One of the most common questions we’re asked by entrepreneurs thinking about getting involved in importing and exporting is, “how to find buyers for my exports”. There is no single or straight answer to this question, as you can imagine it depends largely on what your exporting and to what country or region. In today’s post we’ll show you 6 ways to find buyers.
6 Ways to Find Buyers:
Test The Market With Retailers Such as Ebay, Amazon and Etsy
Google Search for “Wholesalers of {My Product} Chennai”
It’s wise to spend time researching the market online for your export in various countries and areas before you take the leap. Ask questions on forums, Facebook groups and any other ways of getting some opinions from local people. This will be valuable as you can’t beat the feedback from local people who live and work in your target area. Asking about pricing and even product opinion can be very beneficial feedback.
YouTube: Finding Buyers and Closing the Deal
In the YouTube video below, Alan Bracken, offers practical advice, finding buyers for export and best tips on how to close the deal, reviewing his 35+ years of experience and hundreds of deals that he’s been involved with.
Do It Yourself
With so many websites now online that allow you to sell your own products, why not consider listing your products? The biggest and most well known are Ebay, Amazon and AliExpress and as they’re international this is a great place to start. Register an account and add your products to these sites and see if you place any orders. If you do, you can be more confident about demand for your product in that country or area.
There are many smaller but well known sites online that specialise in smaller retailers and handmade goods such as Etsy and NotOnTheHighStreet in the UK. A small amount of research for your target country I’m sure will reveal others.
Best Practice
If you take this approach, it’s worth spending some time studying the best practices for listing your products so that you can take full advantage. For example, make sure photos of your products are well lit and show enough detail. Take photos from various angles so potential buyers can clearly see all of the product and consider even developing a short promo video. Write a descriptive title and description and answer any of the most common questions about the product so users don’t have to contact you and wait for a reply in order to get the answer to their question. When they’re ready to buy, you want to make sure there are no obstacles in the way and they “Buy Now”.
Customer Service
Make sure you offer an excellent level of customer service. Answer questions promptly, when you have your confirmed orders, ship your goods quickly and don’t delay. Update the customer with shipping and tracking codes so they can keep track of where the delivery is. Zappos has sold over a billion dollars in shoes and it built this off the back of excellent customer service. There is a lot to learn from Zappos and how they made customer service their priority and in return their customers gave them loyalty.
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We All Read The Reviews
In return for great customer service, ask for a favorable review which are obviously important for credibility. This gives your next potential customer confidence, not just in your product but your service. With some good reviews, they may not hesitate to click the “Buy” button.
Bringing It Together For Wholesale Export
Once you’ve sold some products and built up a base of customers and good reviews you can use this to a second advantage. Contacting wholesalers and having a credible track record can be a big advantage. To be able to say that you’re already selling your products in the local market reduces risk to the wholesaler. If you can say that you’ve already sold “X” number of products in their country and you have “X” number of positive reviews that your potential wholesaler can verify, this is a great way to begin a pitch of your products and will no doubt get the attention of both wholesalers and retailers.
This begs the next question of how to find wholesalers and retailers for your products?
Google Search
It may sound obvious but Google as we know is the king of search so start here. For example, if you are exporting rugs or carpets from Turkey, perform a Google search on “rug wholesalers in Mumbai”.
You’ll get plenty of wholesalers that you can contact and see if you can generate any interest in your products. Wholesalers received many emails and calls, being offered products all the time, so try and stand out from the crowd. A well written email, with clear and professional photos of your products is a good start. We will write another blog on the best approach to contacting buyers and wholesalers.
Follow The Kompass
Kompass is an online business to business directory, with more than 20 million companies, in 70 different countries. This is a great business resource and have a good chance of finding buyers for your exports within its listings. The information is not free and you have to buy lists of companies but the contacts are a great place to start.
National Embassy’s
This is more of an old school approach but still relevant. National Embassy’s want to promote trade between their country and the world and are there to help create these links. Contacting the commercial section of a country’s embassy and asking if they can provide you with a list of wholesalers of your export product is well worth doing.
