Entrepreneur’s Paradise: Best Business to Start in Northwest Territories

By Maurice | January 16, 2025

Embarking on a new business venture in the Northwest Territories (NWT) offers a unique blend of challenges and opportunities, unlike any other region in Canada.

With a population of just over 44,920 people spread across a vast and diverse landscape, the NWT presents a distinctive market ripe for innovation and growth.

Did you know that the territory’s GDP grew by 2.9% in 2022, driven largely by the mining and public administration sectors? This statistic underscores the potential for entrepreneurial success in this robust and evolving economy.

1. Overview of the Northwest Territories Economy

The Northwest Territories economy has shown resilience in recent years. After shaking off the effects of the COVID-19 pandemic, economic activity, output, and employment expanded throughout 2021 and 2022.

You’ll find that the NWT’s economy has undergone a significant transformation. Over the past 15 years, it has shifted from relying on gold mining to becoming dependent on diamond mining. This change has consistently led Canada in economic growth during this period.

The territory’s GDP reached $4.4 billion in 2024. However, population growth has been modest, with an annualized 0.1% increase over the five years to 2024. Labor markets in the NWT have performed particularly well. You’ll be pleased to know that employment rates remain high, and unemployment rates are below historical averages.

The economy saw modest growth in 2023, boosted by higher-than-expected private and public investment. Despite a slight decrease in employment from 2022 to 2023, the labor market remains strong. As you consider starting a business in the NWT, keep in mind that the economy is diverse and offers various opportunities beyond its traditional mining sector.

2. Identifying Market Opportunities in the Northwest Territories

The Northwest Territories presents endless opportunities for entrepreneurs eager to launch a business. With a nurturing environment that fosters innovation and growth, it’s the perfect place to turn your ideas into reality.

Market opportunities and ideas for starting a business in Northwest Territories

One key area to consider is the natural resources sector. With vast oil and gas reserves, there’s potential for businesses that support resource extraction and processing.
The territory is also keen on promoting technology and innovation. You might explore opportunities to develop tech solutions for the unique challenges faced in the North.
Tourism is another promising sector. The NWT’s stunning landscapes and unique cultural experiences offer potential for adventure tourism, eco-lodges, or guided tour services.
Don’t overlook the film industry. The territory’s breathtaking scenery could be perfect for production companies or support services.
The NWT government provides various incentives and funding programs to support new businesses. You might find opportunities in sectors they’re actively promoting.
Consider the territory’s young, skilled workforce when planning your business. They could be an asset for knowledge-based or technical industries.

3. Criteria for Choosing the Right Business

Selecting the ideal business venture in the Northwest Territories requires careful consideration of market needs, legal obligations, and financial requirements. Your success hinges on thorough research and planning in these key areas.

Assessing Local Demand

Start by researching the local market to identify gaps and opportunities. Look for unmet needs in communities across the Northwest Territories. Consider surveying residents or analyzing existing market data to gauge demand for your products or services.

Pay attention to seasonal trends, as they can significantly impact business in the region. Tourism-related ventures might thrive in summer, while winter-focused businesses could fill a niche during colder months. Don’t overlook the potential of online sales and services, which can help you reach a broader customer base beyond local communities. This approach can be particularly valuable in remote areas with smaller populations.

Understanding Legal Requirements

Familiarize yourself with the specific regulations for starting a business in the Northwest Territories. You’ll need to register your business name with Corporate Registries if you’re operating under a name other than your own.

Be aware of licensing requirements for your chosen industry. Some sectors may have additional permits or certifications necessary to operate legally.

For non-residents, the Northwest Territories Nominee Program Business Stream offers opportunities but comes with specific investment criteria. You’ll need a minimum of $100,000 CDN equity for businesses outside Yellowknife.

Evaluating Startup Costs

Carefully assess the initial investment required for your business idea. Consider expenses such as equipment, inventory, licenses, and marketing. Factor in the higher costs often associated with operating in remote northern locations. Explore funding options available to entrepreneurs in the Northwest Territories. Look into government programs, grants, and loans specifically designed for northern businesses.

