The Basics in finding a wholesale manufacturer

Written by admin on June 19th, 2013

The wholesale manufacturer

Going to a wholesale manufacturer to supply your product is a great idea. There’s nothing better than starting at the source.

If you’re into importing and exporting business, or you just prototype products for local distribution. It can be quite a challenge to find a manufacturer, one you like working with and whose factory produces a quality product at a fair price. They might sell to you, depending on their minimum order requirements. By starting at the source, you save money without sacrificing quality, great right?

Do Extensive research

So now we’re looking for wholesale manufacturers, the necessary thing to do is do thorough research. The best way to do this is using the internet.

There are thousands of manufacturers out there. You can do most of your research on the internet or at a library. And you can browse products that are related to your product at retailers to gain information about manufacturers.

A great way to start is going online to conduct research, there are tons of helpful resources to be found just by searching, “find a manufacturer” on Google. With an internet search, it’s possible for you to narrow in pretty effectively on overseas manufacturers.

Attend a Trade Show

There is incredible amount of information online, but word-of-mouth can still be your best-friend in finding reliable and credible wholesale suppliers.

Trade shows are often the best place to find information. Professionals in the industry with years of experience can quickly list the best and worst suppliers to work with. As long as you’re a serious professional yourself, you shouldn’t have any trouble finding someone willing to share their knowledge.

Moreover, a trade show allows you to connect with all the major manufacturers and wholesalers in a niche. It’s a great way to make contacts and research your products and suppliers all in one spot. This only works if you’ve already selected your niche and/or product, and it isn’t feasible for everyone. But if you have the time and money to attend, it’s a great way to get to know the manufactures and suppliers in a market.

Devour Directories

A supplier directory is a database of wholesale manufacturers/suppliers that’s organized by market, niche or product.

You’ve got to know everything about a manufacturer. It’s a significant part of your business’s success – you need to do everything you can to make sure you find the right one for the job.

Many directories employ some sort of screening process to ensure the suppliers listed are genuine wholesalers. Most are run by for-profit companies who charge a fee for access to their directory.

Supplier directories are a convenient way to quickly search for and/or browse a large number of suppliers in one place and are great for brainstorming ideas for products to sell or niches to enter. If you’re short on time and are willing to spend the money, they can be a helpful tool.

Ask for referrals

The best way to double-check their credibility is by speaking directly with their customers.

If the customer is satisfied, they should be happy to speak with you about the supplier and highly recommend them. When you speak with them, listen carefully. While a satisfied customer may not directly voice a complaint, you can sometimes read between the lines. The most important thing is gain a better perspective on exactly how the supplier conducts business, and then judge whether it fits you.

Other: Fantastic sites you can use to find wholesale manufacturers

Here are awesome sites you can use to find the right manufacturers.

ThomasNet – Find over 610,000 qualified manufacturers, distributors, MRO providers and custom manufacturers.

Wholesalecentral – There’s no charge to search Wholesale Central for suppliers because it charges suppliers a fee to be listed and also displays ads on their site. They also claim to review and screen all suppliers to ensure they are legitimate and trustworthy.

Worlwidebrands – Worldwide Brands is one of the oldest and best-known supplier directories. It advertises that it only includes suppliers that meet a set of guidelines to ensure legitimate, quality wholesalers.

HKTDC – Source from 120,000+ quality manufacturers and suppliers, connects millions of international businesses through a variety of services.

 

The Letter of Credit – What is a letter of credit?

Written by admin on June 19th, 2013

What is a letter of credit?

Common terms are L/C, LC or LOC. A letter from a bank guaranteeing that a buyer’s payment to a seller will be received on time and for the correct amount.

A letter of credit is a binding document that a buyer can request from his bank in order to guarantee that the payment for goods will be transferred to the seller. Basically, a letter of credit gives the seller reassurance that he will receive the payment for the goods. In order for the payment to occur, the seller has to present the bank with the necessary shipping documents confirming the shipment of goods within a given time frame.

In the event that the buyer is unable to make payment on the purchase, the bank will be required to cover the full or remaining amount of the purchase.

The letter of credit and the international trade

Letters of credit have been used for centuries to facilitate payment in international trade.

There is no doubt that the the use of letter of credits will continue to increase as the global economy evolves. The LOC’s are common in international trade because the bank acts as an uninterested party between buyer and seller. It is often used to eliminate risks such as unfamiliarity with the foreign country, customs, or political instability.

All letters of credit in international transactions are governed by the International Chamber of Commerce Uniform Customs and Practice for Documentary Credits. The general provisions and definitions of the International Chamber of Commerce are binding on all parties. Domestic collections in the United States are governed by the Uniform Commercial Code.

A LOC is a contractual agreement between a bank, known as the issuing bank, on behalf of one of its customers, authorizing another bank, known as the advising or confirming bank, to make payment to the beneficiary. The issuing bank, on the request of its customer, opens the letter of credit. The issuing bank makes a commitment to honor drawings made under the credit. The beneficiary is normally the provider of goods and/or services.

Essentially, the issuing bank replaces the bank’s customer as the payer.

Where the letter of credit gets money from

The bank promises to pay on behalf of a customer, but where does the money come from?

The bank will only issue a letter of credit if they are certain that the buyer will pay. Some buyers have to deposit enough money to cover the letter of credit, some already have money to begin with, and some customers use a line of credit with the bank. Sellers must trust that the bank issuing the letter of credit is legitimate.

The characteristics of the letter of credit

The letter of credit has four characteristics.

