A retail business sells products directly to consumers from a location such as a storefront, a mobile kiosk or an online shop.
This guide will give you general information and regulations for operating an independent retail business. For information on buying a franchise, visit the Canadian Franchise Association website or call them at 1-800-665-4232.
When you start a business there are several things to consider before you can sell your product or service. Most businesses in Ontario need to complete a minimum of three basic steps:
Our business start-up guide will give you more information on these steps and other basic requirements for starting a business in Ontario.
Business Start-Up Guide
For most businesses, choosing an appropriate location is critical. Your ideal location will depend on your business needs, zoning restrictions and where your customers and competitors are. Taxes, noise and the local business environment are also important factors to consider when reviewing your options.
Choosing and Setting Up a Location
Contact your local municipality to determine what zoning requirements will apply to your location before you start selling. Visit the Association of Municipalities of Ontario (AMO) website for a listing of municipalities.
Association of Municipalities of Ontario
Your inventory is made up of the products you have in stock. Managing your inventory accurately will show you which products are in demand and which ones are not selling. Keeping track of what you sell can make it easier to determine which products to stock.
A supplier provides the products you need to run your business. Finding the right suppliers and managing your relationship with them is an important part of running a retail business.
Finding and Managing Suppliers
You can also get information about potential suppliers through our Secondary Market Research Service. Contact us through the Business Info Line or read more online:
Business Info Line
Secondary Market Research Service
Your business may need licences and permits from the federal, provincial and municipal levels of government.
In addition to the information you will find in this guide, you can use BizPaL—an online search tool—to find licences and regulations that may affect your business. You can also contact the Business Info Line to speak to someone about starting your business.
Permits and Licences Wizard
Contact the Business Info Line:
Your retail business may need to follow several different regulations depending on your products and activities, including:
The label you put on your product is an important way of communicating the value of that product to potential customers. You can use your labels to sell the benefits of your product to your clients, but you must follow labelling rules and standards.
The rules can be more restrictive for some types of products than for others. You should research the regulations and standards for your product before selling them.
There are labelling standards for everyday consumer products (like t-shirts, office supplies and pet food) that you need to know about before you begin selling products.
The Competition Bureau regulates labelling for most “non-food” consumer products. To learn more about the rules for packaging, labelling and advertising your products, contact the Competition Bureau directly or refer to the following link:
Contact the Competition Bureau:
The Competition Bureau also publishes individual guides on labelling requirements for certain business activities and consumer products. Refer to the following guides if you need more information on a specific aspect of labelling:
Labelling - Packaging Consumer Products (Non-Food)
Learn about your responsibilities when packaging and labelling consumer products (including pet food).
Made in Canada
Learn about the rules and regulations for using claims like "Designed in Canada" or "Made in Canada" to promote your products.
"Product of Canada" and "Made in Canada" Claims
If you are selling textile products such as clothes, carpets or upholstery within Canada, the product should be appropriately labelled.
The label on your products must show the fibre content information in both English and French. The Canadian manufacturer, processor or finisher must be identified either through a CA Number (for Canadian dealers only) or by listing their complete business name and postal address.
For specific textile labelling requirements, visit the Competition Bureau website.
Upholstered or stuffed products sold in Ontario must list the material used for filling and meet specific labelling requirements. Your product labels must be securely attached and made of a white durable fabric or synthetic material. Visit the Technical Standards and Safety Authority (TSSA) website for more details.
TSSA - Upholstered & Stuffed Articles
Your local health unit is the main contact for information on food safety. Local health authorities are responsible for carrying out food service inspections.
You should contact your local health authority and arrange an inspection of the premises/equipment/and processes to make sure your business is complying with provincial and federal legislation.
The following link provides a list of contact information for local health authorities that perform inspections on restaurants and food businesses in Ontario.
Local Public Health Contacts
In addition to contacting your local health unit, if you are involved in the production, service or processing of food products, you will need to comply with safety standards and labelling regulations from the Canadian Food Inspection Agency (CFIA) and the Ontario Ministry of Agriculture and Rural Affairs (OMAFRA).
Regulated products and sectors
Regulations for the food industry
When your business uses recorded music, you are responsible for obtaining the right licence(s) for that use. The Copyright Board of Canada works with individual copyright collective societies who provide music licensing. Contact the following two organizations for more information.
SOCAN is a not-for-profit organization that represents the performance rights of music creators and music publishers. They can help you learn about your obligations and obtaining the required license(s).
Society of Composers, Authors and Music Publishers of Canada
Re:Sound is the Canadian not-for-profit organization that represents the performance rights of artists and record companies, and provides the legally required license(s) for businesses. You can get help determining what licence(s) will be required, what the licensing process will be and how much it will cost.
In order to sell tobacco products, you are required to have a Tobacco Retail Dealer's Permit. If you plan on importing tobacco products, you will also need an importer's registration certificate.
Stocking or selling cigarettes that do not have an Ontario tax mark (yellow tear strip) is prohibited. Unauthorized possession of unmarked cigarettes may result in penalties, fines, imprisonment and forfeiture of the product.
