Import Export Procedure

Import Export Procedure

Import Export Procedure

Import And Export Procedure, Financing, and Primary Consideration Of international shipping documents..

Import Export Procedure Introducing: Firms engaged in international trade face a problem – they have to trust someone who may be very difficult to track down if they default on an obligation.  Due to the lack of trust, each party to an international transaction has a different set of preferences regarding the configuration of the transaction. Firms can solve the problems arising from a lack of trust between exporters and importers by using a third party who is trusted by both–normally a reputable bank.  A bank issues a letter of credit, abbreviated as L/C at the request of an importer.  It states that the bank promises to pay a beneficiary, normally the exporter, upon presentation of documents specified in the letter of credit.  A draft (bill of exchange) is the instrument normally used in international commerce to effect payment.  It is an order written by an exporter instructing an importer, or an importer’s agent, to pay a specified amount of money at a specified time.

14 Steps for conducting export transaction

The entire 14-step process for conducting an export transaction is summarized.  Take for example an Indian importer and US exporter.

Step 1: The Indian importer place an order with the US exporter and asks the American if he would be willing to ship under a letter of credit.

 

Step 2:  The US exporter agrees to ship under a letter of credit and specifies relevant information such as price and delivery terms.

Step 3:  The Indian importer applies to (e.g.) State bank of India for a letter of credit to be issued in favour of the US exporter from the merchandise the importer wishes to buy.

Step 4: The state bank of India issues a letter of credit in the Indian importer’s favour and sends it to the US exporter’s bank, the bank of New York.

Step 5:  The bank of New York advices the US exporter of the opening of a letter of credit in his favour.

Step 6: The US exporter ships the goods to the Indian importer on a common carrier. An official of the carrier gives the exporter a bill of lading.

Step 7:  The US exporter presents a 90 day-time draft (bill of exchange) drawn on the State Bank of India, in accordance with its letter of credit and the bill of lading to the bank of New York. The US exporter endorses the bill of lading so title of goods is transferred to the Bank of New York.

Step 8: The bank of New York sends the draft and the bill of lading to the State Bank of India.  The State Bank of India accepts the draft, taking possession of the documents and promising to pay the now accepted draft in 90 days.

Step 9:  State Bank of India returns the accepted draft to the bank of New York.

Step 10:  The bank of New York tells the US exporter that it has received the accepted bank draft, which is payable in 90 days.

Step 11:  The exporter sells the draft to the bank of New York at a discount from its face value and receives the discounted cash value of the daft in return.

Step 12:  State Bank of India notifies the Indian importer of the arrival of the documents.  He agrees to pay the State Bank of India in 90 days.  State Bank of India releases the documents so the importer can take possessions of the shipment.

Step 13:  in 90 days, the State Bank of India receives the importer’s payment, so it has funds to pay the maturing draft.

Step 14:  In 90 days the holder of the matured acceptance i.e. bank of New York presents it to the State Bank of India for payment. The State Bank of India pays.

Export Assistance

Exporters in the Indian can draw upon two types of government-backed assistance to help finance their exports; the Export-Import bank and Export Credit Guarantee Corporation (ECGC) The Export-Import Bank (EXIM BANK ) is a public sector financial institution established in January 1 ,  1982 . It was established by an act of parliament for the purpose of financing, facilitating, and promoting foreign trade in India. Export Credit Guarantee Corporation (ECGC): this institution covers the exporter against various risks. It also provides guarantees to the financing banks to enable them to provide Adequate finances to exporters.

Export Import Primary Consideration

It will discuss the preliminary considerations that anyone intending to export should consider. Before beginning to export and on each export sale thereafter, a number of considerations should be addressed to avoid costly mistakes and difficulties. Those companies that begin exporting or continue to export without having addressed the following issues will run into problems sooner or later Products initially, the exporter should think about certain considerations relating to the Product it intends to export.  For example, is the product normally utilized as a component Ina customer’s manufacturing process? Is it sold separately as a spare part? Is the product a raw material, commodity, or finished product? Is it sold singly or as part of a set or system? Does the product need to be modified– such as the size, weight, weight, or colour-to be saleable in the foreign market? Is the product new or used?  (If the product is used, some countries prohibit importation or require independent appraisals of Value, which can delay the sale.) Often the appropriate   methods of manufacturing, marketing, the appropriate documentation, the appropriate procedures for exportation, and the treatment under foreign law, including foreign customs laws, will depend upon these considerations.

