What You Need to Know About The Canadian Digital Adoption Program for Your Small Business

Can You Really Get a FREE Website?

You may have heard or seen ads for getting a “free business website” thanks to the Canadian Digital Adoption Program (CDAP) which was announced in March 2022 to help Canadian small businesses grow their online presence in an attempt to bolster the Canadian digital economy and create more jobs for young Canadians (according to a statement from PM Justin Trudeau)

The goal is to partner Canadian small businesses with Canadian students and recent grads registered on the program’s marketplace as “digital advisors” to help existing businesses grow their online presence and leverage technology to meet short and long term goals. Through the CDAP the Canadian government will invest $4 billion dollars over four years to support up to 160,000 small businesses develop and implement a comprehensive business plan to adopt digital tools and technologies.

There are two available grants and funding programs, however I will only cover the one that is currently still accepting applications and geared at smaller enterprises that want to adopt an e-commerce strategy to enable them to make sales online, directly from a website called the “Grow Your Business Online” grant. 

$2400 Grant to Help Your Business…

• get online
• increase sales
• adopt security software
• connect with customers
• improve social media marketing
• improve user experience for online customers

This quick questionnaire available on the Government of Canada website can help assess whether you are eligible and which program would be best for you (at the time of publication, the Boost Your Business Technology grant is closed for applications)

In order to apply, you must meet the following requirements:

• Are a registered or incorporated business
• Have at least one employee (employed at least 3 months) OR $30,000 in annual revenue over a 12 month period (meaning you have filed taxes on it)
• Be a for-profit business

The following business types cannot apply:

• Chains, franchises, charities, wholseales, MLM and online resellers 
• Brokerage firms (real estate, insurance, investments, etc)

Getting Started

You will need to apply through the available local and regional service providers or if you are an Indigenous business owner, the Canadian Council for Aboriginal Businesses. Most provinces and territories have one service provider, however BC and Ontario have multiple partners including two non profit organizations in the small business digital space Alacrity Canada and Digital Main Street, that offer training and resources for Canadian small businesses.

Be sure to have your documents and business information handy. If you are applying for the grant you will need to know:

• The business name
• The business owner’s name and contact
• The business type (corporation, sole proprietorship, partnership, etc)
• The year the business was created
• Number of employees
• Last year’s annual revenue
• Business numbers including provincial and federal registrations
• GST number (if applicable)
• Articles of incorporation (if applicable)

You can apply through Digital Main Street if you reside in any province or territory other than Qubebec. I found their site and application process to be helpful and intuitive and less intimidating that the other sites I looked at. Plus they provide resources for all Canadian small business that you might find interesting.

How It Works

For starters, you’ll need to invest the capital upfront and the grant is simply a reimbursement of eligible costs, so be sure to review what is and isn’t covered. 

You will need to be approved for the grant as any costs associated with digital adoption and e-commerce paid prior to your program approval are ineligible for reimbursement including domain renewal and e-commerce fees.

What’s Covered?

Note that if you already have an e-commerce site and are hoping to use the funds for digital marketing you must be able to tie it into a larger e-commerce implementation plan as the funds cannot be used solely for marketing purposes. 

The key items you’ll want to focus your spending on are:

E-Commerce Software

E-commerce software including payment processing, inventory management and/or booking/scheduling tools, customer relations & data management, email marketing software, cyber security, customer loyalty or rewards, website usability and accessibility plugins, etc. 

You will need to make sure the software is directly tied to or integrated with your website to ensure it qualifies as part of your e-commercy strategy. If the software is purchased in combination with hardware that integrates with your e-commerce strategy, it is eligible for partial (20%) reimbursement. 

Since most e-commerce software is offered as software-as-a-services (SaaS), you will likely need to enroll in a subscription service with monthly or annual terms. The grant will reimburse up to $2400 if you prepay for a monthly subscription, plus you will usually get a discounted rate from the supplier. 

Consulting and Contractor Fees

Independent contractor fees for services related to implementing an e-commerce strategy, including social media and marketing, SEO, listing products and services, web development and design* (*for existing websites it must relate only to the functionality not aesthetics of the website), inventory and logistics management systems, data entry/migration, employee training, etc.

Independent consultant fees for services related to the sale of goods and services online such as assessments, strategies, planning, relating to the digital economy, cyber security, e-commerce operations, software and technology, digital marketing and customer engagement online

Startup Costs

Implementation fees including one time setup or registration fees, back office supplies for to support e-commerce, up to 20% of hardware relating to e-commerce (and 20% of any software required for hardware)

Key ineligible costs to be aware of

• Internet connectivity and renewals of digital services or subscriptions
• Puchase of land or vehicles, mortgage, loan or rent payments
• Cost of owner/employee salaries for executing the project
• Signage, printing, shipping service fees, redesign or rebranding, 
• Any purchases or fees for service made prior to grant approval

The full list of ineligible costs is available here, but use your common sense on whether or not costs are directly related to implementing an e-commerce business plan. 

My Thoughts on The Program and Who its For

The “Grow Your Business Grant” available through the Canadian Digital Adoption Program is meant to support two types of Canadian individuals in addition to the general Canadian economy: small business owners and unemployed Canadian youth. From reading between the lines, I see the program as being targeted toward local business owners who provide goods or services to their communities in order to expand the local economy. I also see it as harnessing the power of today’s youths and their natural understanding as well as fascination with the digital age to introduce them to the workforce in a way that avoids adjustment issues¹ due to the expectations Gen Z attitudes place on traditional employers.

I think it’s a good idea to take advantage of the vast knowledge gaps now appearing in the workforce, resulting from the speed of technological advances in the digital age in an effort to pair up the digitally literate with those who haven’t quite kept up. Whether or not it will improve the economy or if it’s a good use of resources, I guess time will tell.

Are You A Business That Has Benefitted From The CDAP?

We want to hear from you! Let us know in the comments if you’ve made use of the grant or are planning to. Don’t forget to subscribe to our newsletter to be the first to know about opportunities like these!

Read Next: How I Would Leverage the Grow Your Business Grant