Hold it a bit, until you are through with reading this post if you are a first time exporter. Yes, don’t start your first export yet, if you do not understand the basic things needed to be up and running an exportation business. Without proper guidance, you will be exposed to a 90% possibility of losing your hard-earned investment.
At this point, there is a likelihood of being unsure how to start, where to start from, what to export, what to put in place, or who offers you professional guides. Above all, what happens to you or your consignment should they arrive at their destination abroad. Most of all, urgency? What medium should be best? Export by Air Freight? by Sea Shipping?
All aspect and stages matter a lot in this business and deserve to be taken with all carefulness.
Would you find these essential tips useful? Why not check it out later. This post was put together as a follow-up post.
Remember, so much money is involved, you don’t want to lose them cheaply. The challenging nature of importation and exportation businesses cannot be over-emphasized.
That being said, it is imperative to gird your loins well enough to avoid errors yielding as a result of unpreparedness. It becomes important because this is an international business. At such, it demands that everyone, whether experienced or first time exporters have a deep understanding of all processes. You have to understand the market you are exporting to. There are several rules and regulations to be adequately acquainted with through consistent study.
We put together 8 essential points you need to act on before you start export business.
Understand All Export Documentation Required
In order to avoid delay in shipment, avoid increased cost of shipping, or avoid a repeat in a supposed foregone process of exportation, you must understand documentation requirement.
As an importer or an exporter, you can never complete your business without going in contact with customs clearance. Regardless of the varying countries, every country has a requirement that must be met, checked and approved for movement. A wrongly labelled consignment, intended for Canada, for example, whereas its destination is the US, experiences a high chance of loss.
Before you start an export business, you must be very careful with processes. You really need to acquire knowledge and be well acquainted with the Harmonized System (HS) codes. It helps importers and exporters classify their goods correctly.
Also ensure proper labelling of your consignment, if you do not want to encounter a delay in shipping, avoid high cost of shipping or repeat the processes over again, thereby wasting precious time.
To avoid the unexpected, you most especially need to pay attention to paperwork and include all necessary documentation.
Check, Organise and Manage the Export Data
Everything about freight forwarding has gone automated. In the digital age, quite a lot is taking a new and better turn. Understanding this is as good as knowing how to manage and organise your export-related data, which can play a major role in running a successful shipping business.
The ultimate effect of this adoption is that with cloud-based data management, you have your data more properly stored. This guarantees security which helps eliminate access to your data by unauthorized persons, wielding off unwarranted damages.
This has drawn a thick line, placing the manual paper-based process of data management in the place of extinction. So, with the digital atmosphere, you are free from errors and time-wastage processing data. It saves a lot of time, money and effort, while giving aid to increase in productivity.
Interprete The HS Codes Effectively
HS Code stands for Harmonized System Code. It was developed by the World Customs Organization (WCO) as a multipurpose international product nomenclature that describes the type of good that is shipped. It became a tool for international trading owing to general acceptability by organizations around the world.
Though it is tricky to interpret, even as an experienced exporter, this does not pave the path for non-compliance, as the Codes are overtly required for your export business.
The effect of inefficiency in knowing or interpreting the HS Code engenders improper usage. This, as a result, can be responsible for improper issuance of customs tariff, therefore increasing the cost of the transactions. Apart from that, improper usage of the HS Code can land a careless exporter in serious legal penalties for “non-compliance, misleading or misdeclaration.” Most of the time, it leads to the seizure of goods, thereby defeating the very purpose of the exporter’s business.
So, as a first time exporter, you’d want to be careful and well informed. Involve an expert on the field, or contact a qualified professional Customs Licenced Agent for advice on the correct HS codes to use.
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Acquaint Yourself with the Export Rules
Export Rules and Regulations vary by countries. As a first time exporter, you need to have an understanding of the legal and compliance regulations of the country(ies) you are dealing with. You can find most of this information on the respective government organization’s website.
You want to ensure quality foreign trade relationship with a country, then it is essential that you get along with their policies, and ensure to avoid any legal issues.
To ensure that, try to get a deeper understanding of their legal and compliance regulations. You can find most of this information on the respective government organization’s site. They maintain a list of denied parties with which you can’t indulge in any export business unless you have a valid license.
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Check the Applicable Tariff and Fees Beforehand
Whether you are an experienced or first time exporter, once your consignment clears the customs in the destination country, there are additional fees charged. These fees are known as Applicable Tariff and Fees. There is a need to understand who pays for what charges therefore, necessitating the importance of checking the applicable tariff and fees ahead of time.
One other notable effect of this is that it mostly increase the cost of your product and create a scene of competitiveness in the market. This is why you must know your final cost, weighed in along with the current exchange rates that are applicable for that market.
The tariff rates on international shipments usually depend either on the country’s bylaws or on the globally recognized HS codes.
Exportation business in Nigeria is a lucrative business. One of the reason is that the profit you are making from the business is in hard currency (Dollars, Pounds or Euro). The problem here is that some people want to go into exportation business but they do not know the product they can export apart from the oil-related product or where to export and how they can export this product in other to make profit.
As a first time exporter, you won’t want to begin your journey recording losses as a result of limited information or inadequate guidance. There is actually no need starting off without first acclimatizing with industry best standard. The above points are one of, first things to put into consideration, to familiarize with the entire process of exportation business.
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