Retail business guide

Table of contents

Introduction
Getting started
Regulations
Taxation
Financing
Other resources

Introduction

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.

Read online:
Franchising

Getting started

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:

  • Find out what licences and regulations apply to your type of business
  • Choose a business structure and register or incorporate your business
  • Determine if you will need to collect and remit HST

Our business start-up guide will give you more information on these steps and other basic requirements for starting a business in Ontario.

Read online:
Starting a Business

Choosing a location

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.

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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.

Read online:
Association of Municipalities of Ontario

Selecting your inventory

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.

Read online:
Inventory management

Selecting your supplier

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.

Read online:
Finding and managing suppliers

You can also get information about potential suppliers through our secondary market research service.

Contact us or read more online:
1-888-576-4444
Secondary market research service request

Regulations

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 the Canada Business Permits and Licences Search, powered by BizPaL, to find licences and regulations that may affect your business. You can also contact us to speak to someone about starting your business.

Contact us:
1-888-576-4444
Permits and licences search

Your retail business may need to follow several different regulations depending on your products and activities, including: 

General product labelling

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.

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Product Labelling

Consumer product labelling (non-food)

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:
1-800-348-5358
Labelling corner

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).

Read online:
Guide to the Consumer Packaging and Labelling Act and Regulations
Consumer packaging and labelling

Made in Canada

Learn about the rules and regulations for using claims like "Designed in Canada" or "Made in Canada" to promote your products.
Read Online:
"Product of Canada" and "Made in Canada" claims

Labelling textiles

If you are selling textile products such as clothes, carpets or upholstery within Canada, the product must be labelled appropriately.

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.

Read online:  
Guide to the textile labelling and advertising regulations

Labelling of upholstered and stuffed articles

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. You would also need to meet specific labelling requirements when selling these products as second-hand items. Visit the Technical Standards and Safety Authority (TSSA) website and the Health Canada website for more details.

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TSSA - upholstered & stuffed articles
Health Canada - Industry Guide to Second-hand Products

Food safety and labelling

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 contact information for local health authorities that perform inspections on restaurants and food businesses in Ontario.

Read online:
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 Food and Rural Affairs (OMAFRA).

Contact CFIA:
1-800-442-2342
Regulated products and sectors

Contact OMAFRA:
1-877-424-1300
Regulations for the food industry

Music licence

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.

Society of Composers, Authors and Music Publishers of Canada (SOCAN) Music Licence

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).

Contact SOCAN:
1-800-557-6226
Tariffs & forms - Music in a business

Re:Sound Music Licensing Company

Re:Sound is the Canadian not-for-profit organization that represents the performance rights of artists and record companies, and provides the legally required licence(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.

Contact Re:Sound:
1-877-309-5770
Re:Sound

Tobacco Retail Dealer's Permit

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:
1-866-ONT-TAXS (1-866-668-8297)
Tobacco Retail Dealer's Permit
Illegal Tobacco

Smoke-Free Ontario

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.

Contact your local Public Health Unit: 
Public Health Unit Locations 
Smoke-Free Ontario – How the Act Affects You

Tobacco Sales

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.

Read Online:
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.

Contact AMO:
1-877-426-6527
Association of Municipalities of Ontario

Lottery tickets

To sell lottery or gaming products, you must be an authorized retailer.

Selling Ontario Lottery and Gaming Corporation (OLG) products or selling Break Open tickets

If you plan on selling lottery products on behalf of the OLG, you must be registered with the AGCO. A licence is also required from the Alcohol and Gaming Commission of Ontario (AGCO) in order to sell Break Open tickets.

Contact AGCO:
1-800-522-2876
Lottery retailer

Legal questions

If you have legal questions, contact a lawyer who deals with business regulations. The Law Society of Upper Canada's Law Society Referral Service may be able to assist you in finding a lawyer or paralegal, based on your needs.

Use online:
Law Society Referral Service

Taxation

Depending on your location and the type of products or services being offered, federal, provincial and/or municipal business taxes may apply.

Read online:
Taxation guide

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.

Contact CRA:
1-800-959-5525
Canada Revenue Agency

Financing

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.

Search online:
Canada Business: Government grants and financing

Other resources

Managing

From day-to-day operations to long-term planning, learn how to manage your business efficiently.

Associations

If you are interested in finding an association, use our secondary market research service request and have us search for one based on your needs.

Industry specific links

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 at 1-888-576-4444.