Negotiability

Letters of credit are usually negotiable. To be negotiable, the letter of credit must include an unconditional promise to pay, on demand or at a definite time.

Revocability

Letters of credit may be either revocable or irrevocable. A revocable letter of credit may be revoked or modified for any reason, at any time by the issuing bank without notification. Once the documents have been presented and meet the terms and conditions in the letter of credit, and the draft is honored, the letter of credit cannot be revoked. It is generally used to provide guidelines for shipment. If a letter of credit is revocable it would be referenced on its face. The irrevocable letter of credit may not be revoked or amended without the agreement of the issuing bank, the confirming bank, and the beneficiary. An irrevocable letter of credit from the issuing bank insures the beneficiary that if the required documents are presented and the terms and conditions are complied with, payment will be made. If a letter of credit is irrevocable it is referenced on its face.

Transfer and Assignment

The beneficiary has the right to transfer or assign the right to draw, under a credit only when the credit states that it is transferable or assignable. Credits governed by the Uniform Commercial Code (Domestic) maybe transferred an unlimited number of times. Under the Uniform Customs Practice for Documentary Credits (International) the credit may be transferred only once. However, even if the credit specifies that it is nontransferable or nonassignable, the beneficiary may transfer their rights prior to performance of conditions of the credit.

Letter of credit types

There are five commonly used types of letter of credits, each containing different features, some more secured than the others. Irrevocable, Revocable, Confirmed, Unconfirmed and Transferable letters of credit.

Irrevocable and revocable letters of credit

A revocable LOC can be changed or cancelled by the bank that issued it at any time and for any reason.

An irrevocable letter of credit cannot be changed or cancelled unless everyone involved agrees. Irrevocable letters of credit provide more security than revocable ones.

Confirmed and unconfirmed letters of credit (Confirmed LOC more secure than unconfirmed LOC)

When a buyer arranges a letter of credit they usually do so with their own bank, known as the issuing bank. The seller will usually want a bank in their country to check that the letter of credit is valid.

For extra security, the seller may require the letter of credit to be ‘confirmed’ by the bank that checks it. By confirming the letter of credit, the second bank agrees to guarantee payment even if the issuing bank fails to make it.

Transferable letters of credit

This type of LOC is commonly used when intermediaries are involved in a transaction. A transferable letter of credit can be passed from one ‘beneficiary’ (person receiving payment) to others.

Documents presented for payment

To receive payment, an exporter or shipper must present the documents required by the letter of credit. Typical types of documents in such contracts might include:

Usually, the Bill of lading(BOL) is enough proof that the goods have been shipped. However these documents might be required for further evidence.

Financial Documents

Bill of Exchange, Co-accepted Draft

Commercial Documents

Invoice, Packing list

Shipping Documents

Transport Document, Insurance Certificate, Commercial, Official or Legal Documents

Official Documents

License, Embassy legalization, Origin Certificate, Inspection Certificate, Phytosanitary certificate

Transport Documents

Bill of lading (ocean or multi-modal or Charter party), Airway bill, Lorry/truck receipt, railway receipt, CMC Other than Mate Receipt, Forwarder Cargo Receipt, Deliver Challan…etc

Insurance documents

Insurance policy, or Certificate but not a cover note

 

Expand and Market your Retail Business Online

Written by admin on June 19th, 2013

Building a website for your business

Building a website for your business is not a luxury, these days it’s a necessity.

Even small establishments have abandoned the notion that their business can thrive without an online component. They know that most customers, if not all, like businesses that are well established in the virtual world.

So to get started, you can hire someone to create a website, or you can go make coffee and set it up yourself. You can have a nice site designed by yourself for as little as $5.00 per month plus yearly registration of your domain name, the website address. There are a number of websites, such as MyDomain.com or GoDaddy.com, that will allow you to check the availability of domain names and register available names immediately for a fee no more than $10.00.

Moreover, your website needs to have easily navigated layouts, be filled with useful and interesting information and be free of junk or unhelpful things. Bottom line is avoid doing anything that will shoo away a customer from your site, you can hire a web designer for this matter and your investment will surely pay well.

Submit your website name to many website directories. You can search the Internet for free website directories and you will find quite a few links to places where you can advertise.

Pay per click advertising

There’s no better way to get targeted traffic than through pay-for-performance keyword advertising in search engines.

If you’re not clear on what pay per click ads are, those are the sponsored links that show up when you perform a web search in Google, Yahoo and other search engines. You can set a price that you would be willing to pay every time someone clicks on an ad that you write, if no one clicks your ad then you do not have to pay anything.

The goal of pay per click advertising is to get in front of searchers who are looking specifically for what you have to offer. This takes careful keyword research, strategic bidding, and compelling ad copy just to get the click.

Promote your business via youtube

A convenient, safe and popular way to promote your business.

Nowadays, people use YouTube for almost everything: to persuade, to inform, to entertain, and to instruct are just a few examples. YouTube is not only a video-sharing site, it is also a social network because a lot people would be discussing about the videos as well. Therefore, YouTube is an excellent way to promote your business.

You can do these things to promote your website using Youtube:

Keywords are extremely important when you want to promote your business through videos. It is the best way for people to find what you have to offer. Use keywords in your title of the video, the description, and tag them to your video. If you are having trouble finding the right keywords, be sure to use Google Keyword Tool to find variations of the keyword.

Videotape launches and other public events promoted by your business so that clients who couldn’t make these events are still able to catch up on what happened.