Contact the Ministry of Revenue:
Tobacco Retail Dealer's Permit
If You Sell Tobacco - What Retailers Need To Know About Ontario's Tobacco Tax Rules
Find out what your responsibilities are for marketing, packaging or displaying tobacco products. You must also follow the regulations that apply to smoking in public places like offices, shops, or bars and restaurants.
The manufacture, sale, labelling and promotion of tobacco products is regulated in Canada. Find out what regulations will affect your business if you sell tobacco products.
Tobacco: Federal Regulations
If you sell tobacco products, you should also contact the municipality where the business will be operating for any local licences or permits that you may need.
Association of Municipalities of Ontario
To sell lottery or gaming products, you must be an authorized retailer.
Selling Ontario Lottery and Gaming Corporation (OLG) Products
If you plan on selling lottery products on behalf of the Ontario Lottery and Gaming Corporation (OLG), you must be registered with the AGCO.
Selling Break Open tickets
A licence is required from the Alcohol and Gaming Commission of Ontario (AGCO) in order to sell Break Open tickets.
AGCO - Break Open Ticket
If you have legal questions, contact a lawyer who deals with business regulations. The Law Society of Upper Canada's Lawyer Referral Service may be able to assist you in finding a lawyer, based on your needs.
Contact the Law Society of Upper Canada:
Law Society of Upper Canada's Lawyer Referral Service
Depending on your location and the type of products or services being offered, federal, provincial and/or municipal business taxes may apply.
If you sell goods and services in Ontario, you may need a business number to collect and remit the Harmonized Sales Tax (HST). Most businesses that make less than $30,000 in any 12 month period are not required to charge HST; however, you can register voluntarily and claim input tax credits. Speak with the Canada Revenue Agency (CRA) for more information.
Canada Revenue Agency – Business
Canada Business can help you find government financing options for your business. There are programs that apply to businesses across Canada, and others that apply only to businesses in Ontario. Use the Canada Business financing search tool or browse by type of financing.
You can also access Canada Business information through the ONe-Source online financing wizard. The wizard guides you through 3 easy steps to create a personalized list of results for Ontario business financing programs.
Contact the Business Info Line:
The success of any business starts by setting goals and managing the ups and downs of daily operations. Here are some key factors to consider when starting your business.
Marketing can help you determine the value of your product or service and communicate that information to customers. Depending on your market and its size, you can consider using flyers, business cards, brochures, newspapers, radio, TV, the phone book or the Internet. Keep in mind, a satisfied customer or a positive referral is often the best form of advertising.
When preparing your marketing and/or advertising material, there are regulations to follow. When you promote a product or service, your customers need to have enough information to make informed choices. You can get more information on advertising requirements from the Competition Bureau.
Contact the Competition Bureau:
Misleading Advertising and Labelling
Setting the right price is important in ensuring the success of your business. Here are a few questions you may want to consider:
When determining your fees, make sure you include the cost of your labour, the overhead and the expenses that will be incurred.
In the end, the right price for the service is the price that the consumer is willing to pay. Correct pricing decisions are often key to successful business management.
Having the correct business insurance can provide peace of mind. Contact an insurance agent to discuss your business insurance options, or to develop a plan that is right for your business.
You may also wish to contact your local chamber of commerce or industry association, as some organizations offer members lower rates on their business insurance.
The following list is included to remind you not to overlook the complex areas of business insurance. It is best, however, to discuss your specific requirements with your insurance agent.
Insurance for Your Small Business
If your business accepts cash, you and your staff should be trained to recognize counterfeit currency. From checking bank notes to preventing and reporting counterfeit bills, get free materials and information from the Bank of Canada.
There are many associations that may be of interest to you. It is not necessary to join an association, but some of the advantages include:
Examples of associations include, but are not limited to:
For other information that relates to starting your business, you can read the following guides:
Additional resources that may be of interest to you include:
You can find information on sales, inventories and operations costs for different retail categories on the Statistics Canada website.
Learn how to protect the personal information you collect and to prepare your staff to respond to enquiries and complaints from the public.
Access information about a specific industry’s performance, compare your business with the industry averages, and connect to buyers, distributors and partners through Industry Canada’s “Industries and Business” website.
Industries and Business
If you use a UPC or barcode system to scan your products at checkout, you may be interested in learning more about the Scanner Price Accuracy Voluntary Code. Retailers that participate in the program show a commitment to scanner price accuracy and have access to a national framework for dealing with scanner price accuracy issues.
Scanner Price Accuracy Voluntary Code
You can also find books, magazines and other relevant print material at business service organizations in your community. To locate a Canada Business Ontario (CBO) community partner, contact us through the Business Info Line at 1-888-745-8888.
Information contained in this document is of a general nature only and is not intended to constitute advice for any specific situation. Users concerned about the reliability of the information should consult directly with the source, or seek legal counsel.
Some of the organizations listed above are not subject to the federal Official Languages Act or the French Language Services Act of Ontario. Their services may not be available in both official languages.