Volume

 What is the expected volume of export of the product? Will this be an isolated? Sale of a small quantity or an ongoing series of transactions amounting to substantial Quantities? Small quantities may be exported under purchase orders and purchase Order acceptances. Large quantities may require more formal international sales agreements: more secure methods of payment: special shipping, packing, and handling procedures: the appointment of sales agents and /or distributors in the foreign country: or After-sales service.

Country Market and Product Competitiveness  Research On many occasions, a company’s  sole export sales business consists of responding to orders from customers located in foreign countries without any active sales efforts by the company. However, as matter of successful exporting, it is imperative that the company adequately e valuate the various world markets where its product is likely to be marketable.  This will include review of  macro-economic factors such as the size of the population and the economic development level and buying power of the country, and the economic development level and buying power of the country, and specific factors, such as the existence of competitive products in that country.

 Identification of Customers:  End user, Distributors, and sales Agents Once the countries with the best market potential and the international competitiveness of your company’s products have been evaluated, the specific purchasers, Such as end users of the products, sales agents who can solicit sales in that country for the products, or distributors who are willing to buy and resell the products in that country, must be identified.

Compliance with Foreign Law

 Prior to exporting to a foreign country or e3ven agreeing to sell to a customer in a foreign country, U.S. company should be aware of any foreign laws which might affect the sale. Some specific examples are as follows:

Industry Standards

Foreign Customs Laws

Government Contracting

Buy American Equivalent Laws

Exchange Controls and Import Licenses

Value-Added Taxed

Specialized Laws

IMPORT-EXPORTS DOCUMENTATION

 Introduction:  Although the sales agreement is by far the most important single document in an export sales transaction, they are numerous other documents with which the exporter must be familiar. In some cases, the exporter may not actually prepare such documents, especially if the exporter utilizes the services of a freight forwarder. The exporter is responsible for the content of the documents prepared and filed by its agent, the freight forwarder.  Since the4 exporter has legal responsibility for any mistakes of the freight forwarder, it is very important for the exporter to understand what documents the freight forwarder is preparing and for the exporter to review and be totally comfortable with the contents of such documents. Furthermore, the documents prepared by the freight forwarder are usually prepared based on information supplied by the exporter.  If the exporter does not understand the documents or the information that is being requested and a mistake occurs, the freight forwards will claim that the mistake was due to improper information provided by the exporter.

Freight Forwarder’s Powers of Attorney:

 A freight forwarder will ordinarily provide a form contract that specifies the services it will perform and the terms and conditions of the relationship.  Among other things, the contract will contain a provision appointing the freight forwarder as an agent to prepare documentation and granting a power of attorney for that purpose. Under new regulations, if the freight forwarder will have the authority to prepare shipper’s Export Declarations that must be expressly stated in the power of attorney.) Usually, however, the freight forwarder will have a more elaborate contract which includes other specific terms of or provisions relating to, the Services which it will provide.

Shipper’s Letters of Instructions

 On each individual export transaction, the freight forwarder will want to receive instructions from the exporter on how the export is to be processed. The terms or Conditions of sale agreed between the seller and the buyer may vary from sale to sale. Consequently, in order for the freight forwarder to process the physical export of the goods and prepare the proper documentation, it is necessary for the exporter to advise the freight forwarder as to the specific agreement between the seller and buyer for that sale.  Freight forwarders offer provide standard forms containing spaces to be filled in by the exporter for the information that it needs.

Commercial Invoices

 When the exports is shipped, the exporter must prepare a commercial invoice, which is a statement to the buyer for payment. Usually English is sufficient but some countries require the seller’s invoice to be in their language.  Multiple copies are usually required, some of which are sent with the bill of lading and other transportation documents. The original is forwarded through banking channels for payment (except on open account sales, where it is sent directly to the buyer).  On letter of credit transactions, the invoice must be issued by the beneficiary of the letter of credit and addressed to the applicant for the letter of credit.  Putting the commercial invoice number on the other shipping documents helps to tie the documents together.

