check with the postal service about International Shipping. We ship to Japan quite frequently and the form is very simple. Actually, you just answer a few simple questions and the computer takes care of the rest, either through the postal service website or PayPal. Your customer will expect to pay a little more for International. I think it is worth it because, and I don't know exactly why, we have many repeat customers in Japan.

 

[Lindy]

Rather than hijack/bump the other threads, I'll start my own.

I'm definitely going into business in 2012, and will be in Alberta doing so. I've got most of the information I need but I have a couple specific questions.

1. I have one soap that I'd like to be able to label as soothing (or some other accurate descriptor) for psoriasis & eczema. It's my understanding that in doing so, turns it from a soap into a drug. What process do I need to go through so I can do this accurately and legally? This would turn it into a drug. You can claim moisturizing, make sure you are only making cosmetic claims.

2. For my gardener's soap, does labeling it as "extra cleansing" or similar description change it from soap to drug? The stuff is amazing and I want to label it as such lol. Yes

3. I will not be making more than $10,000/yr from this business for at least a few years, so what kind of taxes am I looking at? Do I need to collect any sales tax? If I do, what do I do with it? Just send it to the government? Monthly, quarterly, yearly? You don't need to worry about registering for sales tax (GST only in Alberta) until you hit $30,000. Now having said that I do recommend becoming a GST registrant and filing quarterly as it will allow you to claim back all the gst you pay our for supplies, shipping, etc which you won't be able to do otherwise.

4. I will have a website - should I limit sales to only Canadian customers or is it worth it to deal with shipping to the US and other countries? I don't know how to treat customs and duty and laws in the destination countries for shipping soap (which whatever country might treat as a drug). Selling into the States is quite easy, register with Canada Post for a Venture One account and you can do it all on-line and print your shipping labels. It will save you 5% as well.

5. Do I need anything special to sell at farmer's markets? I won't be able to have a B&M store because we'll live way too far from town to make it worth it, but I can do farmer's markets once a week. You do need insurance - depending on where you are in Alberta you might want to check with your local The Cooperators.

6. Along with 5, what are the legal requirements to be able to have local stores carry my soap? All of your soaps, whether selling into stores, at markets, festivals, etc. must be registered with the government of Canada using THIS FORM. There is no charge to file and it is super easy to do so. You also require insurance as mentioned above.

I plan on getting insurance, registering the business, etc already, but these things are still confusing me. Thanks!

Let me know if you need any other questions answered. Canada has some steps to take, but really it is not that onerous. You also want to read THIS PAGE as well to fully understand your labeling guidelines, as well as what restricted ingredients there are.

HTH

 

[AmyW]

Thanks for the responses!

For shipping internationally, is it that simple? I can just drop into Canada Post and mail off packages without having to deal with duty/customs? When I mail gifts to my husband from US to Canada, I have to fill out this obnoxious form that details the contents and value, my contact info, his contact info, etc.

I'm reading through the Labelling of Cosmetics page, at
http://www.hc-sc.gc.ca/cps-spc/pubs/ind ... ex-eng.php

It says:

COSMETIC - Section 2 of the Food and Drugs Act - Includes any substance, or mixture of substances, that is manufactured, sold, or represented for use in cleansing, improving, or altering the complexion, skin, hair, or teeth.

Am I pushing my luck thinking it would be acceptable to claim: may improve appearance of psoriasis/eczema.

 

[Lindy]

Hi Amy,

The forms for international orders when done online at Canada Post are super easy, they're not looking for ingredients, just what it is i.e. soap which has its own code, then made in Canada and then your province. The weight and value of the product. Also how many of each that you're sending out and that the currency is Canadian. That easy.

As for that claim it really could get you in trouble with Health Canada. Focus more on how moisturizing it is. If you have testimonials from customers about the claims - post those on your website, but you can't make that claim without registering it as a drug.

Cheers

 

[AmyW]

Thanks Lindy!

I'll have to eventually look up what it would take to register a product as a drug. I love the idea of testimonials, they speak for themselves without me having to say much; so I'll stick to the basics and include those.

