If you’re running an e-commerce business or even shipping out your brand of products to distributors, it’s likely that you’re going to be shipping products overseas at some point. This is especially true if things are going well and expanding. However, you shouldn’t simply choose a shipper and get going with it. There’s money to be made and saved if you think seriously about how you export your goods.
Know the market that you’re selling to
You should make sure that any exports to any new areas are treated with scrutiny, every single. Even if you’re already exporting to six countries, there could be new factors that come into play with your seventh country, such as the currency exchange rates, local taxes, value-added taxes, as well as local business etiquette that can affect your trade. Doing your research on the market that you’re expanding into is always important if you don’t want to spend more than you expect.
Finance your exports wisely
If you’re expanding your business to scale up the export process to a new country, then you are likely going to need funding. However, where you get that funding can make a big difference in your cash flow going forward. You should, for instance, look at the financial assistance for exporters that can offer you very competitive loans, such as the export-import bank or the international trade loan program small business investment company. Aside from more advantageous loans, these programs tend to offer multiple ways of making payments so that you can manage them in the way that suits you best.
Claim back what you pay on duty
You could be directly getting back the cash that you pay, but most businesses that have to pay a duty of exports don’t realize that they could be claiming it back. Making use of duty drawback for export, you could be claiming back the money you pay on duty, taxes, and fees associated with exporting goods. This includes both finished goods and assembled merchandise. Given that how many businesses are not aware of the fact that they can recover duty, you could be sitting on cash that you don’t know you have.
Get a good understanding of Incoterms
If you’re not aware, Incoterms are terms of sale that dictate the responsibilities of buyers and sellers. There are 11 different sets of incoterms and each of them can affect the affordability of your exports. Do your research on Incoterms and make sure that you understand them so that you don’t end up paying fees or costs that you would expect the buyers of your products to have to cover. You should never get into any business arrangement in which you aren’t fully aware of your costs, responsibilities, and rights, but a lot of people jump into Incoterms-based agreements without doing their due diligence.
Exporting your goods without too much thought behind it can lead to spending more money than you need to. Hopefully, the tips above help you hold on to some more of your cash while still being able to get your products out into the world.