Importing Punjabi Suits and Jewellery from India to Canada

The concept of globalization and integration of nations

The world has become increasingly globalized. The term refers to the integration of nations on a social, economic or even legal basis. The homogenization processes also become apparent with respect to the legal systems applicable worldwide. The platforms created provide an avenue through which countries can engage in trading activities (Burlacu, Gutu & Matei, 2018). The evaluations conducted in 2019 indicates that Canada engaged in merchandise trade with India culminating in an exchange of goods worth $10.1 billion (International.gc.ca, 2021).

The acquisition of Punjabi suits and jewellery from India would ensure that customers have a wide variety of items to select from. Additionally, obtaining the items from the source ensures that clients have varying qualities of the same products as per their preferences and purchasing power. For instance, customers have an option of selecting Punjabi suits made from cotton, crepe, silk or even georgette as well as other fabrics (Naik, 2017). Furthermore, they can select various designs for the ethnic wear to match the events that they might be attending. On the other hand, Indian culture highly values jewellery. Thus, people in the country have access to ornaments made from silver, gold, diamonds and other gems. Importing items from India ensures that the targeted clients can obtain high-quality handcrafted jewelry and garments at reasonable prices. For instance, acquiring Indian suits from Canadian tailors may cost $3500. Furthermore, customers anticipate expenses amounting to $15 for a modiste to alter a shirt. Even so, indigenous seamstresses based in India demand a lower fee to stich raiment as desired by clients as they can easily access the fabrics needed to put together the clothes. The primary reason for importing from India and selling it in Canada is the cheaper cost of labor and material in India, as compared to Canada. The data shows that presently almost 58.86 INR is equal to 1 CAD and hence, it may be stated that the business will be profitable if it acquires materials from the Indian market (Xe.com, 2021).

Additionally, if bulk orders can be procured from the Canadian market, the transportation cost from India to Canada will also be considerably low. Also, I have a number of Indian friends here in Canada and they travel frequently to their home country. Even, they can also bring a small piece of materials and dress garments along with their personal parcel and belonging, if initially bulk orders may not be received. So, in nutshell, procurement will not be a costly affair.

Procurement of Punjabi suits and jewellery from India

Canada is an advanced nation which have many Indian immigrants. The business model presented here is an import export model. The strength of importing the garments and matching jewellery of Punjabi Suits from India is beneficial as the cost of production would be lower in India and in Canada (the Guardian, 2019). The specialization of Indian workers

who are making the garments is also another factor that is beneficial, they have the expertise of various kinds of designs, use of materials which matches the culture of India to cater to the Indian immigrant female community of Canada. The location of the business in Prince George which have less competition in terms of business owners catering to Indian immigrants. This is a lucrative opportunity to set up a firm with high investment into its inventory. Prince George can be made a hub where Indian immigrants get a taste of their own culture as it is a highly developed city (gov.bc.ca., 2021). The per capita income is also high.

GDP is changing and growing up. It would be a benefit for my business and there would be chances of increasing sale of my goods in Canada.

The primary weakness associated with the imports business pertains to the financial obligations affiliated with the procedures involved. More distinctly, Canada imposes duty rates at an average of 17.5% (Canada Border Services Agency, 2021). Before availing Punjabi suits and jewellery to clients in Canada, it becomes necessary to fulfil some legal requirements. The process may prove tedious and quite lengthy. More specifically, running the business will necessitate acquiring a number designated to the enterprise issued by the Canada Revenue Agency. The requirement applies to the operation's import-export account. On the other hand, Canadian authorities consider it of great importance that vendors fill all the necessary documentation comprehensively and accurately, in lieu of their jewellery shipments. Additionally, the Canada Border Services Agency may require some additional details before accepting the items into the country (FedEx, n.d). Moreover, after the clients obtain the items requested for, it might become difficult to modify them as the business will lack on-site craftsmen. In some cases, the prices of precious stones may fluctuate depending on their availability. Such scenarios culminate in an overall increment of the costs associated with specific ornaments. Since, the local market of Prince George is comparatively smaller, in relation to Surrey, it may be stated that such a small market will involve the risk of lower revenue. Since a part of the cost component will be fixed, lower revenue will denote the business risk of lower profit. One of the big things is that my business leads to promote social integration. Globalization leads to social integration. Here, in my business, two culture are coming together.