You must definitely include your URL of your website in your video, in the description and/or in your channel. Therefore, people will visit your website after they have seen your interesting videos and will generate a good flow of website traffic and sales. This is essential in online marketing and definitely will help promote your business. This is very important when using Youtube to promote your business.

It is exceptionally important that you don’t use YouTube to immediately sell a product or service. People on YouTube are generally not interested to look for things to buy from you yet. Therefore, it is wise that you should come up with plenty of reviews on whatever your business is doing. Make it interesting, funny, and attractive to audiences so that they can come back for more content from you.

Using forums.

Forums are the awesome and good way to boost your site traffic and bring readers towards your website.

Traffic by different forums can help you get your products sold or they can also be used for the purpose of increasing website readers as well as comments. How? By showing yourself as an expert and as someone who genuinely wants to help resolve people’s problems and that will ultimately build trust. You are giving a signal to moderators of the forum that you are in the forum to spam. With that, an occasional linking to your website inside the discussion shall not only be condoned but you will also be thanked for providing them with valuable information. Not all blog sites or forums allow promotion blog or forum posts and breaching this could see your business blocked and even badmouthed. In some cases you may have to pay a fee to advertise on their sites but usually you do not.

The power of email marketing

E-mail marketing is an extremely effective tool — if used correctly.

Email marketing is an extremely powerful website promotional tool. It is one-to-one direct marketing that is personalised, with well-defined targets, where the results are instant, accurate and easy-to-understand. You can create lists of customers, or potential customers that you can keep in touch with on a regular basis. However, be aware that many recipients regard this as spamming and may complain. It makes good business sense to only send information to people who want to hear about your products or services and not to those who do not.

Social Networking presence

Social networking sites will most likely be your first point of contact with your customers.

The big two here would be Twitter and Facebook, but beware not to spam your customers. Try to make your pages as conducive to conversation as possible. Post images of products you love and are excited about. Ask questions and respond to replies. Make your brand seem personable and enthusiastic.

Create Brand Alliances. “Following” and “friending” similar brands or stores where you believe your target customers shop already is one way to expand your following.

Here is a list of social networking sites you won’t dare miss for your websites:

Facebook – By keeping interesting updates and fun contests, you’ll surely get the number of visitors your website desires. Be sure to make a Facebook page though, not a profile. Because a Facebook profile has limited features and Facebook will take away profiles being used as a business directory.

Twitter – Get a good Twitter handle for your business and start tweeting updates. However, remember that Twitter is a conversation, not just a place to push your products or services. Twitter will help you generate loyal customers, or followers in that case.

Pinterest – Pinterest has created an platform for visual social media input and your company can make the most of this by feeding in well taken photos of your business products and other relevant images.

Social media is a great tool for businesses but it can also be misused and create follower fatigue, unlikes and unfollows and general annoyance if misused.

 

What kinds of goods can you import?

Written by admin on June 19th, 2013

You can import anything, except common sense

There are millions of products you can import, as long as it is profitable. You just have to find products that are new, different and desirable.

You can import clothing, plant seeds, plastics and even canned goods. The business just requires you to spend good deal of time and effort to find the right overseas sources and products, and then have them shipped to you. The product must generate enough revenue to be profitable, so it should either result in a large mark-up per sale or sell in sufficient quantity to provide a good return.

Using the world wide web is the best option, you can use it to find trade leads of available quality products to import where there is serious demand. Also, choose simple items as much as possible. What I mean by this is you want something that is simple to manufacture and has a relatively high margin of error. Most of these factories are not going to have the highest quality standards in the world, so the greater the margin of error you can put up with while keeping your customers happy the better.

Cheap to ship

Choosing small and light objects

Trust me, you don’t want to deal with the headaches that come with shipping furniture or kitchen appliances around the world. You want something that is going to be cheap to ship around, because shipping is going to eat your profit margins alive.

Goods in the $200 range

It becomes very capital intensive and much riskier if you are selling items of a higher price.

Higher ticket items are usually harder to ship, require higher quality control, and really magnify your mistakes when first starting out in importing. It’s best find success outside of that price range, save and try it later if you’re already more capable in dealing with those kind of products. But of course you can always use your own judgment.

I love seasonal products

No, seriously, as much as possible avoid seasonal items.

You want something that is going to sell consistently all year long and for the foreseeable future. I am sure there is a bunch of money to be made in selling Christmas stuff and winter clothes from Asia, but it is going to be extremely seasonal, and you are probably going to end up with a ton of worthless inventory.

The best profitable products

If the product does not have enough demand then it will likely not be very profitable to import.

Here are products you can make money of:

1. Smart Phones

The cost of technology varies extremely when it comes to different countries. This is due to the cost of the work to produce them and the cost of material. China is a great option to import smart phones from because of their ridiculously low prices for technology.

2. Technology Accessories

The accessories that go with some of the latest laptops, phones, or gadgets can be worth a lot in different markets. These items are made for wholesale so they are cheap to produce and cheap to buy a lot of them. By marking them up a little to sell then there is much profit to make.

3. Outdoor Games

There are some new ideas for outdoor games coming out every day across the world. One of them can catch on and if someone is importing them then they could make a huge profit.

4. Beauty Products

These products can be bought in large quantities for much lower prices then sold in stores. Beauty products will always be in demand for females so there is a low chance of the items not being bought.

5. Home Accessories

As the technology accessories are these are easy to manufacture and come in wholesale packages. Everyone uses different accessories in there home whether it is a candle holder or a flower vase.