 

[Karri]

Hi Amy - I'm in Alberta too and considering a soaping biz at some point. I hope it's okay if I jump in with my questions and maybe we can help each other with this learning curve! I have another business already but soaping is its own animal

Lindy - is it true that insurance is a lot higher if you ship to the US/and/or/internationally? The US is obviously a huge market to exclude. But I'd think that Cdn soapers exporting to the US would be expected to comply with US law for soap/cosmetics and those laws may differ somewhat ... thus more risk?

Amy or Lindy - could one of you point me to the HC guidelines that discuss advertising claims like the type you're discussing?

Karri

 

[Lindy]

Hi Karri - sorry for the delay just got back from a show.

Insurance - I sell internationally and as long as your %age to Canada is higher than the combined out of country sales then there is no increase to my insurance.

HERE is the information on labeling. Your claims can be cosmetic only. HERE is the information on what claims you can make on your labels.

Exporting to the US is easy since Canada's regulations are more stringent than the US - the EU is whole other ball of wax if you're sending it in for resale... you would require a safety assessment, although that usually falls onto the shoulders of the reseller.

HTH

 

[Karri]

Thanks Lindy! Just got back from holidays so just seeing this now.

I was able to dig up the stuff re advertising claims on the HC website but actually hadn't seen the Dept of Justice page. Sheesh! Each time I think I've uncovered all the rules and regs I realize there is something else to read. So that means there are guidelines set out by three departments then:

Health Canada
Industry Canada
Department of Justice

Am I missing any others?

Question: when you ship to the U.S. do you use different (English only) labels or do you just retain the same bilingual labelling you use for Canadian sales?

Good to know about insurance. I'm trying to get some info from The Co-operators here in Lethbridge so this will be on my list of things to consider when getting a quote.

Because I'd like to eventually create a strong online presence I would imagine that eventually US sales could outpace Cdn ones ... but I say that only based on my past experience in a totally different industry. Americans generally seem more willing to spend online than Canadians. i.e. when I was consulting online most of my clients were in the U.S.

Karri

 

[Lindy]

For most of my labels they don't need bilingual since I have using "names" for the soap as well as my company name. The ingredients are INCI which does not require translating other. When you put on instructions for use this will need translation.

I use the same labels when shipping to the US as I do for my Canadian customers, unless I have a wholesale order or Private label order then I go English only on their labels.

I think you have the rest of it covered.

I promise once you start doing it, you'll find it quite easy...

 

[Karri]

I promise once you start doing it, you'll find it quite easy...

I'm gonna hold you to that, Lindy! :wink:

Now what about marketing copy beyond the label? i.e. websites/brochures/etc? This seems to be uncharted territory to some extent ...

I remember reading something in the HC guidelines re radio but I honestly can't see myself having to worry about that in the near future. However, there are a lot of marketing mediums available to us now and I wonder how advertising claims for soap fit into it all. (Yes, jumping WAY ahead here but I can't help it ... I'm a marketer by 'trade.' LOL)

Karri

 

[Lindy]

Okay marketing and claims allowed:

If you read the regulations you are not allowed to make any medical or healing claims about your products. You can claim cosmetic results such as "May reduce the appearance of fine lines and wrinkles."; "Conditioning"; "Moisturizing" and things of that nature. You really need to steer clear of things like soothing, healing, remedy, etc.

Check the newspaper and local magazines such as THIS this one. I advertise in something very similar and I have found the results to be impressive. It helps you with your branding and you can let people know where you are in that month. There are a couple of malls in your area, look into them for table rentals or Kiosk rentals. If you stay in one place like that throughout most of the year on weekends (maybe two weekends a month) then you will find you build a strong following.

Radio - haven't done that - too much money as well as TV (cable channel).

I also am an active member of the community and donate to causes that actually mean something to me personally.

Hope that is what you were looking for.

Cheers

 

[Karri]

Thanks Lindy.

Definitely helps to think of the "line" as being medicinal vs cosmetic. Totally makes sense.

I have years of online marketing experience and a little offline too. When I decide to finally sell my soap I know I'll be pushing for a strong online presence. (Might as well leverage what I know.)

Though I want to do some "local" selling too ... it just seems so rewarding!

Karri

 

[radiojim]

I think selling locally is the most rewarding thing. My wife and I sell at flea markets and such on weekends. Sometimes we just have a sort of garage sale. It's fun to meet people. Course, you won't get rich that way. We've done some Ebay sales too. You might want to consider signing up with a directory like Canada Pages