Top 15 Tips and 12 Startup Ideas Import Export Business. How to Find Buyer?

Top 15 Tips and 12 Startup Ideas Import Export Business. | How to Find Buyer? | Exim Startup

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The story of Lord Alan Sugar is a great one, from selling radio aerials for cars and other electrical goods out of a van to a market stall, to multimillionaire. Starting an import export business really isn’t rocket science and can be hugely rewarding and make you financially successful but of course, is going to take time, dedication, and some all fashioned hard work.

Knowing how to start an import export business is challenging and will take some study and research but the rewards are great.  Here are a few tips and ideas on what to think about as you start your import export business venture:

  1. Product Testing: Is Your Product Hot Or Not?
  2. Find The Best Products For The Lowest Price
  3. Get Samples From Suppliers
  4. Safety In Numbers: A Range of Products Earn Bigger Profits
  5. Understand Agencies
  6. Learn How To Negotiation: The Art of The Deal
  7. Learn How To Find Buyers!
  8. Understand Incoterms 2020: Code Words for Logistics
  9. Find A Freight Forwarder
  10. Understand Marine Insurance: For When Disaster Strikes!
  11. Remember Your Terms and Conditions
  12. Setup Your Company The Right Way For You
  13. Write Your Business Plan
  14. Keep the Tax Man Happy!
  15. Build Your Own Website

Your Own Import And Export Business

Some reports state that around 70% of us are unhappy in our job. This being true, it’s always possible to change career, take the plunge, and start up your own international trading business.

It’s scary but for those that do and are willing to take the time to learn a new business, do their research, create a business and marketing plan and have the guts to take action, it’s well worth it. Nothing’s easy in this world but once a few sales start to come in, it’s a very rewarding feeling seeing something come to life that you’ve built.

Starting an import export business or any business for that matter is exciting and hugely rewarding. The sweat, hard work, and hours that you put into your own company, benefit you directly, rather than your boss or manager, you reap all the rewards. Making all the decisions and being accountable only to yourself will give you a feeling of freedom and the rewards are many.

Securing your own financial future, earning the respect and admiration of colleagues, friends, and family as someone who took the risk and went out and built their own company is a satisfying feeling. Working the hours that you want to work is a huge advantage over having to work endless hours for someone else.

Let’s get to the point and tell you how to set up your own company, how to trade on the International stage successfully, and point out some of the most common pitfalls, so that you can set up and trade successfully and most importantly, profitably from day one.

Minimum Investment For Import Export Business

Other than knowing how to start an import export business, the next question is inevitable, how much will it cost? There’s no single answer to that question, it depends on many factors. Obviously, if you’re importing high-end luxury cars from Italy, you are going to need a significant amount of capital behind you, much more than if you were to import grapes from France for example.

So it’s not so much, “how much do I need” as much as what’s in your business plan and how will you fund it?

Is Your Product Hot or Not?

You’ve thought long and hard about the products you want to either import and sell or what products you’re producing for export.  If you’re looking for some inspiration for ideas, we’ve got ideas from six countries below to get you thinking.

Many are eager to jump right in, buy stock and start selling, however before you dive headfirst into your import export business and spend your hard-earned money on the stock, it’s vital to test the water and find out if others are as enthusiastic about your product as you.

You may think that the product you want to sell will be successful and you’ll make a healthy profit from it but in reality, this may not be true. We’ve all seen Dragon’s Den where budding inventors and entrepreneurs think they have the most revolutionary idea or product but the wise Dragon’s don’t see it and shoot it straight down! Just because you like a product doesn’t mean that the public will like it and part with their hard-earned cash to buy it.

There are many ways to find opinions on your ideas and products. Sometimes you have to be a little creative in how you approach it but it’s time well invested. Start with friends and family and ask for honest opinions. Discuss pricing and ask your friends if they would pay for your product. Hold a focus group in your local neighborhood, give your product to the focus group and ask for their thoughts and feedback.

Find the Best Products for the Lowest Price

Also Check Top 20 Products Export from India

When it comes to selecting and sourcing products, my advice is, it’s best to perhaps pick an industry that you are familiar with so there’s less of a learning curve, if you’re into mobile phone technology and already know and understand a lot in this field, it can be a good idea to follow this road.

You’ll already understand the products that you’re looking at and probably know to price already so these are a few advantages to sticking to what you know.

It’s extremely important to know where to buy your products from. This is one of the pillars of the foundation of your import export business and will dictate if your business is profitable or not.

A common complaint we hear from many entrepreneurs is “I know what I want to import and sell but I don’t know where to get it from”. Where can you source products from with such a huge amount of suppliers in a global marketplace?

You must understand how to source your product from the right supplier with the right terms and price. Many traders rely on Internet suppliers like Alibaba and other such companies. These companies a certainly worth looking at there’s no harm in this but you’re limiting your search.

There is a great myth among buyers in that you get the best price, product, and terms from China. This is not always the case! China is not actually the center of global trade. Sourcing from companies in Preferential Trading Countries (PTC) can be a much easier and cheaper way to go.