This also works in reverse, if you are looking to source particular products from a country, contacting the embassy of that country is a good idea. For example, some years ago, we had an entrepreneur looking to source pine furniture to import to the UK and sell. He contacted the Cypriot embassy in London, where he was based and asked if they could help. Cyprus has many pine trees and is well known for its furniture so this was an obvious place to source. The embassy was happy to help and promote its exports and give a list of reputable and well established factory wholesalers and our entrepreneur went on to negotiate some great deals and setup a successful business.
Chambers of Commerce
Chambers of Commerce (e.g. Indian Chamber of Commerce) are another good resource to make contact with, much like national embassy’s. The Chambers want to promote international business and commerce and have close links with many industries and companies in local areas. They can offer advice and help and often support businesses by offering training so are able to certainly push you in the right direction.
Import Export Training Course Online
If you’re looking to break into international trade as a career or setting up your own business, ABTS® Training offers online import export courses, taught with a series of pre-recorded videos. Study at your own pace, no deadline to finish and lifetime access to your course.
Our courses teach you the practical knowledge you’ll need to know to trade successfully, confidently whilst maximising your profits. Taught by Alan Bracken, with 35+ years of commercial experience in logistics, he skips all the theory you’ll never need to know but teaches you the practical side of how to move your goods around the world.
Our new “Start Your Own Import Agency Business” course teaches you practical lessons you need to know as an agent. Developed by ABTS®, with over 35+ years of experience in international trade.
Trading as an agent himself for many years, Alan Bracken teaches you how to be a successful agent in the real-world. He explains how to control costs and maximise profitability as well as how to choose the best type of agency for you, how to negotiate and sell and move your products.
When looking to become an import export agent, it’s sold to many as a quick way to make money without having to do much work. Link up buyers and sellers, negotiate a deal and get paid, this is how easy some think it is. The reality is somewhat different and I’m going to give you the whole picture. Here’s what we’re going to cover.
How To Become An Import Export Agent:
Find A Product You Want To Represent
Build a Range of Products
Make Sure Your Product Knowledge is 100%
Do Your Competitor Research
Make Sure You’re Aware of Any Safety Regulations
Establish What Territory You Want To Represent (Local, National or International)
Understand Circumvention Clauses
Make Sure You Get Samples
Make Sure You Have Promotional Material
Know What Commission Rate You Want Going Into Negotiations
Become an Import Export Agent – The Basics
The following video explains the basics of how to become a SUCCESSFULL import export agent with down to earth, real-world advice.
Alan Bracken addresses what you need to know if you’re thinking about becoming an export agent by setting realistic expectations. With over 35 years of experience in international trade, Alan gives his advice on what you need to know and consider before diving into setting up an agency:
Should you setup as a limited company or self employed?
How much time will you need to dedicated to your new business?
Identify your start up costs.
Identify your products
The importance of market research
Before we get into our top 10 tips, let me give you a little heads up about the the reality of your new import export business.
Two years ago I was in Dubai lecturing at a local college and presenting our own import export training course at seminars and to various local trading companies.
I noticed in the hotel lobby, an advertisement for a course entitled “Become a Successful Import Export Agent”. The title caught my attention and out of professional curiosity I purchased a ticket for $15.00. The course was a half day course, from 9 am t to 2 PM with a 15 minute coffee break.
There were four very smartly dressed people, presenting the meeting and we were told in rapid succession by all four presenters there was a fortune to be made as an import export agent, with little or no financial investment and minimum knowledge of International trade. We were then told that once we enrolled in the course, we were on our way to success. As one speaker put it “ The sooner you start the sooner you’ll be rich”.
Each of the four presenters in turn, told us that they were originally working dead end jobs making money for their boss, living the usual rat race, living week to week, hand to mouth.
Import Export Agents Needed
By becoming import export agents, this gave them the financial freedom and lifestyle independence to do whatever they wanted. All that was missing was the photos of each of them with a Ferrari. As you may imagine, this went down very well with most of the paying audience. Who doesn’t love the idea of making great money with no financial investment, little risk and you don’t have to study!
We were told it was so straight forward, a child could do it. All that was involved was find a buyer and seller, introduce them to each other and “hey presto” we get a big fat commission for little or no work. For every buyer, there’s a seller and our job is just to match them and then wait for a chunk of money to hit our bank account. Lovely!