The least profitable products

These products are incredibly difficult to make a profit off of even though they may seem safe.

1. Video Games

These electronic games are popular in their own country because they were made that way. Different cultures produce different interests and so trying to mend them together will just end badly.

2. Clothing

Clothing is an extremely hard import to profit off of due to the fact that people already have formed biases on clothing companies in their own Country.

3. Computers

Computers made in their native country are made for that country. The public has instinctively learned to use the laptops or desktops from their own country and will not be open to other choices.

4. Furniture

Although it is possible to make money off of furniture it is much more time consuming than the others. Also, importing these large objects can cost a fortune that may not be remade.

5. Jewelry

Importing jewelry means that the jewelry is most likely fake. By selling these fake pieces for a low price the consumer knows that it probably isn’t a good idea to buy it. Instead, buying authentic jewelry is a more profitable business.

 

What is an import agent?

Written by admin on June 19th, 2013

The Import Agent’s importance

The Import Agent plays a major role in the international importing business.

Many companies need the services of someone who can assist them in acquiring raw materials, semi-finished or finished goods from countries abroad. Through the use of an Import Agent, the company can find the appropriate supplier much more efficiently than if they had to conduct the search on their own.

Basically, import agents search for products in foreign markets and sell them in their home countries. In most countries it is extremely difficult and sometimes illegal to try to sell products from another country without going through an import agent. That’s why hiring an import agent is crucial for an overseas business.

Import Agent Types

The type of the import agent depends on how he/she is paid.

Commissioned Import Agent – The agent acts as an intermediary, the Import Agent receives a commission that is usually based to a percentage for a sale to a company.
Retained Import Agent – In this case however, the Import Agent is paid a fixed amount of price to represent a supplier to sell its goods over a fixed period of time.

Steps to become an Import-Export Agent

Because business is now a global affair, the import-export industry is now a necessity. Bottom line? Becoming a Import-Export Agent for the business is not a bad idea.

Here are steps you can follow:
• Get a degree in either international political economy or international economics. This will give you the basic conceptual and mathematical tools necessary to understand and profit from markets. Moreover, a degree in these fields and those closely related will provide insight into the problems and benefits of international markets in general, and your area of focus in particular. Your chances for this job are considerably low if you do not have any background.
• Decide on a specific area of specialization. This can be either a focus on a product or an area.
• Study the native language. There is no guarantee that all the documents in your field will be in English.
• Study the politics of your area of focus, one of your jobs is to speak to your American importer-exporter about the dangers, opportunities and common problems about trading with that specific country.
• Research global economic trends. You need to make sure you accurately understand trends especially if you are specializing in a specific are so that you can acquire information before your competitors.

Starting Out as an Import Agent

The main benefit of starting out as an Import Agent is that it has minimum startup costs. Many import agents start at home.

What you need to set up a home based import agent business:
1. Computer with Internet access. Then a Contact Management Software, an Accounting Software Word Processing & Spreadsheets, Graphics Software.
2. Fax, Printer, Office Furniture
Utilize your available resources correctly. What you are selling is your knowledge, expertise and supplier connections.

Necessary basic skills of the Import Agent

There are necessary basic skills an Import Agent must possess.

Speaking fluently – Talking to the client to convey information effectively.
Active Listening – Giving full attention to what the clients are saying, taking time to understand the points being made, asking questions as appropriate, and not interrupting at inappropriate times.
Critical Thinking – Using logic and reasoning to identify the strengths and weaknesses of alternative solutions, conclusions or approaches to problems an import agent can take.
Monitoring – Monitoring/Assessing performance of yourself, other individuals, or organizations to make improvements or take corrective action.
Coordination – Adjusting actions in relation to others’ actions in the business.

A proficient import agent

There are areas that the import agent must be proficient in to become successful.

Knowledge in the processes, rules and regulations of the country being exported from to the country being imported to.
Mastery in the product and industry expertise of the areas that the import agent represent.
Profound knowledge of the politics and cultures of different countries.
Complete understanding in the global perspective of payments and financial transactions.

 

What is a freight forwarder?

Written by admin on June 19th, 2013

Also referred to as “forwarding agent,” or simply forwarder.

Is a person or company that is crucial in managing shipments for individual customers or corporations to get goods from the manufacturer or producer to a market, customer or final point of distribution. A forwarder does not move the goods but acts as an expert in supply chain management.

A freight forwarder is critically important to you if you have a business opportunity overseas, especially if the business is importing goods into the USA from another country. If you are uncertain about the process, a freight forwarder can be the answer to your problems. A good freight forwarder can easily help you go through complicated importing and exporting laws and regulations.

Moreover, forwarders contract with a specific carrier to move the goods. While the freight forwarder doesn’t actually move the freight itself, it acts as an intermediary between the client and various transportation services. A forwarder contracts with carriers to move cargo ranging from raw agricultural products to manufactured goods. Freight can be booked on a variety of shipping providers, including ships, airplanes, trucks, and railroads. It is not unusual for a single shipment to move on multiple carrier types.

The history of the freight forwarding industry

The earliest freight forwarders was Thomas Meadows and Company Limited of London, England, established in 1836. The advent of reliable rail transport and steamships and the trade development between Europe and North America created demand for the forwarding industry.

The first international freight forwarders were actually innkeepers in London who held and re-forwarded their hotel guests personal effects, over time the forwarding industry flourished because it proved to be handy and convenient for the customers. The original function of forwarding was to arrange carriage by contracting with various carriers. The Forwarder’s responsibilities includes advising on documents and customs requirements in the country of destination. His correspondent agent overseas then looks after his customers’ goods and keeps him informed about matters that would affect the movement of goods.

