Starting an import business takes planning and an understanding of the process and regulations, as Alison Birrane explains.
A WILLINGNESS to seek advice from industry professionals and a grasp of the basics of the import business will help avoid the many potential pitfalls that lie in wait.
However, ensuring there is a market, and that you understand the financial aspects of importing goods, are important initial steps when determining if the products you intend to import will be competitive in the Australian marketplace.
When determining the total cost of importing goods, it is important to take into consideration costs of freight, insurance, import duty, GST, currency exchange, bank charges and interest, in addition to the cost of the goods.
The Australian Bureau of Statistics is a good place to start when undertaking market research on the products you intend to import for resale, particularly with regard to the market saturation of certain goods in the local market.
Having determined your market is viable, there are certain steps to follow to ensure all bases are covered before commencing the importation process.
A good starting point for prospective importers is Australian Customs, which provides information on legislation and import regulations. Another is the latest version of the International Trade Handbook produced by the International Trade Centre at CCIWA.
The International Trade Handbook is an annual publication released by CCIWA for the past 12 years that provides information on a range of issues, including importing.
The International Trade Centre at CCIWA has resources, including a library, where businesses can seek information on suppliers of goods for import. Other sources of assistance can be found on the Internet, from foreign consulates, banks, shipping agents and the Business Information Centre at the Alexander Library.
Before placing an order, apply to a customs broker who can advise on the classification of the type of goods to be imported, import duty rates, tariff concessions and quarantine requirements as required by customs.
You can often verify this information by checking Australian Customs’ web site www.customs.gov.au
During this time it is also appropriate to look into freight and insurance costs and to discuss financial considerations with the international division of your bank, such as financing the transaction, the method of payment and any bank charges that may be incurred.
Next, in conjunction with your customs broker, prepare a cost analysis including freight costs, warehousing, insurance, interest, bank charges, import duties, GST, and your profit.
Your customs broker will advise if there are any special requirements to be considered, such as certification for restricted goods, any import licence requirements or quota restrictions.
Australian Customs may also have standards concerning labelling and marking on packages entering Western Australia.
When placing an order with a supplier it is important to request written confirmation of the receipt and acceptance of your order, and to ensure that all terms and conditions of the sale are fully understood by both parties.
The price of the goods should be based on, and include reference to, Incoterms, which are the international rules for the interpretation of 13 trade terms used in international trade formulated by the International Chamber of Commerce.
Once the order is placed, advise your customs broker of the shipping details provided by your supplier and arrange for the goods to be cleared through customs, either by you or your customs broker.
You will need to provide the relevant documentation, such as the bill of lading, air waybill or commercial invoice.
Your bank will advise you when the shipping documents have arrived and it is up to you to determine that they are in order before accepting them.
Before taking delivery of your consignment of imported goods, ensure the quantity, quality and condition of the goods are satisfactory.
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