An Import Export Agent Doesn’t Need Money
However…even though there was little to zero financial outlay, virtually no risk to setup our new wonder business there was one small initial outlay that we would have to pay up for. You’ve probably guessed it, $800 for their course that would teach us the golden secrets of how to get rich quick as an import export agent.
To prove just how simple this process was, we were given a photo copied sheet of paper with a list of names who were apparently “buyers”, of course with all their contact details blanked out, with a corresponding list of sellers and the products they have to sell but again with their contact details omitted.
Once we paid the $800 fee, we would get the full list of names and addresses and even an example letter that we can copy introducing our buyers to our sellers. What an offer, all the work is done for us, we just have to copy a few letters and send them off and we should be in business, ready for our bank accounts to fill up.
I had visions of myself as a dragon on Dragon’s Den, with stacks of cash on my kitchen table as I eat my breakfast each morning, contemplating what I’m going to buy next.
The final clincher was that by paying out our hard earned $800, we would also receive a fabulous “HOT TIPS” guide! Although we were not enlightened as to what any of these hot tips may be.
The audience at this point was not a rush to join up but these four presenters worked their charm for the next couple of hours or so, telling us that it was the best investment they would ever make and if they didn’t do it today, they will miss out forever.
Can An Import Export Agent Be Cut Out?
In an effort to try and shed some light on how this get rich quick scheme may not be quite so easy, I offered a question, “How can I be sure the buyer and seller don’t just cut me out after the first deal and deal directly with one and other?” In a dismissive tone, the presenter replied, “This very seldom happens, so don’t worry”, then moved on to the next question. Fantastic, let’s pay the $800 then as it hardly ever happens.
At this point after several hours of being told how easy life as an import export agent is and the riches it will produce, the sentiment of the audience had changed and they were on board. Who doesn’t love the idea of making an “easy buck” as they say.
At 2pm the presenters let us know that this was their last seminar in Dubai for another year so, just for us, they would make a special offer of $600.00 to enroll in this super duper life changing course. I managed to leave the room soon after 2pm but as I left there was a line of people signing up for the “special offer”, eagerly anticipating all of the profit they were about to make.
Import Export Agent Training – Realistic Expectations and Honesty
I felt for those people queuing up to make their fortune but first having to spend $600 of their hard earned money. Not because they’re signing up to the course itself or because being an import export agent can’t bring you excellent profits but because their expectations had been mismanaged.
If you want to become an import export agent, it will take some financial investment, it will take time and effort to build relationships with buyers and sellers, you’ll need to learn to negotiate with them, you’ll have to study and understand the implications of acting as a stockist or commission agent and you absolutely must understand in its totality how to trade on an International level.
You will encounter problems, as you will with any business and you must know how to solve these problems quickly and efficiently. You must know where your risks lie and once you grasp these concepts, then you can run a profitable business as an import export agent with a healthy profit margin.
Spending money on a course that promises you quick riches is probably never going to be a good thing. Sure, spend money on courses and educate yourself but also have realistic expectations. Any business you setup is going to take some elbow grease, some investment, study and determination. There is no way to get rich quickly or easily…or we’d all be doing it.
By the way, the correct answer to stopping a buyer and a seller from cutting you out as the commission agent is to include a “circumvention clause” in your contract, which is a fundamental clause in this sort of situation.
Become An Import Export Agent The Right Way
Firstly, becoming a successful import export agent is what we need to be focused on and for this become a reality, like anything in life, it’s going to take some hard work, time and dedication. As we all know, any new career or skill that we want to learn is always going to take effort and some form of dedication. Nothing worth pursuing comes easy or for free. It’s unfortunately not as simple as working from home for a few hours each evening.
Product knowledge is paramount, hard work and understanding international trade are all key parts of making a success of becoming an import export agent. Honing your negotiation skills, understanding international methods of payments and an understanding of international contract law are very wise.
Two Types of Import Agent
The good news is, there’s always companies looking for import export agents. Below are the import export agent job description for the two types of role you can opt for. You’ll have to decide which one is appropriate for you with the products that you decide to represent.