The booming fur trade of North America included acquisition, trade and sale of animal furs. The French started trading in the 16th century, the English established trading posts on Hudson Bay in present-day Canada in the 17th century. The early freight forwarding industry was to ensure that shipment of goods was well arranged so that it is guaranteed to arrive to it’s destination.

Assisting in Packaging

A freight forwarder should provide assistance to the customer on how to package their products for export. Careful planning is required in order to protect the product.

The forwarder considers a lot of things. The item may be allowed to be stored in environments where extreme temperatures or weather may be experienced. If an item is shipped via air then the freight forwarder may suggest packaging that is lighter than normal to keep shipping costs to a minimum.

A lot of damage can occur during exporting. Movers may jar or drop objects. Airplane vibrations, exposure to bad weather, and rapid fluctuations in relative humidity can damage objects.

Proper packing will limit these and other travel hazards including:

• shock and vibration

• sudden changes in temperature and humidity

• mishandling

• theft, vandalism, and loss

Before moving a museum object outside of the building, consider:

• the object’s fragility

• the shipping method

• the climate through which the objects will travel

• the climate at the object’s destination

Providing the correct labelling

Freight forwarders will assist their customers in providing the correct labeling they require for their items.

The correct label will be required to show the precise items in the shipping container. It should indicate the following information:

• information about any hazardous items

• country of origin

• correct weight in pounds and kilograms

• port of entry details

• required details in the language of the destination country

Preparation of documents

Shipping items overseas require documentation. The freight forwarder’s specialist knowledge is needed to take care of the several documents required to fully prepare the shipment.

The relevant documentation should accompany the items that is to be transported either domestically or internationally. The amount of documentation per shipment varies depending on the country.

One of the most important documents is the bill of lading(BOL). The BOL is a contract between the owner of the goods and the carrier. The bill of lading includes the name and address of the consignor and consignee. The document often contains the routing instructions for the carrier. It should contain a description of the goods to be transported, the quantity for each of the commodities, and the commodity class and rate. Some of the other documents is the Certificate of Origin (COO), Inspection certificate, Shipper’s Exportation Declaration (SED) and the Export Packing List.

Some useful tips in choosing a freight forwarder

Weigh the freight forwarder’s service and the corresponding price. Make sure the company is licensed. Find a experienced freight forwarder.

It’s not always good to judge solely on the price. Also, choosing a freight forwarder’s service because of a lower rate may also not be the best option. Make sure you are quoted the full price upfront and it is confirmed by fax or email and make sure that the price is right for the corresponding service.

Ask if the company is licensed and bonded by the Federal Maritime Commission to make sure it’s business overseas is legal.

It is recommended that you choose a freight forwarder that is an expert on shipping your type of cargo. If you also plan on shipping items to a very distant country, it is better to go for a well established freight forwarder that has agents around the globe.

 

What is a customs broker?

Written by admin on June 19th, 2013

Also known as Customs broking or Customs brokerage

This is a profession that involves the clearing of goods through customs barriers for importers and exporters.

Custom broking involves the preparation of documents and/or electronic submissions, the calculation and payment of taxes, duties and excises, and facilitating communication between government authorities and importers and exporters. Custom brokers may be employed by or affiliated with freight forwarders, independent businesses, or shipping lines, importers, exporters, trade authorities, and customs brokerage firms.

Licensed by the U.S. Department of the Treasury, the customs broker possesses thorough knowledge of tariff schedules and Customs regulations and keep abreast of the amendments made through constant changes in the law and administrative regulations. Many brokers help clients in choosing the modes of transportation, the appropriate carriers and the best routes. There are estimates for landed costs, payments of goods through draft, letters of credit insurance, and re-delivery of cargo if there is more than one port of destination.

Customs broker in the U.S

Custom brokers in the United States prepare and submit documentation for various government agencies.

In the United States, custom brokers prepare and submit documentation to be granted clearance from government agencies such as the U.S. Food and Drug Administration, the U.S. Department of Agriculture, and the Fish and Wildlife Service. Also, in almost all cases the goods are required to be “entered,” that is, declared to CBP, and are subject to detention and examination by CBP officers to ensure compliance with all laws and regulations enforced or administered by CBP.

Customs broker in the U.S then also arranges the transshipment of merchandise for local deliveries via trucking companies. Many customs brokers in the U.S specialize in certain goods like apparel, perishables, or clearing the crew and manifest of large cargo vessels. Customs brokers can be located at inland ports to clear merchandise sent “in bond”, but most are located at major airports and harbors with international traffic.

Qualifications

Customs brokers are licensed by U.S. Customs and Border Protection. Serves as a legal representative to the Customs Service.

Customs brokers must pass the examination and background check of the U.S Customs Border and Protection to be licensed. They are not government employees and should not be confused with custom agents. Customs brokers need to be familiar with the tariff schedule, a listing of duty rates for imported items, and the regulations governing is an importations found in 19 CFR, the Code of Federal Regulations Title 19. To illustrate, a customs broker may need to advise an importer on the marking requirements of the country of origin, or complete paperwork for a clothing shipment subject to quotas and visa requirements. Knowing the requirements of each type of import can avoid costly delays or merchandise seizures.

As a legal representative to the Customs Service, they provide importers guidance and expertise in all aspects of importing merchandise to the USA. Customs broker help importers determine tax liability, ensuring proper classification, valuation, and other assistance in import matters.

