Canada market
Canada
Fig. 1 National flag of Canada
Canada is a country in the northern part of North America. Its ten provinces and three territories extend from the Atlantic to the Pacific and northward into the Arctic Ocean, covering 9.98 million square kilometres (3.85 million square miles), making it the world's second-largest country by total area. Canada has the sixteenth-highest nominal per capita income globally as well as the twelfth-highest ranking in the Human Development Index. Its advanced economy is the tenth-largest in the world, relying chiefly upon its abundant natural resources and well-developed international trade networks. Canada is part of several major international and intergovernmental institutions or groupings including the United Nations, NATO, the G7, the Group of Ten, the G20, the North American Free Trade Agreement and the Asia-Pacific Economic Cooperation forum.
Fig. 2 Map of Canada
Canada is the world's tenth-largest economy as of 2018, with a nominal GDP of approximately US$1.73 trillion. It is one of the least corrupt countries in the world, and is one of the world's top ten trading nations, with a highly globalized economy. Canada has a mixed economy ranking above the U.S. and most western European nations on The Heritage Foundation's index of economic freedom, and experiencing a relatively low level of income disparity. The country's average household disposable income per capita is "well above" the OECD average. The Toronto Stock Exchange is the ninth-largest stock exchange in the world by market capitalization, listing over 1,500 companies with a combined market capitalization of over US$2 trillion. In 2018, Canadian trade in goods and services reached CA$1.5 trillion. Canada's exports totalled over CA$585 billion, while its imported goods were worth over CA$607 billion, of which approximately CA$391 billion originated from the United States, CA$216 billion from non-U.S. sources. The country's 2019 trade surplus totalled CA$762 billion, compared with a CA$46.9 billion surplus in 2008.
1. Introduction to Canada
The Canadian household appliances market has experienced growth from 2011 to 2013 after very strong decline in 2010. The market is predicted to grow at a very weak ratio over the forecast period. Table 1 shows the household appliance market in Canada, the market had total revenues of $5,898.9m in 2013, representing a compound annual ratio of change (CARC) of -0.1% between 2009 and 2013. In comparison, the US and Mexican markets grew with compound annual growth rates (CAGRs) of 2.4% and 6.5% respectively, over the same period, to reach respective values of $39,430.1m and $6,120.3m in 2013. Electricals and electronics retailers account for the largest proportion of sales in the Canadian household appliances market in 2013, sales through this channel generated $3,093.2m, equivalent to 52.4% of the market's overall value. Sales through hypermarkets, supermarkets and discounters generated revenues of $703.5m in 2013, equating to 11.9% of the market's aggregate revenues. The performance of the market is forecast to accelerate, with an anticipated CAGR of 1.6% for the five-year period 2013 - 2018, which is expected to drive the market to a value of $6,390.8m by the end of 2018. The growth chart is shown in Figure 3 since 2009 to 2018. Comparatively, the US and Mexican markets will grow with CAGRs of 2.4% and 4.4% respectively, over the same period, to reach respective values of $44,458.4m and $7,608.2m in 2018. In 2018, the Canadian household appliances market is forecast to have a value of $6,390.8 million, an increase of 8.3% since 2013. The compound annual growth rate of the market in the period 2013–18 is predicted to be 1.6%.
Table 1 Household appliance market value in Canada
Fig. 3 Growth chart of household appliances in Canada market (2013 to 2018)
2. WDIRC selling
The forecast of WDIRC selling can be shown in Table 2 during the first ten years since product launched. Here the assumptions of households, occupancy ratio, initial sale, selling price, and manufacture cost are 13,320,610, 0.0060%, 799, 350 and 200, respectively. The first year is set as the baseline for comparison with the following years, the sale volume, year penetration, revenue, cost and profit are 799 (sets), 60 (ppm), 279,733(USD), 159,847 (USD) and 119,885 (USD), respectively. As we think, the growth rate with years will be 1, 2.59, 4.02, 5.26, 6.96, 7.49, 8.89, 10.48, 10.85 and 11 times over the first year. The year penetration of WDIRC will be from 60 ppm to 660 ppm at the end of tenth year, the totally ownership (penetration) is close to 0.411%, it still is a low penetration ratio in Canada even WDIRC listed in market for ten years. However the revenue, manufacture cost and profit these three also present an ascending trend, the profit earned from Canada is about $ 1.318 million at the tenth year in an exclusive market, it owns a huge market and profit in this market. Totally according to our prediction and assumption, the selling in Canada will be up to 54,774 sets, even this, the penetration ratio is still lower than other consumption electric products such as TV, Refrigerator, Air conditioner, and Wash machine.