Commission Agent
A commission agent introduces a buyer to a seller and receives a commission for sealing the deal and continues to receive a commission for any future sales from that same deal. As a commission agent you’ll be dealing with buyers who want the product but likely don’t have much knowledge of international trade, which Incoterm to purchase under, best method of payment nor custom clearance procedures. This is where your knowledge becomes invaluable and you’ll be able to hold their hand through to whole import export process and this is where you earn your import export agent commission with confidence, professionalism and the best possible terms for you.
Stockist Agent
As a stockist agent, you will actually buy the goods or products yourself, keep and store those goods, find buyers yourself and sell them to anyone you want. You could sell regionally, nationally or internationally. To become a stockist agent you must have an in depth understanding of international trade and the entire import export process from start to finish.
As an example, we had a student who completed our online course and has begun importing very modern home security cameras with motion detectors that record to the cloud. These cameras are imported from Hong Kong where they are manufactured and being sold online and to various retail shops throughout the UK. This young entrepreneur now has a small team of sales reps that pick up stock and sell throughout the UK for him once a month.
FREE Import Export Training
Learn how to start your own import export business.
10 Golden Tips To Become An Import Export Agent
So, here’s our top 10 tips to becoming a successful import export agent:
Step 1: Search For A Product You Want To Represent
Establishing what you want to sell, finding a supplier, manufacturer or a source of products is obviously where you need to start in order to become broker for them.
One effective method of sourcing is by contacting the embassy of the country you wish to source from. For example, if you are sourcing products in China, contact the commercial section of the Chinese Embassy in your country and ask for a list of Chinese manufacturers and suppliers of the product you want to represent. This is an effective way to source products internationally.
Another effective way to source products is to contact overseas trade fairs and ask for a list of companies exhibiting at the trade fair. For example, if you were looking to become an agent for children’s clothing, try Google’ing “children’s clothing trade fairs in China”. You’ll be able to put together a list of dates, locations and contacts. If possible, visit the trade fairs that you can and get talking to people and start to build a network.
If you can’t attend the trade fairs, contact the organiser and ask for a contact a list of all exhibitors which they are usually more than willing to give you. Then you have a pretty comprehensive list of manufacturers you can contact and add to your network.
I have personally used the methods over the years and they have thankfully brought me some great results.
Step 2: A Range of Products
Develop a range of products from either your chosen supplier or consider finding a range products that fit well together, from multiple suppliers. The big advantage to this strategy is when you are in front of a potential client, pitching your main product, it can convince them to buy from you if you can back it up with a range as they may see more opportunity to sell the range, therefore earn more profit. The other advantage is, should your potential client not be interested in your main product, you may find that they are interested in another in your range. By having a range of products, you’re increasing your chances of a sale and expanding your sales network.
Step 3: Product Knowledge
Do you have sufficient knowledge of your product? You’re not necessarily expected to know every single detail about your products and be able to answer every question but you do need to have a good understanding of the product, how it’s manufactured, cost of production, wholesale price, retail price, profit margins etc.
You must be able to pitch your product with confidence and a depth of knowledge. If you then don’t know an answer to a specific question, you can always reply “I’m not 100% sure of the answer, so I’d like to check that and come back to you.” You can then make sure to get the correct answer and answer the question in a follow up email the next day, maintaining contact and dialogue.
However, this only works if you’re unsure of the odd question or two. You won’t be able to give this answer for all the questions, or you’ll look completely unqualified and make your products look weak.
Establish what product education and knowledge you’re going to receive. Training videos, webinars, video calls etc. are all great ways to get yourself up to speed.
Step 4. Research, Research, Research.
Know your market – this is so important.
Who else is importing and wholesaling your product(s)?
What’s the wholesale price of your competitors?
Who’s retailing your product(s)?
What is your product(s) retail price?
What can you do to make your pitch better or different from your competitors?
How can you make your service better that your competitors?
With this basic information, as yourself, “can I compete as a stockist or commission agent on price and delivery?”.
Run your numbers, do the numbers add up and is there a profit margin that you can work with?
Find your niche, find something that you can specialise in, become the leader, the expert, in that area and build a solid foundation from here.