Custom brokers helping the international trade

There are different sets of rules and regulations in every country regarding the transfer of goods entering or leaving their borders.

Customs regulations and laws concerning import and export of goods are constantly changing all over the world, sometimes even on a daily basis.

A customs broker or a customs brokerage firm is responsible for being updated to all of these rules and regulations to ensure that they them, in order to streamline the process of shipping goods as much as possible for the individual or organization. In effect, customs brokers alleviate the stress of dealing with customs officials and learning shipping regulations so that their clients can spend more time managing their core business.

Customs brokers serves as translators that communicates with agencies and governments throughout the shipping process, to ensure that all of the proper procedures have been followed.

Custom brokers in the digital world

Online transactions are widely used these days, and custom brokers are sure to be updated in order to meet online demand.

As quickly as the regulations regarding shipments are changing, so is the way people are doing business. It is clear that transactions regarding shipments and customs clearance procedures are being migrated online. Customs brokerage firms are constantly researching and developing their internal infrastructure to coincide with all requirements, so that procedures, electronic or otherwise, are followed properly.

Customs brokers ensure they have the most current technology, and that they stay on top of the various developments in this dynamic industry to provide the best quality service for their clients at all times.

Things to consider in choosing a customs broker

It should not be primarily about where the customs brokerage is located, but more about the question of who they are and what services they can provide.

Here are the following things you need to consider:

Knowledge – Do they employ experienced employees where many hold customs brokerage designations? What are their methods of training and educating their employees?

Experience – In which industries do they specialize? What is the average tenure of their clients? How long have they been in business?

Accessibility – Do they operate 24/7/365? Are they easily accessible through a live reception service? Can you speak to a live person when needed?

Company Culture – Are they customer service focused? Does their company emphasize detail, accuracy and compliance?

Credibility – What are some unique situations where they have helped other companies? What are some of their notable achievements and successes? How would other related service providers (i.e. trucking companies) rate their company? Can they supply references?

Client Education – What methods do they employ to update their clients? Do they provide trade compliance seminars or webinars?

After considering the following factors, you’re all set in choosing the right customs broker.

Writing a Conclusion:

1. Main points of the article

2. New Methods

3. New Approaches

4. Evidence

5. What did you learn?

Main points of the article are the following:

A customs broker takes care of clearing of goods through customs barriers for importers and exporters.

Documentations of the goods is very important in the U.S as well as in other countries.

Customs brokerage firms plays a key role in the international trade.

 

What are tariffs and how do you check them?

Written by admin on June 19th, 2013

A tax or duty for the importer

Also synonymous to “duty”, a tariff is a tax imposed on imported goods and services.
A tariff is a tax levied by governments on the value including freight and insurance of imported products. Different tariffs are applied on different products by different countries. These taxes are often a way to discourage a country’s consumers from buying products from another country and to support domestic products and services. National sales and local taxes, and in some instances customs fees, will often be charged in addition to the tariff. The tariff, along with the other assessments, is collected at the time of customs clearance in the foreign port. Tariffs and taxes increase the cost of your product to the foreign buyer and may affect your competitiveness in the market. So knowing what the final cost to your buyer is can help you price your product for that market.

Two types of tariffs most governments use

Governments have the right to determine what products will have a tariff and how much that tax will be, but in a nutshell they often use these two types to implement tariffs.
Here are the two:
Ad valorem tariff – a duty, or other charges levied on an item on the basis of its value and not on the basis of its quantity, size, weight, or other factor. This tariff can change from time to time as the value of the product increases or decreases
Specific tariff – A specific tariff is a set tax on a product, and this tax is the same on all products of its kind. This import tariff is expressed in an amount of money per unit imported. Usually, specific tariffs are especially designed to reduce imports into countries.

Five other main types of tariffs

Each country has separate regulations, but there are five main types of tariffs that are common in these policies.
Revenue tariff – a type of tariff that increases the national and local government funds. An example of a revenue tariff in a business is the tax applied to all imported oil in the United States.

Two-part tariff – the combination of specific and ad valorem tariff. A product with a two-part tariff would have a set tax as well as a value-based percentage tax.

Prohibitive tariff – a prohibitive tariff that is set on a high cost to keep products or items from being imported.

Protective tariff – is intended to artificially inflate prices of imports and “protect” domestic industries from foreign competition.

The negative and positive effects of import tariffs

The local government may benefit from the implemented tariff, but the consumers tend to take the fall.
The benefits of tariffs are uneven. Usually a government imposes a tariff to encourage its own industries and to discourage buying cheaper imports from other countries. If a government wants to protect its own clothing industry, it may add a tariff to imported clothing, to make sure that the imported clothes aren’t cheaper than the locally manufactured items. The government will see increased revenue as imports enter the domestic market. Unfortunately for both individual consumers and businesses higher import prices mean higher prices for goods.

How to check or determine tariff rates

There are the steps for finding and calculating estimated tariffs and taxes.
Step 1: Determine your Harmonized system or Schedule B member.

The first step in determining duty and tax information is to identify the Harmonized System or Schedule B number for your product/s. You can visit the Census Bureau because they sponsor a free online tool called the Schedule B Search Engine and an instructional video to help you classify your products.

Step 2: Determine the tariff rates

Once you know your product’s Schedule B or HS number (the first six digits of the 10 digit Schedule B number), you can determine the applicable tariff and tax rates for a specific foreign country. Then you search online to find several privately and publically available databases with tariff and tax information and apply your number.