Develop a comprehensive business plan that outlines your startup costs, projected revenue, and break-even points. This will help you determine if your idea is financially viable and attract potential investors or lenders. Remember to account for ongoing operational costs, including utilities, rent, and employee wages, which may be higher in the North.

4. Major Industries in Northwest Territories

The Northwest Territories boasts a diverse economic landscape, with several key sectors driving its growth and prosperity. These industries capitalize on the region’s abundant natural resources and unique geographic features.

Mining and Natural Resources

The Northwest Territories is renowned for its rich mineral deposits. Diamond mining plays a crucial role in the territory’s economy. You’ll find world-class diamond mines like Diavik, Ekati, and Gahcho Kué operating here.

Gold, silver, and rare earth elements are also significant resources. The Nechalacho rare earth project is particularly noteworthy, as it’s the first rare earth mine in Canada.

The territory’s vast reserves of natural gas and oil contribute substantially to its economic output. The Mackenzie Delta and Beaufort Sea regions hold promising potential for future exploration and development.

Energy Sector

Hydroelectric power is a major component of the Northwest Territories’ energy sector. The Taltson and Snare hydroelectric systems provide clean, renewable energy to many communities.

You’ll find a growing interest in alternative energy sources. Wind and solar projects are gaining traction, especially in remote areas seeking to reduce diesel dependency. The territory is also exploring geothermal energy potential, particularly in the South Slave region.

Fishing and Trapping

Commercial fishing thrives in Great Slave Lake, where you can find whitefish, lake trout, and pike. The industry supports local economies and provides fresh fish to markets across North America.

Trapping remains an important traditional activity. Fur-bearing animals like marten, beaver, and lynx contribute to the territory’s fur trade. The fishing and trapping sectors also play a vital role in preserving Indigenous culture and knowledge.

Tourism and Recreation

The Northwest Territories offers unique tourism experiences that attract visitors from around the world. You can witness the spectacular Northern Lights, explore pristine wilderness, and engage in outdoor adventures.

Cultural tourism is on the rise, with opportunities to learn about Indigenous traditions and history. Yellowknife, the territorial capital, serves as a hub for tourists, offering amenities and guided excursions.

Fishing lodges, wildlife viewing, and aurora-watching tours are popular attractions that contribute significantly to the local economy.

Manufacturing and Handicrafts

While small in scale, the manufacturing sector in the Northwest Territories is diverse. You’ll find businesses producing everything from modular homes to specialty foods.

The handicraft industry is thriving, with artisans creating unique pieces that reflect the territory’s cultural heritage. Indigenous art, including carvings, beadwork, and clothing, is highly sought after by collectors and tourists alike. Local initiatives support the growth of this sector, providing training and marketing assistance to artisans.

Agriculture Sector

Although challenging due to the climate, agriculture in the Northwest Territories is growing. You’ll find greenhouse operations producing fresh vegetables, herbs, and flowers.

Small-scale farming and community gardens are becoming more common, improving food security in remote areas. The territory supports these efforts through various programs and initiatives.

Unique northern products like cloudberries and Labrador tea are gaining popularity in specialty markets.

Transport and Infrastructure

The transportation sector is vital for connecting communities and supporting other industries. You’ll find a network of highways, including the iconic Dempster Highway, linking remote areas.

Air transport is crucial, with numerous regional airports facilitating travel and cargo movement. The Mackenzie River serves as an important waterway for transporting goods during ice-free months.

Investments in telecommunications infrastructure are ongoing, improving internet connectivity and supporting the growth of digital industries in the territory.

5. Business Ideas with Potential in the Northwest Territories

The Northwest Territories offers unique opportunities for entrepreneurs. From geological services to eco-tourism, there are diverse business ideas that can thrive in this region’s distinctive environment and economy.

Geological Survey Services

The Northwest Territories is rich in mineral resources, creating a demand for geological survey services. You can start a business providing mineral exploration and mapping services to mining companies.

