So how can one get involved in an import and export business?
One: you can start an import and export business with your own money
Most people think of getting involved buying products abroad with their own money, at their own expense. This is the most logical and preferred way of most. Buy a product, pay for it, take ownership of the goods, import your purchases into the country where you want to sell them, sell them, and do it again.
Two: Import and Export Agent: Bringing Buyers and Sellers Together
If you are familiar with a particular country, especially if you have been there several times and may already know what is made there and where to find suppliers for those products, you can offer your knowledge to others. If, for example, you have been to Thailand many times, you may have lived there before and you know the Thai product, you can approach a buyer from a retail store in the United States, in the city where you live or elsewhere, and offer to be your buyer. Especially if you carry products from Thailand. In this case, the US-based retailer may contract with you to place an order for a product that it sells in Thailand. You will order the product in Thailand, set up the shipment, pay for the product not with your money but with your money, and ship the product to your store in the United States, with your store’s name as a consignment on the shipping documents. For your services, the US-based retailer-importer will pay you the agreed commission. The commission amount is negotiable, not a fixed percentage. The amount may depend on the amount of time you will spend putting together the shipment, the overhead associated with the export side of the process, the expenses you will incur in the home country, the need to travel to and from the manufacturer’s office. factory or deal with export shipping company. The retailer will be the importer, he will pay not only for the merchandise but for the cost of preparing the export documents, packaging and actual international freight from the country of origin, Thailand, to the destination, wherever your store or warehouse is. . Your commission can be a percentage of the total invoice value or an amount negotiated between the two of you. In this scenario, you are using other people’s money, but their expertise. You can start tomorrow. Obviously, if you have never been to Thailand, you may not want to offer your services as an import and export agent for Thai products.
There are two basic variants of this participation. One described above where your commission is paid by the importer on whose behalf you have worked. However, similarly, while you are in Thailand, a Thai manufacturer may offer you a sample of their product to present to potential buyers in the United States. In this case, you may return from your last trip to Thailand as a Manufacturer’s Representative, perhaps not with an exclusive contract to represent your products in the United States, but with the understanding that if you find a buyer for your product who wishes to make a order, he, the Thailand-based manufacturer, will pay you an agreed commission on the shipment.
From these two examples, it becomes clear that you can work with other people’s money, not just your own, bringing buyers and sellers together where one or both parties can pay you commissions, the buyer, as well as the seller and the seller. This method is the easiest way to get started in an import and export business.
Three: Import and export sourcing agent
You can work as an independent import and export sourcing contractor, a share in the import and export business that is in the same category as described above, but with more responsibilities throughout the import and export process. Let’s say, for example, a clothing store in the United States will hire you to find a manufacturer in Bali, Indonesia that can make garments to your product’s design specifications. Armed with the drawings of the product that the retailer gives you, I would look to more than one potential manufacturer in Bali to prepare samples of the product that the retailer will ultimately order in quantity. Each manufacturer would prepare the sample, as well as a quote sheet showing quantity discounts and lead time. The retailer would select one of the vendors you have contracted based on product quality, price, and delivery time, and then ask you to award the contract to that vendor. Then you would have to oversee production, quality control, document preparation, and pay for products with the retailer’s money, not you with yours, who would become the actual importer and consigned on the shipping documents. As stated above, the retailer-importer will pay you on a commission basis, plus expenses, and possibly keep it in advance so that it is available the next time.
Four: Export Shipping Agent
The latter is an example that relies once again on using other people’s money to bring buyers and sellers together. In this example, a manufacturer in Thailand offers a cargo container for a product, for example toys. The shipment is ready to ship and must be purchased as is, regardless of the style qualities of each item within. The shipment can be varied and may contain some attractive products but also some less marginal, perhaps even seconds, or discontinued products. The manufacturer-exporter is looking for a buyer. You are an agent who knows who may be interested, who are the buyers of these types of products. It could be a store in Miami, Florida or in Berlin, Germany, or in any other country where you know buyers of this type of product. Provides samples from the seller-exporter to the buyer-importer. If the buyer agrees to buy the container at the agreed price, you can handle the entire sale transaction in what could be a consecutive letter of credit using your bank in Denver or wherever you are. The buyer in Berlin pays you by L / C in the amount of $ 40,000 and once the funds clear at your bank, your bank cuts an L / C in the amount of $ 30,000 to the seller’s bank in Thailand and you keeps the difference less. banking expenses. The container goes from Thailand to Berlin, Germany, not through the United States; ownership of the merchandise is never taken. Just connect the seller with the buyer and negotiate the deal. It goes without saying that export shipment can be negotiated by countless other brokers who will come across the export offer from the Thailand-based manufacturer-exporter.