Know All About The Import and Export Business in India
Facilitating the trade of goods within domestic and foreign companies is an import and export business. If you want to join this lucrative business on your own, then read along. This article will help you with minute details of the business.
Trading has been there since the ancient ages when people started exchanging goods to get their needs from different people, different regions, or different countries. They started trading by exchanging ancient items like food crops, animals, or homemade items.
But modern days trading deals with modern items. And this creates a scope of import and export business worldwide. It’s the process of how we can get our favorite foods, cars, dresses, and most items from foreign countries.
Imports refer to goods, services, and products brought in their own country, while export refers to selling their own country’s products, goods, and services to other countries. Now we are going through a complex web of international trading which is basically a chain of exporting and importing. This whole system handles the sale, distribution, and delivery of goods from one nation to another.
So if you are interested in this importing and exporting business industry and want to join this business on your own, then go through this article to get a clear idea of importing and exporting business.
This step-by-step detailed article will lead you to the various activities you need to do to start your own import and export business. Just undergo these processes, and stand your chance to rock the business.
How To Start Import Export Business In India
Here we are including a detailed step that will surely clear your doubts.
Getting a PAN Card
There are a lot of documents that are needed to start a business as well as import and export. One of the most important documents is a PAN card. You must have your own PAN card. It’ll work as your valid identity proof to start a business.
You have to register yourself with the income tax department with a PAN Card.
Select your Preferred Business Entity
You need to start making decisions on which type of exporting or importing you want to do. Then you must register your business and should give a name to your business of importing and exporting.
You can go for a partnership firm, a private limited company, or even a public limited company.
Opening a Current Account
A businessman needs a bank account which is specifically a current account. You have to open a valid current bank account on any of the registered banks in India.
You have to complete transactions with the customers and vendors through this account. Documents will be varied depending on your business type.
Getting an IEC Code
The IEC code is a must-have for an import and export business. You need to fill-up the form to apply for an IEC code. The application form for the IEC code will be filed with the Director-General of Foreign Trade.
Choosing your Exporting or Importing Product
Choosing an exporting or importing product can be a master blaster for the import and export business. This product can be a key to taking off your business as high as possible.
You need to keep in mind some variables such as the state of international markets, regulations, export trends, and many more. You can get these tips on several business-based websites, including google news.
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Registration Cum Membership Certificate (RCMC)
Registration cum membership certificate i.e. RCMC is one of the most important documents that you need to have while starting your own import and export business.
India has already some export promotion councils which can give you access to business events and assistance that can help you to grow your business rapidly. Not just that, you can get access to certain benefits under India’s Foreign Trade Policy.
This RCMC is valid across India. It will take nearly a week to get the registration under the council.
Search the Market Right For It
When you are done with the above points, now you need to find a place where you can sell your products. You have to find a knack to get the idea of potential trading trends.
You have to conduct research work to find out a potential foreign market where you can get your potential buyers for the products. You can get a breakthrough in your business if you find a proper place to sell your products that also in foreign countries.
We would suggest you do your study for import and export business in globalEDGE’s “Market Potential Index” and The World Bank’s “Ease of Doing Business”. Also, don’t forget to check the local government websites to go through the business resources.
These sources can help you to understand the products that are going from one country to another with how many values and social values.
Go for a Supplier
When you are determined to start your import and export business, you need to get a clear vision of the products that you are going to sell in the foreign markets.
You can go to manufacturers so that you can visit production on your own. You can find potential suppliers in Global Sources, Alibaba, and Thomas Register. These are the easiest ways to get access to the suppliers.
You can get more sites to get your suppliers. But these are best known for exporters, importers, high-quality suppliers, manufacturers, trade leads, buyers, and wholesalers.
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Pricing of Your Products
The most important step to getting into the export and import business is the pricing of the products. There are two steps that can be followed by you – firstly, Volume (number of units sold) and secondly, Commission on that volume.
You have to work on pricing in a way so that your commission will not exceed the customer’s budget and you will get your profit too. There is a standard in this import and export business.
10% to 15% markup over cost is taken by exporters and importers to get coverage of manufacturing price when you buy from the manufacturers of the products.
You will make, earn and gain more profit if you sell more. Keep in mind, your product’s pricing should be separate from the logistics charge.
Transportation for Products
When you are all set to sell your products to the customers, get ready to face the logistics- transportation of your products. You can choose a global transportation service that can serve all over the world to another warehouse from the factory door.
You can save your time by hiring such a service at a reasonable price. If you are a newbie international businessman, then you have no need to get the hurdles of taking care of the products. On request, they can serve for moving documentation and much more reliable services.
You can get freight forwarders online in international business journals, business-related newspapers. You can go for at least two to three transportation services that will be perfect for your business.
We want to suggest two names that can help you as you are a newcomer in the importing and exporting business industry- Fed Express” and “UPS”.
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Providing a Trustworthy Customer Service
When you are dealing with your overseas customers, you must be the best in customer service. Your relationship with your foreign customers should be a strong trustworthy one. You should continue contacting your customers even after a deal has come to an end.
You can go for a follow-up with your customer after a successful business deal. They can give some suggestions or they can give the product’s feedback.
You can go for a skype contact, or an email or telephonic conversation with your customer.