But always remember, only the customs officers in the country where the goods clear can make the final determination.

What happens when there is no tariff imposed?

When no tariff or other restrictions are placed on imported goods, it is called free trade.

Free trade is a system in which goods, capital, and labor flow freely between nations, without barriers which could hinder the trade process. Many nations have free trade agreements, and several international organizations promote free trade between their members.

The idea behind free trade is that it will lower prices for goods and services by promoting competition. Domestic producers will not longer be able to rely on government subsidies and other forms of assistance, including quotas which essentially force citizens to buy from domestic producers, while foreign companies can make inroads on new markets when barriers to trade are lifted. In addition to reducing prices, free trade is also supposed to encourage innovation, since competition between companies sparks a need to come up with innovative products and solutions to capture market share.

Writing a Conclusion:
1. Main points of the article
2. New Methods
3. New Approaches
4. Evidence
5. What did you learn?

The main points of the article are :

Different tariffs are applied to different countries to either promote revenue or lessen foreign competition.
Most governments commonly uses two types of implementing tariffs
An import tariff may either boost or diminish the economy of a country.
Tariffs tends to be pro government but anti-consumer.

 

Sourcing wholesale products

Written by admin on June 19th, 2013

Deciding what you’re going to sell

You want to choose products that are going to sell well, but that the market isn’t completely flooded with.
To succeed as an entrepreneur, you must develop the ability to select and offer the right products or services to your customers in a competitive market. More than any other factor, your ability to make this choice will determine your success or failure.

There are thousands of products and services available to consumers today. And there are unlimited opportunities for you to enter the marketplace and compete effectively with a new product or service that’s better in some way than what’s already being offered by your competitors.

To determine what kind of items are appropriate for you to sell, you’ll need to look at trends. Being ultra-competitive to your competitor is needed to get sales, do it by research for local trends to find out what items are selling well.

When you’ve finally chosen a product. Ask yourself three things.

Is there a real need for the product or service in today’s market?
Is your new product or service better than anything else currently available?
Do you think you could become the number-one supplier in the market for this product or service?

If your answers are good enough, then you’re good to go.

Choosing your supplier type

There are types of wholesale suppliers you can use depending on your business.
Manufacturers – You might as well start at the source. If you’re selling branded items, go directly to the manufacturer of the product. They might sell to you, depending on their minimum order requirements. If you’re business is too small for them, you can contact a local distributor. By starting here you can get lower prices or a list of good distributors you can have access to.

Distributors – Take the list of wholesale distributors you got from the manufacturer, and start contacting each one. What you’re looking for are minimum order requirements and their wholesale unit prices. Their prices are slightly higher than buying direct, but minimum quantities are usually low and you have the convenience of purchasing products from different manufacturers on one purchase order.

Liquidators – If your product needs are flexible, often times you can purchase here a bulk load of product for up to 75% off the original wholesale price. Consider your purchases carefully because once a product is sold out it’s usually gone for good.

Drop Shippers – If online business, drop shipping is one of the best ways to supply products for your business without the additional costs. Drop shippers are basically distributors in that they buy from manufacturers or other distributors, then they sell their goods at wholesale prices and will ship directly to the consumer with no minimum order requirements.

Looking for the supplier
With the power of the Internet, you can find wholesale suppliers in just a few clicks of the mouse.

Looking for suppliers online is the primary way. You can use specific search engines for wholesale suppliers, like ifindwholesalers or Wholesale Central, but never underestimate what the general search engines like Google can do. Also, you can check out the ads and classifieds of trade Magazines for wholesalers in your industry. There are also many trade lead sites like tradezone which allows you to find suppliers all over the world. Or you can check out print publications and trade shows to see suppliers showcase their products.

Intensive research

Doing your research will help you identify scams, fakes and just plain bad businesses.
First you can check out the supplier’s website. Check out all of their policies such as returns, damages, backorders, and make sure they have their contact information and physical address posted on their site. Avoid sites that only provide contact forms. Your best source of information is the supplier themselves – call or email them and ask questions about their products, policies, and terms. You can also ask them for customer references that you can check.

Another way for finding references
Online forums are a great place to get references and ask questions.

Also referred to as Internet forum, or message board, in here you can join people in posted conversations to find reputable suppliers. You can use sites like wholesaleforum where you can check out other buyers reviews about a supplier. You can also check your suppliers out through the Better Business Bureau, Hoover’s Online, and even the FBI.

Some things you may need before you can place your order
Real wholesale suppliers normally deal with businesses only and require tax IDs to do business.

The requirements vary from state to state, but here are the things you may need to begin:

Local Business License: The city or county where you are operating your business will require that you have a local business license. Call or visit your city hall to find out what the requirement is in your jurisdiction.

State Business License: You are not required to have this license unless you are selling products such as alcohol and cigarettes. If you do you can find out your state’s requirements by simply calling your local government offices.

Sales Tax License: If you live in a state that collects sales tax, you will most likely need this license. Having it will allow you to legally charge sales tax to customers purchasing your items. By calling your State Franchise Tax Board you can find out how to get this license.

Federal License:This license really only applies to a very small portion of businesses that are selling products or services that are highly regulated by government agencies (i.e., if you are selling firearms or offering investment advice). If you think your business falls into that category, you can call your state government offices for more information. However, if your business is required to have this type of license, it may be best to hire an attorney to make sure you are complying with every law and have all the necessary licenses, permits and documentation.