Step 5: Safety Regulations
This is an important step that many overlook and can be very costly if not considered. Does your products comply with health and safety regulations in the country that you’re selling?
Imagine finding your products, pitching to clients, negotiating a deal and importing your products to find out they’re not compatible with health and safety regulations, can’t be sold and are held up at customs. This will likely add substantial cost and untold stress and there’s a decent chance that your profits will be wiped out or worse, you’ll make a loss on the deal.
Do not neglect this step, it’s not worth it.
Step 6: Mark Your Territory
Establish what territory you want to represent, perhaps become a national import agent UK or maybe International. It depends on what your goals are, what capital you have and to a large extent, how big your network is.
If you’re starting out, have limited capital and a small network, just work within your region. As you grow in all aspects you could start to look at a national network. Take it a step at a time but you may be surprised how fast your network grows.
Step 7: Circumvention Clause
Make sure a circumvention clause is included in your contract, which is a legal means of stopping the buyer or seller excluding you from future sales as the commission agent.
Step 8: Samples
You’ll likely need samples to promote and demo in your pitches and meetings. It’s much harder to sell if you don’t have a working version of your products to demo. So, establish if your supplier will provide samples to you free of charge, or at what cost.
Step 9: Promotion Material
What promotional material, if any, does your supplier have? Product images that can be emailed to you so you can add them to your website and advertise on Facebook. Be sure these images are clear, professional and represent the product and your brand well.
Videos are an effective way to show your product if professionally produced so find out if there are any available to you.
Product brochures are good to leave with potential clients after a meeting, with a breakdown of costs, prices and profit margins.
Step 10: Your Commission
Lastly and perhaps most importantly, what rate of commission will you negotiate? Your commission obviously has to make it worthwhile to you so it’s important that you know all your costs and what your bottom line is. This is where knowing how to export is so important as if you get this part wrong, it can obliterate your profit margin.
Import Export Training Course For ₹5,999
Learn how to become a successful import export agent by enrolling in our brand new course. Check out the course syllabus, a course that streamlines what you’ll need to know to be successful using practical, real-world knowledge, for just ₹5,999.
Our courses teach you the practical knowledge you’ll need to know to trade successfully, confidently whilst maximising your profits. Taught by Alan Bracken, with 35+ years of commercial experience in logistics, he skips all the theory you’ll never need to know but teaches you the practical side of how to move your goods around the world.
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’s a few tips and ideas on what to think about as you start your import export business venture:
Product Testing: Is Your Product Hot Or Not?
Find The Best Products For The Lowest Price
Get Samples From Suppliers
Safety In Numbers: A Range of Products Earn Bigger Profits
Understand Agencies
Learn How To Negotiation: The Art of The Deal
Learn How To Find Buyers!
Understand Incoterms 2020: Code Words for Logistics
Find A Freight Forwarder
Understand Marine Insurance: For When Disaster Strikes!
Remember Your Terms and Conditions
Setup Your Company The Right Way For You
Write Your Business Plan
Keep the Tax Man Happy!
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 setup 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 inevitably, 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 ides from six countries below to get you thinking.
Many are eager to jump right in, buy stock and start selling, however before you dive head first into your import export business and spend your hard earned money on 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 programmes where budding inventors and entrepreneurs think they have the most revolutionary idea or product but the wise investors don’t see it and shoot it straight down! Just because you like a product it 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 its 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
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 pricing 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 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 market place?
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 as 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 centre of global trade. Sourcing from companies in Preferential Trading Countries (PTC) can be a much easier and cheaper way to go.
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 supplier 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, check 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 complementary 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 which is 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 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 an negotiating strategy. Here’s 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”.
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 half way to building your import export business empire. Get this wrong, you’re going to lose money!
There are eleven different terms of delivery: EXW-FCA-CPT-CIP-DPU-DAP-DDP-FAS-FOB-CFR-CIF. These are referred to as Incoterms 2020. Check out our blog post covering “Incoterms: Think Codewords For Logistics” for more understanding.
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 know how to use a freight forwarder. Eventually, you’re going to need to use one, you’ll outgrow the post office, the bigger your shipment size of your import and exports, so it’s worth understand how they can help you and what to be aware of.
