Cross-border shopping by Canadians in the United States rose between 2006 and 2012, but even with those increases, purchases from the United States were between 1% and 2% of total Canadian retail sales, according to recent findings from Statistics Canada.

In a new study from StatsCan, which used data derived from a range of survey and administrative data sources to provide an upper and lower bound estimate of the exact economic impact of cross-border shopping, shopping by Canadians in the United States was an estimated $4.7 billion in 2006. Since then, annual increases, with the exception of a decline in 2009, have taken the total to $8.0 billion in 2012, 72% higher than in 2006.

Overall, retail trade sales in Canada also increased every year from 2006 to 2012 except in 2009, when there was a 2.9% decline. Even with that one-year drop, annual sales rose from $389 billion in 2006 to $468 billion in 2012. Comparing the two figures, cross-border shopping by Canadians in the United States accounted for 1.7% of total Canadian retail sales in 2012.

The study examines three spending scenarios, low, medium—the one cited above—and high expenditures. In these scenarios, the annual total for cross-border shopping ranged from $5.9 billion to $10.8 billion in 2012, or between 1.3% and 2.3% of total retail sales.

About three-quarters of Canadians live within 160 kilometres of the Canada–US border. Therefore, many consumers use their relatively easy access to the United States as a shopping option. This is especially true for those living right along the border when it comes to shopping for goods that are traditionally cheaper in the United States, like gasoline and groceries.

Cross-border shopping estimates are composed of four elements: spending on same-day trips; spending on overnight trips; postal and courier imports; and motor vehicle imports. Since 2006, both same-day and overnight trips have risen steadily, with the exception of 2009. In 2012, Canadians made almost 56 million visits to the United States, up 38% from 2006.

Every category, except motor vehicle imports, has also seen significant growth in its share of cross-border shopping. The annual amount brought back to Canada from same-day trips grew from $370 million in 2006 to $844 million in 2012. At the same time, the annual total from overnight trips doubled from $1.8 billion in 2006 to $3.6 billion in 2012.

Goods imported into Canada from abroad by post and courier were also factored into the estimates of total cross-border spending. The value of these goods increased from 2006 to 2012 and was estimated at $3.1 billion in 2012, up 12.7% from a year earlier and 50% higher than in 2006.

Motor vehicle imports saw both increases and declines over the study period. Included in this category are purchases of passenger vehicles, trucks, buses, multi-purpose vehicles, snowmobiles, motorcycles and trailers. Motor vehicle imports totalled $426 million in 2006 and then more than doubled to over $1 billion in both 2007 and 2008. By 2012, they had declined to a level almost identical to that in 2006.

In 2012, overnight trips (45.3%) and goods delivered from abroad by post and courier (38.9%) accounted for most of the cross-border shopping total, while same-day trips (10.5%) and motor vehicle imports (5.3%) made up the rest.

Several factors can contribute to the growth in cross-border shopping. Among them is the relative strength of the Canadian dollar over the study period, as well as price differentials, changes in retailer landscape, duty-free limits, tax changes and economic conditions.