Seller’s Permit (also referred to as a reseller’s permit or sales tax permit):This permit is typically required for businesses that are purchasing wholesale products for resale. Usually your State Franchise Tax Board is the agency that grants this permit.

You can also set up payment terms and arrange credit with your suppliers, so make sure to ask them what kind of options they can offer you.

Writing a Conclusion:

1. Main points of the article
2. New Methods
3. New Approaches
4. Evidence
5. What did you learn?

The main points of the article are the following:

Don’t rush, it’s best to give yourself a long lead time to do proper research.
Go for a supplier that is appropriate for your business.
Always find references for suppliers to ensure your safety.
Make sure your requirements are ready to do business.

 

How to import from China

Written by admin on June 19th, 2013

Choosing a product to import

The chance to spend your time dealing with a product you love is one of the viable reasons for choosing a product to import. It will be evident in you if you have passion for the product you sell and that will deeply interest customers.
And about costing, your products which can be shipped in large quantities, can be far less expensive than those that cannot. Think carefully about the size of your product and how much you can fit into one shipment. You can also opt to ship first small and light products if you want it cheap.
Also, you have to consider the uniqueness of the item. A unique item will most likely sell and helps you avoid excessive competition.

Making a list of exporters, or suppliers, who can provide you with your product

Here is list of resources you can have access to:
Made-in-China.com – provides every information you need about a Chinese supplier, from product listings, company information, contact details, company’s background culture, and factory photo tours.
China Yellow Pages – an outsourcing directory containing listings of products along with provider website URL’s and contact detail.
China.cn. China.cn – an outsourcing directory with thousands of Chinese products, providing buyers with complete contact information for each listed supplier. The website also offers buying and selling leads, tradeshow information, and trading resources for buyers and sellers.
Analema International – a professional sourcing company providing buyers with services such as help identifying suitable suppliers, assistance negotiating with suppliers, and quality inspections both during manufacturing and before shipment.

Narrowing down your supplier list

Knowing what to ask a supplier is a great way to narrow down your list. First look for client references, a reputable supplier should be able to provide you with client testimonials and references. Then consider their business licensing information, this will help you avoid future legal problems that may get your business in trouble. If you can spend the money you can personally visit the suppliers premises to check out the quality of their product. You can also ask for samples to assess the products quality more.
In general, a reliable supplier:
Won’t disappear overnight with your cash.
Will deliver on time.
Will deliver the products you have specified and at the level of quality expected.
Will keep you informed if there are any problems or delays.


Negotiating a deal with your chosen supplier, then locating local resellers

Different negotiation skills and tactics may be required in dealing with Chinese exporters, there are some things you need to keep in mind to make sure you get a deal. First, focus on building the relationship. Chinese exporters are not likely to go for a deal until they have had the opportunity to get to know you a little. Second, show them that you are determined. Your desire to get a signature on a contract take a back seat to building a trusting relationship where each party will feel morally obligated to perform, even if they did not have a signed contract. Lastly, recognize the importance of Chinese hierarchy, shaking the hands of a lower-ranking executive first in front of a higher-executive can greatly affect the negotiating process, learn by how the executives address each other.

After your success in the negotiation, you need to find good resellers so that you can begin placing your orders. First contact each potential reseller by telephone and introduce yourself properly, ask if they would like to receive some information via e-mail and verify their email address. Then, send a brief e-mail with a professionally designed attachment, which describes your company and your product. Follow up with a phone call a few days after the e-mail and ask for a meeting. At the meeting, sell your product and get a signed contract so you can begin ordering product.

Begin placing your orders and make sure you get it through the U.S CBP to pay your duties.

Each company will have a minimum order amount and a basic shipping agreement. Then ask to speak with a CBP import specialist assigned to the product you are importing.
The most common Chinese exporter arrangements to the U.S includes:
Express Mail Service, a worldwide shipping service that works with the United States Post Office (“USPS”) to deliver goods from various countries to the United States.
DHL International, DHL is a global shipping company providing shipping services commonly used by Chinese suppliers to ship goods to the Unites States.
Free On Board, FOB is used for freight shipping, in conjunction with a port of loading. This means that the seller is responsible for paying transportation costs of the goods to the indicated port of loading, or shipment, as well as loading costs. The buyer is then responsible for paying the costs of transport, insurance, unloading, and transportation from the arrival port. In this type of agreement the buyer owns the goods as soon as they leave the port of shipping.

After that, ask for Customs and Border Protection import specialists to provide you with product specific requirements, advisory duty rates, answer your questions about filing an entry, and assist you with preparing and filing the required paperwork.

Arranging for pick-up and transport, and also making sure you and exporter files the ISF

Contact a commercial cargo company. Avoid fines by filing the Import Security filing.
A commercial cargo company will arrange to have your shipment picked up at the port of entry and shipped to your warehouse or local resellers. Find Cargo companies by consulting your local yellow pages or favorite online phone book.

Make sure you or the company you are buying the product from files the ISF (Import Security filing) If should be done 24 hours before shipment sets sail. If this is not done by either you, your broker or the shipper, you may have to pay a $5,000 fine.

Writing a Conclusion:

1. Main points of the article
2. New Methods
3. New Approaches
4. Evidence
5. What did you learn?

The main points of the article are the following :

It is essential to determine the kind of product you and your business really needs.
Choose your supplier well.
Never be too eager buyers and underestimate the time and costs of importing from China.
Always do legitimate business, settling for less will jeopardize you and your company.