Given that the world is now a global village there is barely anything that does not move between borders be it books, food, whitegoods and even cars. Import and export activity is routine for many businesses, and the reason for living for others. It is almost certain that you have used importing techniques in your business before, but there are some very important things you have to pay attention to when organising your documentation.
A common adage is that importing and exporting has next to nothing to do with goods and everything to do with documentation! It sounds completely strange but it is true! The importance of correct paperwork cannot be overstated properly managing importing and exporting. If you are the type of person who just can not stand dealing with paperwork, may we suggest that you hire someone who can! Documentation is the cornerstone of international trade and the lifeblood of making a living from it.
There is generally some variation in the documentation required for trade from country to country but they are sure to include the following:
* Purchase order - It seems like a business requirement but it may be needed for financing. The purchaser may need to show the order to his bank to organise a temporary loan or customs may want to see the paperwork to make sure everything is valid.
* Letter of credit - this is used for making payments for imported goods, once the necessary documents are handed over (see, we told you they were important). A letter of credit basically says that the importers bank guarantees to pay provided all the papers stipulated in it are in order.
* Shipment documents - a bill of lading is needed for sea shipments or an airway bill when goods are sent by plane, as proof that the goods have been sent by the supplier.
* Certificates of origin - Several countries have restrictions on the importation of goods from certain other countries, and may apply tarrifs to these goods or ban them altogether. Alternatively, there may be tariff benefits accorded to goods from specific supply sources. In such cases, an exporter will need to submit a Certificate of Origin, which is endorsed by a designated regulatory authority.
* Quality or inspection certificates - if the buyer specifies an inspection prior to shipment, these are paramount to making sure the deal is confirmed.
* Packing list - The list of all of the cartons within the container and the contents within.
* Invoice - The most important document, make sure that a full summary of goods is outlined and it is invoiced in the currency of sale.
* Others(!) - these are specific requirements, and change from country to country. For example, Australia has stringent quarantine restrictions governing the trade of food and animal products. You would need to secure a permit, or subject your goods to an inspection or quite possibly both.
This might seem like a long list, but is in no way exhaustive. That is why the most important element of starting an import export business is to hire someone who knows exactly what they are doing in the sphere. It will end up saving you a lot of money and a lot of heartbreak in the long-term.
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