Regulation & Public Policy

Crossover:
A Canadian Startup’s Guide to Navigating US Trade

Despite robust market demand, niche retailers such as Kigurumi are one of many players at a critical crossroads as the US launches its trade war with the rest of the world.

By Jeremy Osborn | Published 1 week ago | About a 6 minute read

Image: Kigurumi

Marc Beaupré never imagined his passion for high-end cosplay costumes would land him in the middle of international trade politics. Yet the founder of Kigurumi (colloquially called "Kigu" by fans) — a 14-year-old, Montréal-based company specializing in premium, Japanese-inspired onesies — now finds himself daunted by the new costs and complexities of cross-border business expansion.

"We have a pretty significant footprint in New York already with the huge cosplay and anime communities in NY and NJ, and would like to explore committing further to the state," Beaupré told me during a recent interview.

But it may be bad timing: With the US administration's dramatic 125% (at press time) tariffs on Chinese imports taking effect this week, small specialty retailers such as Kigurumi face difficult decisions about US market crossover.

Consciously crafted costumes

The company's meticulously crafted onesies have developed a cult following among cosplay enthusiasts who appreciate their durability and authentic Japanese styling — qualities that set them apart in an industry often dominated by cheap, disposable costumes.

A software engineer by training, Beaupré brings an analytical mind to his business — paying attention to every product detail.

"My background in software taught me to be methodical and precise. I am passionate about applying that same type of thinking to our manufacturing process," he said. "What we're creating isn't just a costume — it's an experience of comfort and quality that lasts. Every stitch is designed to bring joy; and that philosophy extends to how we approach our business expansion, as well."

Beaupré says sustainability through durability has become a cornerstone of Kigu’s business philosophy: "I believe true sustainability starts with creating products that aren't disposable. We focus on making items that last for years, not just a single convention or Halloween."

This commitment to quality extends to his supply chain management.

"I personally know our suppliers in China and have visited the factory multiple times," Beaupré said. "Building these relationships means I can ensure our manufacturing standards are maintained and working conditions meet our expectations. They're very open to collaborating on new approaches and materials, as well — particularly on sustainability."

"I inspect samples personally and test every new design myself before it goes to production," he added. "If I'm not comfortable wearing it all day, it doesn't get approved."

Staying afloat in a volatile market

The new US tariffs have accelerated Beaupré's interest in bringing some operations to New York.

"Getting clobbered with these new tariffs is forcing us to consider alternatives," he admitted. "Moving some manufacturing to New York would not only help with tariffs but could open new doors for sustainability experimentation."

Kigu’s sustainability plans extend beyond durability: Beaupré says the company is exploring non-toxic dye certification, as well as increasing circularity through take-back and recycling programs — both efforts that are practically unheard of in the costume industry.

"Most costumes end up in landfills after a single use," he noted. "We're designing our products with eventual disassembly and material recovery in mind. A New York operation could serve as our sustainability innovation lab."

The cosplay market has exploded in recent years. New York and New Jersey represent substantial markets for these products, with anime conventions regularly drawing tens of thousands of attendees. But what makes New York particularly appealing for Beaupré isn't just the customer base.

"Access to graduates from the Fashion Institute of Technology, exposure during NY Fashion Week, and proximity to world-class design houses and cosplay conventions would be invaluable for our product development," he explained.

The historical context adds another layer of opportunity. New York's garment district was once the beating heart of US apparel manufacturing, with infrastructure and expertise developed over generations. Though diminished from its heyday, the innovative foundations remain for niche operators willing to invest.

It’s up to states to re-embrace foreign business

Despite these advantages, Beaupré hesitates. Like many Canadian businesses eyeing expansion into the States, he's found a surprising lack of targeted support for companies in his position.

"We're a very small business. If I could have access to a grant or a hybrid loan grant with some portion forgivable, I could really consider it in earnest," Beaupré said, after discussing the multiple logistical challenges of cross-border operations.

When pressed on specifics, he offered a surprisingly modest assessment: "A couple of hundred thousand in grants, tax breaks and other financial incentives would be enough — and I'm confident I could return that multiple times over in jobs, IP and innovation in NY."

Beaupré has explored several of New York's business development programs, including the New York Forward Fund and Empire State Development's Global NY initiative, but found they weren't tailored to businesses in his unique position.

"As a comfiness expert, I understand that one size doesn't fit all," Beaupré said with a smile. "The same applies to business incentives. What works for a tech startup might not address the needs of a specialty garment manufacturer with specific, cross-border logistical challenges."

The ball now appears to be in New York's court. As the state continues its long-standing efforts to revitalize manufacturing and support creative industries, companies such as Kigurumi represent exactly the kind of business that could thrive in its ecosystem. The question remains whether, in the face of prohibitive tariffs, blue states will develop more aggressive incentive structures to capture these opportunities before they're lost to other regions and countries.

Rebuilding wartime bridges

Beaupré isn't alone in his dilemma. Other Canadian manufacturers considering US expansion have have similarly noted that without targeted support it can be easier said than done. Despite the state's strong manufacturing legacy and creative industry presence, its incentive programs for small to mid-sized foreign companies appear to lag behind the targeted recruitment efforts many businesses have come to expect when considering significant cross-border investments.

Canadian businesses benefit from numerous federal export incentives in their home country — including the CanExport program that provides up to $75,000 in funding to explore new international markets, and Export Development Canada's financing solutions that offer working capital and risk mitigation. The Trade Commissioner Service also delivers market intelligence and introductions to qualified contacts abroad. In stark contrast, New York State's economic development programs lack targeted pathways specifically designed for small to mid-sized Canadian specialty manufacturers. While the START-UP NY program offers tax-free zones near colleges and the Excelsior Jobs Program provides tax credits for job creation, these broad initiatives fail to address the unique challenges that small and growing international businesses face when establishing US operations — leaving companies such as Kigurumi without clear support during a critical expansion juncture.

As global markets for specialty retail continue evolving amid uncertain trade conditions, Kigurumi’s story illustrates a broader economic narrative playing out across North American borders. Beaupré's company represents precisely the type of innovative, growth-oriented business that can revitalize manufacturing districts and create specialized employment opportunities. The modest investment needed — when measured against the potential returns in jobs, innovation and economic activity — highlights a compelling case for nimbler, more targeted, perhaps even personalized incentive structures.

For New York and similarly positioned states, the opportunity to capture these entrepreneurial ventures depends on recognizing that in today's competitive landscape, traditional approaches to business recruitment may no longer suffice. The question remains whether policymakers will adapt quickly enough to secure these economic opportunities before they find homes elsewhere.

Jeremy Osborn

Jeremy Osborn is a NYC-based entrepreneur and senior consultant with a background in tech, marketing and communications, strategy, governance and sustainability.

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Entrepreneurship