ExportWise is counting down our 10 best performing stories from 2016. This story, first published on July 6, is #9 on our list.
Ally Contardi is the Director of Finance & Operations at Connected Lab – a Toronto-based company that specializes in building software for a wide range of connected devices.
You can learn more about their export success story here.
1. What was your first export sale?
In late 2014, we won our first deal with a large consumer electronics company based in the U.S.
2. How did that first export opportunity arise?
It started as a small prototype engagement with them, which lasted a few weeks. That led to two bigger projects with the same customer, one of them was worth more than $1 million for a year-long engagement to work on some of their in-home connected products. The relationship came as an introduction to our CEO by a former colleague. They were looking for software help and they knew about the team’s previous experience.
3. When it comes to exports, what do you know now that you wish you knew then?
When we first started out, we didn’t know that there were companies such as EDC that could help mitigate the risk that we faced working with startups and new ambitious brands globally. We did have one experience, where a company defaulted on their payment because they did not receive the funding they were supposed to. Now we’re better situated because we’ve met with EDC and our bank to discuss what we need to do to mitigate risk in the future.
4. How has the trading world changed since you started in business?
The Canadian dollar has weakened, and given that we deal with mostly U.S. clients, we’ve been in a fortunate situation. The majority of our costs are in Canadian dollars and 80 per cent of our sales are in U.S. dollars. We have now started to think about ways to hedge and gain more insights on how we can benefit from where the dollar is today. That’s the biggest change we’ve seen. When we started, the dollar was at par, so we know what that threshold is.
5. What is the #1 thing new SMEs need to know about export and trade?
I think they need to know about organizations such as EDC and ways to mitigate risk when dealing with international clients. It’s hard to know of all the services available to SMEs without doing some research. Also, the Canadian dollar is very volatile right now; so keeping an eye on currency rates is something that we would recommend to Canadian companies. If a company chooses not to do this, it could affect their profitability.