Be aware of and how you can protect yourself from being over charged. 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 you 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 sellers warehouse to the buyers warehouse, therefore it offers “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 insurance of your goods is vital to running a successful import export business.
Don’t Forget the Terms and Conditions
Terms and conditions of trade are possibly the most fundamental part of 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 an 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 you 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 is 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 setup. There are two options, setting up as self employed or as a Limited Company.
Many trade 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 which financial records you need to keep. Most accountants will give you one hour of their time for a reasonable cost.
Import Export Business Plan
As with anything in life, it’s important to plan. If you don’t make a plan an 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 backwards. 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 toy, work backwards from there.
You’ll need a website, so plan this, look at costs, find coders and designers.
You’ll need 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’ll 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.
There’s more that you’re going to need to think about and include but this is to get you started. Work backwards and analyse 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.
Your own website has several advantages as you can cut out the middle man from any direct sales and also acts as a shop window for your company for any new suppliers you’ll contact making you serious and professional.
Be Your Own Boss – Get The Right Training
There’s more to learn to fully run your own import export company but this should give you some good ground work. Once you’ve thought about these points and written down your ideas and made notes after doing your homework, you’ll be in a much stronger position to get going.
It’s hard work but the challenge is rewarding once you start the get the first coupe of deals done. You’ll grow in confidence and be able to streamline each part of your supply chain as well as learn the best avenues for selling your products.Many people start their businesses without being aware and unfortunately, will fold within the first 24 months suffering the loss of all the money they invested.
In order to really understand all aspects of trading globally, check out our online International Trade course. It’s a “to the point”, all-in-one course that teaches you exactly how to import and export in the real-world. No logistical theory, just streamlined content taught with a series of entertaining animated videos, validated by the London Institute of Shipping and Transport.
My 5 Biggest Money Deals
Now you’ve digested all of that, I’ll address a question I’ve been asked by many, as they consider getting into the import export business, what were my five biggest “earners”. So to answer that question, I have added a video on YouTube and discuss some of the details of my five biggest deals:
Supplying And Constructing a Leisure Centre in Libya
Importing Raisins from Turkey to major UK supermarkets
Acting as a Stockist Agent For Door Security Alarms From Hong Kong
Supplying Baby Cot Covers From Italy To Major UK Outlets Including Harrods of London
A Contract To Supply And Ship A Variety Of Second Hand Construction Equipment To UAE
Import Export Business Opportunities
As with any small business venture, sometimes we need help getting ideas together as a kick start to moving things to the next level. In setting up export businesses, the first question is always, “What can I import and sell?”. Finding a niche or a gap in the market takes some time and research but there’s generally a market out there for everything.
There’s literally a world of opportunity within international trade and the best part about it is researching what’s out there to import and sell at home, is the chance to travel and discover amazing products from other cultures and countries. Before you know it you’ll be an international trader running a successful business selling quality products from every country!
Well, let’s take one step at a time, so pack your bags and grab your passport, here’s some ideas to get you thinking from six countries.
India
Leather Products
Leather is a prominent industry in India with leather also being one of the most widely traded items in the world, always in demand and can be considered ageless. Shoes and coats never go out of fashion and can last for years, so becoming an export merchant for this niche may not be a bad idea. Leather purses, bags, briefcases, belts, wallets, gloves, the list goes on, there is a huge range of products to import.
There are more than 1000 leather exporting companies in India, making it arguably one of the best import export business in India. Some of the prominent players are Prara Leathers Private Limited, Rahman Industries Limited, Farida Prome Tannery Private Limited, Tata International Limited, Super Tannery Limited and Blue Diamond Leaders.
ABTS® Training also has a contact in India that has joined our Facebook group offering leather goods and handicrafts.
India has long been considered to be the hub of the global jewelry market because of its low costs and and highly-skilled labour. India is the world’s largest cutting and polishing centre for diamonds. The gems and jewelry market in India is home to more than 300,000 players, with the majority being small players, so this is a great opportunity to go to India experience the culture, speak to jewelry dealers and see what opportunities are there.
Jewelry is such a huge market in India with a market size of US$75 billion as of 2017 and is expected to reach US$ 100 billion by 2025, there’s no reason why you can’t take a piece of the pie and start trading in jewelry.