Your expertise will be valuable in identifying potential mining sites and assessing their viability. Invest in advanced surveying equipment and develop partnerships with local communities to gain access to promising areas.

Offer specialized services like geophysical surveys, geochemical analysis, and 3D modeling of mineral deposits. Stay updated on the latest technologies in remote sensing and data analysis to give your clients a competitive edge.

Environmental Impact Consulting

With an increasing focus on sustainable development, environmental impact consulting is a promising business opportunity. You can offer services to assess the environmental effects of various projects in the Northwest Territories.

Your expertise will be crucial for businesses and government agencies planning new developments. Develop skills in conducting environmental assessments, wildlife surveys, and habitat restoration plans.

Build a team of experts in fields like ecology, hydrology, and climate science. Offer services such as environmental impact statements, regulatory compliance assistance, and sustainable development planning.

Renewable Energy Installation

The Northwest Territories is fostering growth in clean energy, creating opportunities for renewable energy businesses. Here are key areas to focus on:

Solar Panels: Emphasize solar panel installation, increasingly viable even in northern regions.
Wind Turbines: Offer wind turbine installation for homes and businesses.
Energy Storage: Develop expertise in energy storage to manage renewable energy’s intermittent supply.
Supplier Partnerships: Partner with suppliers to stay competitive and updated on renewable technologies.
Energy Audits: Conduct energy efficiency audits for homes and businesses to address high energy costs.
Building Assessments: Provide assessments of building envelopes, heating systems, and electrical usage.
Efficiency Reports: Deliver reports with recommendations to improve energy efficiency and cut costs.
Thermal Imaging: Use tools like thermal imaging cameras and energy modeling software.
Extra Services: Offer air sealing, insulation upgrades, and LED lighting retrofits.

By targeting these areas, your business can meet the rising demand for clean energy while contributing to a sustainable future in the Northwest Territories.

Fish Processing Facility

The Northwest Territories offers abundant freshwater fish, making it an ideal location to start a fish processing facility and add value to the local fishing industry. Here are the key steps to succeed:

Focus on Popular Species: Process high-demand fish like whitefish, lake trout, and northern pike, known for their quality and taste.
Invest in Modern Equipment: Equip your facility with state-of-the-art tools to maintain quality and meet food safety standards.
Secure a Steady Supply: Build strong relationships with local fishers to ensure a consistent supply of fresh fish. Reliable partnerships are key to long-term success.
Explore Market Opportunities: Target local restaurants, grocery stores, and export markets to maximize sales.

Opening a Fishing Gear Supply Store can also complement your processing facility. Stock items like fishing rods, nets, and tackle for fishers in the region.

Start a Fishing Gear Supply Shop: Diversify by stocking equipment suited to regional needs, including ice fishing gear for winter months.
Offer Personalized Expertise: Provide advice based on local fishing conditions to boost customer satisfaction and establish your store as a go-to resource.
Add a Repair Service: Offer fishing equipment repair to create additional income and value for customers.

Fur and Leather Products

The Northwest Territories has a long tradition of fur trapping. Start a business creating high-quality fur and leather products using locally sourced materials.

Design and produce items like fur-lined gloves, leather jackets, and traditional handicrafts. Focus on ethical sourcing and sustainable practices to appeal to environmentally conscious consumers.

Develop partnerships with local trappers and Indigenous artisans. Explore online marketplaces to reach customers beyond the local area who are interested in authentic northern products.

Eco-Lodge

The unique natural beauty of the Northwest Territories makes it an ideal location for an eco-lodge. Create a sustainable accommodation option for tourists seeking an immersive northern experience.

Design your lodge to blend with the natural environment and minimize its ecological footprint. Offer activities like guided nature walks, wildlife viewing, and cultural experiences with local Indigenous communities.

Implement renewable energy systems and waste reduction strategies. Market your eco-lodge to adventure travelers and eco-conscious tourists looking for authentic northern experiences.

Northern Lights Viewing

The spectacular aurora borealis attracts visitors from around the world. Start a business offering specialized northern lights viewing experiences.