Bills of Lading

 Bills of lading are best understood if considered as bills of loading.  These documents are issued by transportation carriers as evidence that they have received the shipment and have agreed to transport it to the destination in accordance with their usual tariffs s (rate schedule). Separate bills of lading may be issued for the inland or domestic portion of the transportation and the ocean marine) or air transportation, or a through bill of lading covering all transportation to the destination may be issued.

The domestic portion of the route will usually be handled by the trucking company or railroad transporting the product to the port of export.  Such  transportation companies have the own forms of bills of lading and, again, commercial stationers make available forms that can be utilized by exporters, which generally say that the exporter agrees to all of the specific terms or conditions of transport normally  contained in the carrier’s usual bill of lading and tariff. The inland bill of lading should be prepared in accordance with the freight forwarders or transportation carrier’s instructions.

The ocean transportation will be covered by a marine bill of lading prepared by the exporter or freight forwarder and issued by the steamship company. Information in bills of lading (except apparent condition at the time of loading) such as marks, numbers, quantity, weight, and hazardous nature is based on information provided to the carrier by the shipper, and the shipper warrants its accuracy.  Making, altering, negotiating, or transferring a bill of lading with intent to defraud is a criminal offense.  If the transportation is by air, the airline carrier will prepare and issue an air waybill. A freight consolidator will issue house air waybills which are not binding on the carrier buy are given to each shipper to evidence inclusion of its shipment as part of the consolidated shipment. In such cases the freight consolidator becomes the “shipper” on the master bill of lading.

Dock and Warehouse Receipts

 Upon completion of the inland transportation to the port of export, the inland carrier may deliver the goods to a warehouse company or to a warehouse operated by the steamship company as arranged by the freight forwarder.  A dock receipt is often prepared by the freight forwarder on the steamship company’s form and is signed by the warehouseman or agent of the steamship company upon receipt of the goods as evidence of the receipt.  The inland carrier then provides a signed copy of the dock receipt to the freight forwarder as evidence that it has completed the delivery.

Consular Invoices

 In addition to a commercial invoice, some countries, including Panama, Bolivia, Haiti, the Dominican Republic, and Honduras, also require that a consular invoice be prepared.  A consular invoice is usually prepared from the information in the commercial invoice, but it must be signed by a representative of the country of destination stationed at that country’s embassy or consulate located in the United States nearest the exporter. One reasons for requiring such invoices is that the country of destination may deduct certain charges from the price of the goods in order to determine the value for customs duties. If the commercial invoice does not contain all of the information necessary, the foreign customs service would be unable to complete the duty assessment. The consular invoice list the specific items about which that country requires information. The consular charges a fee for this service.

Certificates of Origin

Some countries require that goods shipped to the country be accompanied by a certificate of    origin designating the place of manufacture or production of the goods.  This is signed by the exporter, and usually, a local chamber of commerce that is used to performing this service (again, for a feed) certifies to the best of its knowledge that the products are products of the country specified the exporter. The exporter may exports to or imports from Canada or Mexico. In general, in order to be eligible for the duty-free or reduced duty rates under NAFTA, all items imported from outside of North America must have undergone the “tariff shift”   specified in Annex 401 during the manufacturing process for that product.

Certificates of Free Sale

 Sometimes an importer will request that an exporter provide a certificate of free Sale.  Loosely speaking, this a certification that a product being purchased by the  importer complies with any U.S. government regulations for marketing the product  And may be freely sold within the United States. Sometimes, depending upon the Type of product involved, the importer will be able to accept a self-certification by the Exporter.  Frequently, however, the importer seeks the certificate of free sale because the importer’s own government requires it.

For example, these request are common With regard to food, beverages, pharmaceuticals, and medical devices.  The foreign Government may or may not require the importer to conduct its own testing of the Products for safety but May, either as a primary source or as backup for its own testing, seek confirmation that the products are in compliance with the U.S. Food, Drug and Cosmetics Act. Delivery Instructions and Delivery Orders The Delivery Instructions form is usually issued by the freight forwarding company to the inland transportation carrier (the trucking or rail company), indicating to the inland carrier which pier or steamship company has been selected for the ocean transportation and giving specific instructions to the inland carrier as to where to deliver the goods at the port of export.