We’ve written a more detailed blog where we discuss some ideas on sourcing internationally.

Get Samples From Suppliers

Facing buyers will be a key part of any trading that you do and following some simple guidelines will make the process easier, give you more confidence and give you a much higher conversion rate. Buyers will want to see samples of the goods they intend to buy and samples come in all shapes and sizes.

Some are easy to obtain from suppliers such as clothing, toys, and watches. Others are bulky, such as construction and capital equipment. Most producers will give a limited number of samples free of charge to a serious buyer or at a nominal cost.

It’s important to make sure you know how the products work when you receive these samples, as you will have to make presentations and demo the product to potential buyers so familiarise yourself with all aspects of the product. This is where your market research and focus groups will come in very handy as you will be able to take all the feedback and questions you received and be ready for the same, preparing your pitch to cover these.

Make contact with companies and see what they can offer you and at what prices.  If you’re able to take a trip and go and visit manufacturers or factories, this is always time and money well spent and shows you’re serious.

You’ll also have the added advantage of seeing the product yourself, checking the quality of the materials and the workmanship.  Nothing really beats physically seeing it as photos and video really can’t show this.

A Range of Products Earns Bigger Profits

Now that you have sourced your product, got your samples, conducted your research which is proving positive, you may feel ready to dive in, start your import-export business and start approaching buyers and retailers, asking them to place orders.

Before taking that jump, it’s very wise not to become complacent and make sure you vary your product range. This offers several advantages.

Concentrating on selling just one product will limit you. You should ideally have a complimentary range of products.

Appointments to buyers/retailers must result in a sale. If you show your potential buyer only one item, for example, an electric kettle and they do not want to place an order, your visit was a waste of your time. However, if you then show the buyer your complimentary range you have a better chance of securing an order.  If they are not interested in your kettle, they may be interested in your unique coffee maker, toaster, and waffle maker.  You get the point, remember, there’s always safety in numbers!

By offering a product range, even if your buyer likes the main product you wanted to market, they may also like other products within your range, so a purchase order that would have been for just one product could turn into an order for several products. This increases profits for you and in the worst case, if the buyer did not like the first product you had in mind, they may like another in the range and still place an order. Don’t limit yourself but keep as many options as you can on the table.

Understanding Agencies

Generally speaking, setting up as an export and import agent can be the way to go if you’re looking for minimal financial commitment as it requires less financial exposure, so this is something to definitely consider.

Many businesses are set up as agencies. There are two main types of agencies available and it’s extremely important you understand both. Both have their benefits and can offer you advantages depending on your personal situation and what you want to achieve. There are traditional agents and brokers. There is a lot to understand when dealing with agencies that are a little beyond the scope of this blog but we have a blog post that goes into much more detail on how to become an import export agent.

The Art Of The Deal

Negotiation is one of the highlights of being an entrepreneur and being “the boss”. This is where you can set the terms of your business and drive a hard bargain. Negotiating is a key part of any business from the trader at your local market stall, to multi-billion pound companies the world over.

Hone your negotiating skills, be confident and a little charming and you can walk away with the deal you want. We’ve seen on Dragons Den how the dragons and the entrepreneurs will negotiate back and forth, sometimes quite intensely until the deal is done with both sides feeling great about the agreement. As an entrepreneur this is a great feeling, securing the deal you want and giving you more confidence going into the next deal.

At every junction of your import export business, you’re going to have to negotiate. Once you’ve sourced your products, you’ll have to negotiate the price, the quantities, the samples and it won’t end there. When you approach buyers, you’ll have to negotiate the terms of the sale, the retail price, the wholesale price, minimum order, delivery time, exclusivity, and the list can go on. Contract terms will also need to be negotiated.

Buyers and Sellers seldom agree on the terms and conditions of the contract on the first attempt. There are usually periods when both parties have to negotiate to reach an agreement. Before you enter into negotiations, you must develop a negotiating strategy. Here are a few negotiation techniques to get you started.

Negotiating becomes easier the more you do it. You’ll start to get an idea of how far you can push and what the other party will be willing to give up. As you do more and more deals with the same parties, you will be able to negotiate better deals and likely more quickly as an element of trust will be built.

As the other party gains trust in you by paying your bills on time and living up to your word, you may be able to negotiate even better deals going forward as you remove their “hassle factor”.

How To Find Buyers

Finding buyers for your products is obviously key to any import export business. There are several ways to find these buyers and I bet we have some suggestions for you that you haven’t thought of.

There’s quite a lot that we can talk about here so we’ve created a separate blog with some suggestions on How to Find Buyers For Your Export Business

Incoterms 2020

This is where you can really take hold of your import export business and show your import export knowledge. Terms of delivery is fundamental to any business trading internationally and once you’re familiar with these you will be in a much stronger position to negotiate and trade.

It’s absolutely vital that you are aware of these terms of delivery and understand them. By understanding these terms, you’re protecting your goods and covering your risk. Get this right and you’re halfway to building your import export business empire.  Get this wrong, you’re going to lose money!