Invest in comfortable, heated viewing facilities away from light pollution. Provide high-quality photography equipment and tutorials for guests to capture the aurora.

Offer packages that include transportation, warm clothing rentals, and hot beverages. Consider partnering with local accommodations to create all-inclusive Northern Lights experiences.

Local Artisan Shop

Showcase the rich artistic traditions of the Northwest Territories by opening a local artisan shop. Feature a diverse range of handcrafted items from Indigenous and local artists.

Stock unique products like soapstone carvings, beadwork, and traditional clothing. Provide information about the artists and the cultural significance of their work.

Host workshops where visitors can learn traditional crafting techniques. Develop an online presence to reach customers interested in authentic northern art and crafts from around the world.

6. Steps To Start a Business in Northwest Territories

Embarking on a business venture in the Northwest Territories offers a thrilling opportunity filled with potential and promise.

To begin, you’ll need to:

Develop a solid business plan: This document will outline your goals, target market, and financial projections.
Consider joining local business networks: The Northwest Territories Nominee Program offers opportunities for entrepreneurs to connect and grow their businesses.
Choose a business structure: Options include sole proprietorship, partnership, or corporation. Each has its own legal and tax implications, so consider consulting a professional.
Secure financing: The Northwest Territories offers support programs that provide funding and resources to entrepreneurs. Explore these options to kickstart your business.
Register your business name: Ensure your chosen name is unique and legally protected by registering it with the territorial government.
Obtain necessary licenses and permits: Requirements vary depending on your industry and location. Research local regulations to ensure compliance.
Set up your business location: Whether you’re leasing space or working from home, make sure it meets zoning requirements.
Open a business bank account: Separating personal and business finances simplifies accounting and tax preparation.

Remember, starting a business takes time and effort. Stay focused on your goals and don’t hesitate to seek guidance from experienced mentors or business advisors.

Frequently Asked Questions

Starting a business in the Northwest Territories involves specific steps, licenses, and funding options. Entrepreneurs can benefit from various resources and industries suited to the region’s unique economic landscape.

To get a business license in Yellowknife, you need to apply through the City of Yellowknife’s Development Services Division. You’ll need to provide details about your business and pay the appropriate fee.

The process typically takes 2-3 business days. Make sure your business complies with zoning regulations and health and safety standards.

To start a business in the Northwest Territories, first develop a business plan. Choose a business structure and register your business name with the territorial government.

Obtain necessary licenses and permits. Set up your finances, including opening a business bank account. Consider registering for GST/HST if your revenue exceeds $30,000 annually.

The Northwest Territories offers various funding options for new businesses. You can explore grants and funding programs provided by the territorial government.

Financial institutions offer business loans. Consider microloans from community organizations or investment from local angel investors.

The Northwest Territories encourages entrepreneurs in several industries. Tourism, renewable energy, and traditional crafts are growing sectors.

Mining and resource extraction continue to be strong. Tech startups focusing on northern solutions are also gaining traction. Consider businesses that cater to the unique needs of northern communities.

The Northwest Territories provides several resources for business education and training. Aurora College offers business programs and workshops.

Prosper NWT provides guidance and resources for entrepreneurs. Local chambers of commerce often host networking events and seminars for business owners.

Starting a sole proprietorship in the NWT is relatively straightforward. You need to register your business name with the Corporate Registries office if it’s different from your legal name.

Obtain any necessary licenses or permits for your specific business type. You don’t need to file separate tax returns for your business, as income is reported on your personal tax return.

Resources On Business to Start in Northwest Territories

Government Resources:

Industry Resources:

Chamber of Mines
NWT Tourism
Fisheries Joint Management Committee
Indigenous Businesses and Partnerships
NWT Chamber Of Commerce
Arctic Energy Alliance

Other Resources:

About the author

Maurice

Maurice (Moe) Muise learned the ins-and-outs of government while an employee of the Government of Canada in Ottawa for 10 years. His current focus is helping small businesses in Canada to identify and maximize funding to grow their business.