This must be distinguished from the Delivery Order, which is a document used to instruct the customs broker at the foreign port of destination what to do with the  goods , in particular, the method of foreign inland transportation to the  buyer’s place of business.

Shipper’s Declarations for Dangerous Goods

 Under the U.S. Hazardous Materials Transportation Act, the international Air Transport Association Dangerous Goods Regulations, and the International Maritime Dangerous Goods Code, exporters are required to provide special declarations or notice to the inland and ocean transportation companies when the goods are hazardous. This includes explosives, radioactive materials, etiological agents, flammable liquids or solids, combustible liquids or solids, poisons, oxidizing or corrosive materials, and compressed gases. These include aerosols, dry ice, batteries, cotton, anti-freeze, cigarette lighters, motor vehicles, diesel fuel, disinfectants, cleaning liquids, fire extinguishers, Pesticides, animal or vegetable fabrics or fibres, matches, paints, and may other products.  The shipper must certify on the invoice that the goods are properly Classed, described, packaged, marked and labelled, and are in proper condition for Transportation in accordance with the regulations of the Department of Transportation Precursor and Essential Chemical Exports Those who export (or import) “precursor” chemicals and “essential “chemicals that can be used to manufacture illegal drugs are required to file Drug Enforcement Administration (DEA) Form 486 In some case,. This form must be filed fifteen days in advance of exportation (or importation).

Animal, Plant, and Food Export Certificates

  The U.S. Department of Agriculture is supportive of companies that want to export Livestock, animal product s, and plants and plant products. Often, the destination Country will have specific requirements in order to permit import to that country, but sometimes the foreign country will accept or require inspections performed and Certificates issued in the United States. In general, the U.S. Department of Agriculture Offers inspection services and a variety of certificates to enable exporters to satisfy Foreign Government requirements.

Drafts for Payment

 If payment for the sale is going to be made under a letter of credit or by documentary  Collection, such as documents against payment ( “DP” or sight draft ) or documents against acceptance (“DA or time draft ), the exporter will draw a draft on the buyer’s  bank in a little  of credit transaction or the l buyer in a documentary collection  transaction payable to itself ( sometimes it will be payable to the seller’s bank on a  confirmed letter or credit ) in the amount of the sale. This draft will be sent to the seller’s bank along with the instructions for collection, or sometimes the seller will sent it directly to the buyer’s bank. If the payment agreement between the seller and buyer is at sight, the buyer will pay the draft when it is received, or if issued under a letter of credit, the buyer’s bank will pay the draft when it is received.  If the agreement between the seller and the buyer is that the buyer will have some grace period before making payment, the amount of the delay, called the usance, will be written on the draft (time draft), and the buyer will usually be responsible for  payment of interest to the seller during the usance period unless the parties agree otherwise. The time period may also be specified as some period after a fixed date, such as ninety days after the bill of lading or commercial invoice date, or payment simply may be due on a fixed date.

Freight Forwarder’s Invoices

The freight forwarder will issue a bill to the exporter for its services. Sometimes. The forwarder will include certain services in its standard quotation while other services. Will be add-ons. It is important to make clear at the outset of the transaction which services will be performed by the exporter, the freight forwarder, and other, Such as the bank.

Shipper’s Export Declarations

The Shipper’s Export Declaration (SED) is important because it is the one by one of all of the export documents that is filled with and U.S. Governmental agency. The SED is given to the exporting steamship carrier or air carrier and is filed by them with the U.S. Customs Service prior to clearing the port. This document may be prepared by the exporter, or it may be prepared by the exporter’s agent, the freight forwarder, and the exporter may not see it.  Nevertheless, the SED form specifically states that any false statements in the form (which is interpreted to include accidentally false statements as well as intentionally false statements) will subject the exporter to various civil and criminal penalties, including a $ 10,000 fine and up to five year’s imprisonment.

