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Where do I start(Import/Export business)?
yusiye
subscriber Posts: 3 Member
I was recently talking to my friend about start a import/export business. I`d like to pick a book or something to start get an overview on the subject. Where should I start?
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on How to Start an Import/Export Business. It is
a pretty lengthy article and pretty interesting from what I
read.
http://www.entrepreneur.com/startingabu ... nessideas/
We`re always looking for good suggestions on how the improve the site and on topics you`d like us to cover.
boberwin6/9/2009 4:08 PM
As an importer you will be exposed to a fair deal of risk, primarily inventory (especially when dealing with food items with short expiration dates). Risk can be minimized by taking orders and having customers pay you ahead of time, but that's obviously an ideal scenario. If you're just starting out, you'll find it extremely difficult to get customers to part with their money prior to seeing the products (until trust is developed). To get volume discounts + minimize your shipping costs, as well as cancelled orders from clients, you'll often find yourself sitting on excess goods which you may have trouble selling. Initially you may not be able to afford a warehouse, and running this type of business out of your home can be extremely inconvenient.
You do not need to have your business registered in the USA, since you can purchase directly from the distributors/wholesalers and have the products shipped to South America. Depending on what it is that you're importing you will need an import license - and these can be costly (I would inquire with your local government to see what type of licenses you may need). Now keep in mind that there may be various restrictions for certain type of products. One example is an exclusive import agreement that some brands may have with local/regional importers in your area. In such cases you will only be able to purchase those products from those exclusive importers (which defeats the whole point of what you're trying to do).
Companies that produce goods typically deal directly with wholesalers/distributors, who then sell their products to retailers. You can find out the the contacts by going to the brands directly, they'll be able to provide you with a list.
This is a difficult and very costly business to operate, despite its fairly simple business model. You'll have to build and maintain relationships with many customers in your local area. The logistics can be tough, especially if you have to deal with corrupt customs personnel in a third world country. Also, there is no lack of competition in most countries, so large companies with massive warehouses will be able to get large volume discounts, leading to low prices that you may not be able to compete against.
Start small by securing deals with local retailers and keep costs low by working out of your home and using your own vehicle for delivery. This will allow you to get your feet wet and hopefully built up some cash for future expansion.
To start an import/export business you have to know the market, select the best business, open a letter of credit at your bank, See merchandise through customs and collect the stock.
I work for a consulting company in Shanghai, which helps foreigners to set up companies in China, export or import products and many other kinds of business issues.