Also, CheckPayment Terms in Export and Import Business

These terms determine the buyer and sellers’ obligation and using these terms will clear up any confusion and stop any issues before any disagreement arises.

Freight Forwarders

One other big part of the business of import and export is knowing how to use a freight forwarder.  Eventually, you’re going to need to use one, you’ll outgrow the post office, the bigger the shipment size of your import and exports, so it’s worth understanding how they can help you and what to be aware of.  We’ve written an in-depth blog on what freight forwarders do and how they can help you.

The blog also includes some tips of what to be aware of and how you can protect yourself from being overcharged.  Most freight forwarders are there to help importers exporters and run an honest game but as with everything, there’s always one or two bad eggs, so it’s worth being aware.

Marine Insurance

Needless to say, insurance of your goods is a must. Without this, the money that you’ve paid for your goods, should anything go wrong, is unprotected and will hit your cash flow and profits hard. Accidents happen and it’s a risk not worth taking and something that can easily be covered by insuring each shipment.

Marine Insurance gives cover from the seller’s warehouse to the buyer’s0.

warehouse, therefore it offers a “Multi-Modality” cover. As with all insurances, there is small print and conditions that you must be aware of. Without understanding these, your shipment may not be covered, even though you have paid your premium. Taking the time to really understand the insurance of your goods is vital to running a successful import export business.

Those Pesky Contract Terms and Conditions

Terms and conditions of trade are possibly the most fundamental part of the business. Without terms and conditions agreed upon, there will never be a contract signed or an order placed.

Understanding the terms that your business associates want you to trade under and just as importantly, the terms that you will operate your business under, is massively important.

Before you start trading, it is essential you have your terms and conditions in place as a buyer and a seller. These terms and conditions will form part of your contracts and you must make sure these terms cover some basic issues.

It is very important that your terms and conditions fit the goods of the contract. For example, if you are dealing in electrical goods, the goods must conform to International standards for that product.

In the case of food, the food must conform to import customs regulations and the food itself must conform to national hygiene standards, packing standards, and shelf-life.

It’s advisable to write your terms and conditions of trade with the help of a lawyer so you can be sure they will stand any legal challenge.

There is much to cover with terms and conditions which is beyond the scope of this blog but our Online International Trade course will cover this in more depth.

Setting Up Your Company

Now you’re ready for the final step to take control of your future and become your own boss. Being an entrepreneur is exciting, negotiating and closing the deal is a rush and gives a great sense of achievement.

Hard work and perseverance are a must but watching your business grow, increasing profits, and securing your own financial future is massively rewarding.

The final step is to decide how your company should be set up. There are two options, setting up as self-employed or as a Limited Company.

Many trades successfully using both types of setup but you must decide what’s best for you. Consulting an accountant and explaining your current situation, can be wise before you decide. An experienced accountant will help you make an informed decision and advise you on which financial records you need to keep. Most accountants will give you one hour of their time for a reasonable cost.

Keep the Tax Man Happy!

VAT is a big part of running a business and it’s extremely important to understand this as an entrepreneur and business person. If you expect your annual turnover to be £81,000.00 or more, you must register for VAT. One of the advantages of being registered is that you can reclaim the VAT you pay on goods you bought for your business but NOT on personal purchases.

An accountant will identify what you can claim for or go online to the HMRC VAT website.

If you anticipate trading with a turnover less than £81,000.00 you may register for voluntary VAT and reclaim VAT on goods you bought for your business.

Import Export Business Plan

As with anything in life, it’s important to plan. If you don’t make a plan and just make it up as you go along, you’re far more likely to fail. Make a plan and write it down.

The best way I’ve found to write a business plan is to work backward. I find it easier to start by answering the question, “What is my goal?” If you want to have an online shop selling the latest range of tech gadgets and toys, work backward from there.

You’ll need a website, so plan this, look at costs, find coders and designers as we showed you how to in our guide.

suppliers, so find the best suppliers using the tips we mentioned above, research, make contact, start to build a network, start talking to people.

You will need to know about freight forwarders and Incoterms 2020, so enroll in a training course so that you’ll be familiar with these terms and how now to lose your shirt when you stating trading on an international level.

You’ll need buyers. We all need buyers or there’s no business. So use our guide as a starting point and experiment with what you have.

There’s more that you’re going to need to think about and include but this is to get you started. Work backward and analyze what you’ll need to achieve your goal your dream. There’s no reason why you can’t achieve, just work hard, stay focused, be persistent, and don’t take no for an answer!

Build Your Own Website

Once you’ve sourced your products and established your product range, consider how you’re going to sell your products.  Check our blog post with some ideas and suggestions to finding buyers but also consider using the web and setting up you’re own website to export globally.

Your own website has several advantages as you can cut out the middle man from any direct sales and also act as a shop window for your company for any new suppliers you’ll contact making you serious and professional.

These days it doesn’t have to cost a fortune but we go into much more detail in our blog post on how to export globally.

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