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Lio Automation gives you many amazing features that make your work super simple and effective. There are very many features that will help you and your business in various aspects. From connecting and staying in touch with your customers, to working together as a team, and everything in between, Lio Automation will truly make your business run smoothly and make it reach new heights of success.
If you are using Lio Automation for your business processes consider all your data safe and secure all the time. Not only is the data saved in the cloud, but it also offers a data versioning feature in which you can actually see the many changes the document or file has gone through and who has made those changes. You can save the version of the file as required by you.
Another great feature that Lio Automation offers is colour formatting the sheet. Colour formatting can help bring information and more clarity to the audience. Applying colours to different parts of any data will let you narrate a more effective story that easily catches one’s attention as well.
You can create dashboards for each file which would give you the clear details of your company’s operations, marketing campaigns, sales and other analytics. This is one useful feature that would truly make a difference to your business and help your see all the processes clearly so that you can make well-informed decisions.
Since customers are a big part of any business and staying in touch with them is a crucial job, Lio automation gives you the ability to automate Whatsapp communications. Automating WhatsApp communication is another popular trend that businesses can benefit from. With the help of this, you would be able to save a lot of time, boost your customer retentions and renewals, save a lot of money, have lower operating costs and much more.
Lio Automation also makes working in teams very easy with their Task feature. you can not just assign tasks to your team efficiently. You can set the priority of each task along with the due date. Your team will get a notification about the task automatically, even on Whatsapp, they can see their assigned tasks in the app, mark them complete, and you will get a notification on Whatsapp!
Not just this, Team management and work allocation are made super easy with Lio Automation. You can also work with teams in real-time and see all the changes happening.
You can share invoices and receipts with your customers while also sharing the payment links with them to make the whole transaction process smoother and absolutely hassle-free for everyone.
There are several other amazing Lio automation features that are made so that you and your business can benefit from them. Excited to know more about it? Start with your Lio automation process for your brand and start your journey to success.
Conclusion
So finally you have learned how to start and continue your exporting importing business. You are ready to throw operational activities on your own export and import business.
In my opinion with the experience, you will be experienced in how to tackle the drawbacks and challenges you are facing through the journey.
You are ready to bloom and make your stand in the foreign markets as well as your home markets.
Frequently Asked Questions (FAQs)
Is Import-Export a Profitable Business?
Import-export business is one of the most lucrative business ideas. There will be huge profits from this business. So with proper knowledge, you can go into this business.
How do I get Customers for my Export Business?
You can get Customers for my Export Business using these points-
– Conduct good high-level online research on international markets
– Try to invest in branding and promoting your business through websites
– You must be well-known in the local market
– Keep an eye on embassy fairs and economic changes in the local market.
What Documents are Required for Export?
A lot of documents will be needed to step into exporting and importing business. Such documents are:
– Air Waybill
– Bill of Lading and packaging
– Certificate of Conformity
– Certificate of Origin of the products
– Commercial Invoice for international business
– Dock/Warehouse Receipt
– Export License registered under government license
– Export Packing List
Is GST required for IEC?
As per the latest circular released by the Indian government, IEC is not mandatory for all traders who are registered under GST. But a PAN Card is a must-have document to be a certified trader.
How do you Promote Exports and Imports?
Whatever the business is, you have to promote your business in various ways. You can talk on social media sites like Facebook, Twitter, LinkedIn, and many more. There are a few ways to promote your business of importing exporting, such as:
– Talk to the people who are buying similar products or may be interested in your products
– Go and buy a similar product yourself to create trust in people’s minds
– Attend trade fairs and seminars and talk to potential customers about your products and services
– Learn local customs which is very important
6 Comments
Which products of India are higher in demand outside so that I can start an export business around it?
Hey Ashok,
Export business can bring you great revenue if you run it intelligently and perfectly. Products like mineral fuels, clothing, pharmaceuticals, raw ingredients, jewelry, and leather products are in immense demand outside of India.
Could you kindly explain the different stages of venture capital financing and how many there are?
Hello Ramesh,
There are generally five stages to any venture capital financing.
The Initial Stage
Venture capital funding begins at the seed stage, when the firm is frequently nothing more than a concept for a good or service that has the potential to grow into a lucrative enterprise in the future.
The Planning Phase
Companies in the startup stage are normally ready to start advertising and marketing their product or service to potential clients after finishing their research and development and developing a business plan.
The First Phase
First stage funding, commonly referred to as the “emerging stage,” frequently occurs in conjunction with the company’s market debut, just as it is about to begin turning a profit.
The Expansion phase
The expansion stage, which is also frequently referred to as the second or third stages, is when the business is experiencing exponential growth and requires additional finance to meet demand.
The Bridge stage
When businesses have reached maturity, they enter the bridge stage of venture capital financing. The money obtained here is often used to fund transactions like mergers, purchases, or initial public offerings. The company is essentially in a transitional phase before becoming a full-fledged, successful enterprise.
Absolutely loved this article!
And also, please explain what the IEC code is and why it is mandatory.
Hello Gayathri,
IEC, or “Import Export Code,” is a 10-digit number assigned by the Director General of Foreign Trade. All individuals involved in importing and/or exporting products or services from India must have a “Import Export Code,” which is a necessity. No person may export or import without first obtaining an IEC unless specifically exempted.