Table 2 To estimate the selling of WDIRC in Canada
How about the annual growth rate for selling WDIRC in Canada market? Fig. 4 shows the result. Here the calculation of revenue can use this equation as “WDIRC’s Revenue = Annual growth rate * Year + Baseline”, the formula can be written in a mathematic equation in Figure. According to this regression by data simulation, the annual growth rate it take about 324.711k per year (r2 =0.9762), in other words, by averaged the annual revenue is 324.711k in Canada market for selling WDIRC product.
Fig. 4 To estimation the revenue of WDIRC selling in Canada market
3. Rice selling
A ten-years forecast to WFR sale, after WDIRC launched in Canada market, is presented in Table 3. The first year since the marketing of WDIRC, online/offline deals for WFR sale are 1,084 kg, here the assumptions of population, rice consumption, sharing of WFR, online buying rate and market sharing are 36,155,487, 10.00, 0.01%, 10.00%, and 30%, respectively. How to calculate the WFR volume by online/offline sale, Eq. 1 is the equation for calculating the WFR sale volume.
Eq. 1 SaleVolume=Population x RiceConsumption x WFRratio x On/OffBuyingRatio x MSharingRatio
(eg. 1,084 = 36,155,487 x 10.00 x 0.0001 x 0.1 x 0.3)
The use rate of WFR is set as 0.00003 kg/person-year. Based on this, we can get the annual revenue is $ 1,084 (WFR priced as $1), and the profitability is set to 10%, so the profit that will earn $ 108. Changing with the time, the ratio of WDIRC in kitchens will increase and cause the use of WFR increasing. We assumed the series of growth rate (G.R.) by years is 1, 1.19, 2.60, 8.24, 14.54, 16.39, 23.07, 28.21, 33.23 and 35.24. G.R. it is based on the prediction of WDIRC’s growth. By this series of G.R., both revenue and profit, they will also be presented like this serial when the dealing cost of WFR through online/offline transaction is keeping constant. Whatever the cost of online/offline transactions depends on the volume of WFR’s selling, so if the volume with time is scaling up, the dealing cost will be significantly lowered, in other words, the profitability with time will increase more than our prediction. If all hypotheses are true, the profit in tenth year will approach to $ 3,820. Eq. 2 calculates the penetration of WFR which to be used in this country by people. From this indicator (URate of WFR), we can see the level of penetration of WFR, even at the tenth year, the level of WFR use rate in Canada is still underestimation, that’s meaningful for us to optimistically think, the use rate of WFR can be easy completed and it will be grew up more than our prediction.
Eq. 2 URate of WFR = SaleVolume of WFR / Population
(eg. 0.00003 = 1,084 / 36,155,487)
Table 3 To estimate the selling of WFR in Canada
Regarding the revenue of WFR selling in Canada, Fig. 5 shows the result. This is a prediction by data simulation according to our assumption, the regression could be calculated as “WFR’s revenue = Annual growth rate * Year + Baseline”. The result shows the annual growth rate is 4.644k per year (r2=0.9761), in other words, the increasing of revenue of WFR selling in Canada is $4.644k dollar per year. This growth can help the company to maintain its team in the local market for servicing customers.
Fig. 5 To estimation the revenue of WFR selling in Canada market
4. To summarize the revenue and profit
Here according to the estimations above, we summarize the incomes from sales of WDIRC and WFR in Canada. Both revenues and profits are presented in Table 4. In the first year, the products of WDIRC and WFR are unfamiliar with Canadian people; namely the recognition and acceptance aren’t well to local consumers, so on the beginning (1st year) sales would be not good and the totally revenues and profits will be $ 280,817 and $ 119,994, respectively. Both of them will increase with years when selling with good experiences and promotions. Through our forecast, at the end of tenth year, the profits of WDIRC and WFR will be up to $ 1,318,650 and $ 3,820, and the totally profit will be $ 1,322,470, this is a huge profit which be created in Canada market by our novel products and services.
Table 4 To estimate both revenues included WDIRC and WFR selling in Canada
Totally the revenue of WDIRC and WFR (2W) selling in Canada market can be shown in Figure 6. The 2W revenue in first year is $280.817k dollars, after that the growth rate of revenue is $329.354k per year, this is a simple regression by mathematic model to predict the revenue on product selling. In practice, there are other factors that need to be considered much more, it could be higher than this or lower. Whatever by this calculation let us to trust that the market it always be there.
Fig. 6 To estimation the revenue of WDIRC and WFR selling in Canada market