27 May Why You Should Consider Ottawa for Canadian Distribution Instead of Toronto
Especially for US companies, the first place that comes to mind when choosing a location for expanding warehousing and distribution within Canada is Toronto. After all Toronto, some would argue, is the largest, most popular and well known city within Canada. But assuming that Toronto is the best location for all companies would be making a huge assumption – and one that could cost your business both money and opportunity.
Make Sure You Consider All Location Options
When taking a look at Canadian warehousing and fulfillment, businesses should look at the various population centers throughout Canada. According to City Population, in 2014 the top six largest cities were as follows: Toronto 6,055,724, Montreal 4,027,121, Vancouver 2,470,289, Calgary 1,406,721, Edmonton 1,328,290 and Ottawa 1,318,122. The number one city on this list may not be a surprise, however, the number two and six largest cities on the list bring up some interesting thoughts, especially for people in the United States. First and foremost, Montreal is the second largest market and has a vast consumer base. It’s the type of city that businesses wouldn’t want to ignore. Second, a surprisingly high number of people live in the nation’s capital of Ottawa – a place that just so happens to rest geographically between the top two cities on the list. In fact, Ottawa missed being the fourth largest city by a little over 88,000 people.
Ottawa Offers a Central Distribution Point for the Western Canada Market
In order to cut down transit times and shipping costs for individual orders, Ottawa offers a distinct advantage. The nation’s capital rests a mere 2 hours drive from Montreal (198 km) and only 4 hours from Toronto (449 km). Because of its strategic location, in instances where companies are trying to ship to all of the Western Canadian cities and not Toronto alone, a central point of distribution can prove to be very beneficial.
Check the Costs of Each Potential Location
Whether you’re looking to open your own warehouse or use an outsourced warehousing solution, taking a look at the costs can be eye opening. Looking at the consumer price index as well as rental rates in the various areas will offer a snapshot of the potential costs in that area. When comparing Toronto to Ottawa, the numbers are very eye opening. Consumer price index is 5% higher in Toronto than Ottawa. Furthermore, rental rates are over 35% higher in Toronto on average than Ottawa. These estimates of cost and price will translate into higher warehousing and labor costs in Toronto than Ottawa.
An Interesting Thought About Montreal
One factor to keep in mind when gauging a potential warehouse location within Canada is the language and cultural challenges that exist in Montreal. Because it is both an English and French speaking area, companies will have to come up with a game plan to be able to take advantage of the French speaking population. For example, Ottawa Logistics has both English and French speaking staff, which helps its US and Canadian customers take advantage of this powerful market.
Take Time to Make the Best Decision
Bottom line – it’s important to take a thorough look before leaping into Toronto as a choice for warehousing and distribution within Western Canada. Again, there are instances when Toronto is the best option. However, after looking at some of the above thoughts and examples, it becomes clear that other options might prove to be more beneficial, such as the central city of Ottawa.