This was a period of great change and immense promise in trade, built on Glasgow's rapidly expanding industrial sector and encouraged by the American Revolution in 1776, which decimated the tobacco trade. The West Indies had already become the chief destination of Glasgow colonial exports, especially Glasgow linen, and Dundee "slave cloth" brought through the Forth & Clyde canal (opened 1775), which also facilitated exports to Europe. However, without tobacco, this trade stagnated: the residue went chiefly to Holland, while Baltic goods were bought with earnings from exports to the West Indies, occupying more shipping space than those to the whole of Europe.
This relative decline in direct exports to northern Europe forced a change in mercantile tactics. Though popular in North America, printed cottons were not welcomed in Northern Europe and Glasgow had little experience in the warm south. Glasgow therefore concentrated on Canada, an excellent market for household goods and clothing, and producer of excellent timber which, with preferential duties, rivalled the Baltic product and further diminished European trade. All Glasgow's large ships were built there (600-tonners by 1830), forming the foundation for the development of Glasgow shipping lines.
Significantly, cotton manufacturers now turned towards India and the Far East when the East India Company's monopoly ended: the first ship with cotton exports was sent eastwards by Finlay & Co in 1816. This period also saw the rapid expansion of coastwise exports with the development of steamers from river craft (1812) to coastal-traders, which supported and depended on the great Glasgow "warehouses" that supplied the household goods and the coal for the Highlands and Islands of western Scotland.