Advantages of acquiring items from India

The major weakness of an import export model is the cost of transportation of imported products into Canada from India. When the cost of transportation is more, the importer would have to charge very high price, which would negatively impact the demand of the product in Canada. Moreover, the import location is Prince George, where there is very less Punjabi Immigrants. Again, Prince George does not have higher competition in the sale of Punjabi suits but the market is small. The demand is the most important parameter for a business to run. When there is high demand, then the growth of the business is also high. However, Prince George has very less demand which can be a negative impact on business growth and development in future. Moreover, due to higher transportation costs of imports there can be harmful for the profits and sales, if they are not provided with attractive deals.

My assessment of Prince George, Canada reveals that the market remains fairly unexploited. Therefore, clients have limited options with regards to the number of vendors from whom they can obtain Indian jewellery and Punjabi suits. Moreover, retailers operating in PG have a limited variety of items from Punjabi including traditional shoes. Thus, I could capitalize on such an opportunity. Through geographic segmentation, I intend to cater to any prevalent needs among customers residing in PG owing to the size of the business and its limited financial capacity. Furthermore, a limited number of competitors will lower the risks associated with carrying out various business activities. Despite the fact that I will run a physical outlet in Prince George, I can embark on marketing campaigns that will target Indians residing in places such as Vancouver and Surrey. Under such circumstances, I can effectively grow the business to ensure that it expands to other Canadian regions. Taking reference from the previous point, it may be stated that the small market of Prince George will have less competition and hence, the business may be able to achieve sustainability soon. Also, the product may be targeted at female students from Colleges and Universities like the Universities in Prince George, the University of Northern British Columbia etc. Additionally, the promotion of the product may be made in other surrounding and big cities like Surrey where the conversion rate will presumably be high. The opportunity of development of this import export model can be enhanced if the business has certain capital investment from any local garment shop of local chain. The business idea is development of a firm which can produce Punjabi suit and jewellery to the local Canadian immigrants. Even if the business owner is importing the products from India, a capital investment to show cultural collaboration of Canadian and Indian culture would raise the attractiveness of the business (Najafi-Tavani et al., 2018). Product designing in line with both Indian and Canadian culture can also attract the Canadian people to buy Indian dresses and jewellery (Visnjic, Wiengarten & Neely, 2016). The business can also set up online shopping trends which would raise the efficiency level and diversify the customer base. Setting up higher inventory for online and offline shopping and targeting the young students of Indian background can bring increasing sales (Priem, Wenzel & Koch, 2018). The business would first thus require the collaboration of a local investor who can fund the supply chain not only in the city but also in other neighbouring cities. Market penetration through FDI is a very promising way to start a business.

Challenges associated with running an import business

The data shows that the inflation rate of India was 3.72% in the year 2019 which increased to 6.62% in the year 2020. Moreover, the effect of a pandemic due to Covid-19 has been adverse on the Indian economy which has slowed down the rate of industrialization and development therein. Hence, it may be stated that the growing inflation rate in India may pose a threat to the intended business, as far as cost structure, pricing and financial feasibility as a whole of the business is concerned (Macrotrends.net, 2021). Additionally, I would also like to state that the business of jewellery is largely based on conspicuous consumption of middle-class income groups. The current financial downturn globally, primarily due to the pandemic situation, has caused a drastic fall of surplus and disposable income in the hands of the middle-income group segment. As a result, the industry has been experiencing a decline for the last two years. However, the industry has a total worth of 8.2 billion CAD in the year 2018 and it is expected that the demand for jewelry including junk jewelry along with designer garments will increase in the next couple of years (Statista, 2021).

In the event that the business becomes lucrative, I anticipate having to compete for available customers with new entrants. Additionally, the increasing availability of counterfeit goods may extensively reduce the profits anticipated from the business as clients opt for cheap trinkets and Punjabi suits made from cheap fabrics. The statistical data currently available indicates that as of 2022, the industry dealing with developing fake products will have a value of $4.2 trillion (Wight, n.d). The main threats to the business is investment, if the business is unable to attract a local investor, then setting up a huge inventory to cater to consumers in Prince George and neighbouring cities can be difficult. Moreover, importing from India can attract import tariffs which would raise the prices in Canadian market even more (Wits.worldbank.org., 2019). The cost of transportation into the Canadian market is already high and if the import tariff is imposed the business would not attract consumers and high price of the product would diminish demand to higher degree.

Prince George offers a suitable location for selling imported Punjabi suits and ornaments obtained from India. The region has a vastly untapped market that would provide an impetus for an upcoming business to thrive. Even so, the availability of counterfeit commodities from unscrupulous dealers may adversely affect business growth and the revenues anticipated. We can conclude from this analysis that import of the products can be costly and prices can be very high if there is an import tariff imposed on the materials and ready-made jewellery and garments. This would have a negative impact on the demand and reduce the sales. However capital investment by a local investor on the business can raise the credibility and scope of the business.