Egypt is famous for having the highest quality cotton in the world and is always in demand, worldwide. Production using fine Egyptian cotton includes shirts, fabrics for trousers/shorts, worsted wool fabrics, denim, fleece, jersey, flat/woolen knits and much more. Apparel production includes active sportswear, outerwear, underwear, suits, socks, infant wear etc. Production of arguably the most famous use of Egyptian cotton includes a wide variety of bed sheets and bath towels.
Perfumes and Cosmetics
Egypt was once the prestigious center of the international perfume industry. Perfumes were created and mass-marketed elsewhere in the ancient world but it was Egypt that was most renowned and identified with the international perfume trade.
80% of the world’s natural jasmine products, come from Egypt, where specialists in this ancient art extract the aromatic oils from a profusion of flowers, leaves, roots and herbs and export them to perfumers in Paris, London, New York and even Moscow. Egyptian perfumes is a huge export market with some great opportunities.
Nigeria
Locally Made Weaves
According to some estimates, Africa’s dry hair market, this being the market for weaves, wigs and hair extensions, is right now worth over $6 billion a year and growing rapidly. Western countries, particularly the US and UK are in high demand of weaves and will pay top dollar for real human hair. Incidentally, Thailand is also a great source for real human hair, sold in many of the markets for very reasonable prices.
Ginger, Garlic, Sesame Seeds and Nuts
Nigerian exports of nut related produce including oil seed, oleagic fruits, grain, seed, fruits is massive. Sesame seeds are in much higher demand too being that Sushi restaurants are now so popular. Ginger is one of the most traded spices in the world and Nigeria has an abundance. Starting a Trans-Sahara or Trans-Atlantic trade with these products will be profitable but take some research and time to find buyers for your exports. Garlic is also on top of the list and is easily exportable from Nigeria.
If you’re getting a taste for an importing business and serious about import and export, sign up to our free training, ” How to start import export business. “
Turkey
Knitwear
Exports from Turkey are exploding with 2018 setting a record year of $168.1 billion, demonstrating the high level of demand for Turkish products. Turkey is one of the world’s leading manufacturers of knitted fabrics, having the largest share in Turkish industrial production and being one of the first established industries in Turkey. Turkish knitwear is known to be of the highest quality with worldwide competitive pricing making it an ideal product to import. The potential for solid profits within this textile is huge.
Carpets
One of the world’s most prominent carpet manufacturers, Turkey is continuously expanding its global market share with increasing exports year-on-year. The Turkish carpet industry is renowned worldwide due its superior-quality products and advanced technology in production. Turkey currently holds a 15 per cent world market share in carpet trade and ranks in the number two spot behind China who takes the top spot.
Thailand
Mobile Phone Accessories
In every mall, high street and market stall, there are shops selling just mobile phone accessories. From unique looking earphones, crazy and cool phone cases, to selfie sticks and battery packs the appetite for the latest, coolest phone gadget is is enormous, worldwide. Importing these products is a great opportunity and the cost of these products in Thailand are significantly lower than other countries worldwide, coupled with quality craftsmanship.
Shoes
Shoe shoppers love Thailand! There are a gazillion varieties of shoes available in Thailand and at great prices. Importing shoes is a relatively safe investment as demand is stable and profit margins are solid. Street markets and local retailers are a good place to start when it comes to finding buyers.
South Africa
Wine
South Africa’s wines are held in very high esteem but South Africa is not taking full advantage of and could export more wine to the rest of the world. With a weaker currency, South African wines are comparatively cheaper to those of other countries with stronger currencies. South Africa is currently the 12th biggest exporter of wine, with wine exports of SA bringing in $661.6 million. However, South Africa’s wine exports was the 2nd cheapest of the top 13 wine exporting countries in the world. This is an export market waiting to be taken advantage of and will likely see comfortable profits.
Gems and Precious Metals
South Africa Exports of Pearls, precious stones and metals was US$14.9 billion in 2018. Needless to say there is always a demand for diamonds and gold around the globe. The nations with the highest demand are Japan, USA, UK, Hong Kong, Germany, UAE and Belgium.