Letters of credit

 When the buyer has agreed to provide a letter or credit as part of the payment terms, the buyer will apply to its local bank in its home country and a letter of credit will be issued. The seller should send instructions to the buyer before the letter of credit is opened, advising the seller as to the terms and conditions it desires.  The seller should always specify that the letter of credit must be irrevocable.  The bank in the buyer’s country is called the issuing bank. The buyer’s bank will contact a correspondent bank near the seller in the United States, and the U.S. bank will send a notice or advice to the exporter that the letter of credit has been opened.  If the letter of credit is a confirmed letter of credit, the U.S bank is called the confirming bank; otherwise, it is called the advising bank. The advice will specify the exact documents that the exporter must provide to the bank in order to receive payment.  Since the foreign and U.S. banks are acting as agent and subagent, respectively, for the buyer, the U.S. bank will refuse to pay unless the exact documents specified in the letter of credit are provided. The banks never see the actual shipment or inspect the goods; therefore, they are extremely meticulous about not releasing payment unless the documents required have been provided. The issuing bank and advising bank each have up to seven banking days to review the documents presented before making payment when the exporter receives the advice of the opening of a letter of credit, the exporter should review in detail the exact documents required in order to be paid under the letter of credit.

Introduction to Letters of Credit

Letters of credit are a payment mechanism, particularly used in international trade.  The Seller gets paid, not after the Buyer has inspected the goods and approved them,  but when the Seller present certain document ( typically a bill of lading evidencing  shipment of the goods, an insurance policy for the goods, commercial invoice, etc.) to  his bank. The bank does not verify that the documents presented are true, but only whether they “on their face” appear to be consistent with each other and comply with the terms of the credit. After examination the bank will pay the Seller (or in LC terms the beneficiary of the letter of credit).

Example:

  • Buyer and Seller sign a purchase contract that stipulates payment by letter of credit. It is good practice to agree already in the purchase contract which documents the Seller / Beneficiary has to present.
  • The Buyer goes to his bank (so called issuing bank ) opening the credit to the benefit of the Seller, in particular the Buyer tells his bank which documents the  Beneficiary has to present, where and how, and the amount of the credit and details of payment ( by sight, deferred sight payment, against acceptance or negotiation of drafts).
  • The issuing Bank, which is normally located in a foreign country, advises the Beneficiary through a correspondence bank located in the country of the Beneficiary of the credit.
  • The Buyer ships the goods and presents the necessary documents to his local bank which pays him after examining them.  The obligation of the bank is independent of the rights of the parties under the purchase/service contract.  This means that absent fraud, the bank has to pay when conforming documents are presented, even though the goods are not of the contractually agreed quality or quantity.

The Seller can strengthen his position by requesting a “confirmed“letter of credit.  The confirmation of a bank in the Seller’s country means that the payment obligation of the confirming bank is independent of the issuing bank. If the issuing bank cannot wire funds outside the country due to governmental restrictions, the confirming bank still has to pay, even though it will not be reimbursed by the issuing bank.

The Seller thus can avoid currency transfer restrictions which are sometimes found in   developing countries. A standby letter of credit is basically a bank guarantee. Previously US banks were not allowed to issue guarantees and circumvented this limitation by issuing standby letters of credit where the beneficiary basically has to present his face to get paid.  Most letters of credit, particularly in international transactions, are subject to the Uniform Customs and Practices (UCP) issued and published by the International Chamber of Commerce (ICC).

The current revision UCP 600 is publication No. 600 of the ICC and takes effect as of July 1 ,2007  Since the ICC lacks legislative authority, meaning it is not the arm of or authorized by any government but rather a trade association, the  UCP are no laws and have to be explicitly incorporated into individual transaction.  Some countries and states have enacted statutes regarding letters of credit (see e.g. Article 5 US Uniform Commercial Code). In international trade however, most parties choose to use the UCP.

The Letter of Credit

  A letter of credit is a document typically issued by a bank or financial institution ,  which authorizes the recipient of the letter ( the “customer “ of the bank ) to draw  amounts of money up to a specified total, consistent with any terms and conditions set forth in the letter.  This usually occurs where the bank’s customer seeks to assure a seller (the “beneficiary “ ) that it will receive payment for any goods it sells to the customer.

For example, the bank might extend the letter of credit conditioned upon the beneficiary’s providing documentation that the goods purchase with the line of credit have been shipped to the customer. The customer may use the letter of credit to assure the beneficiary that, if it satisfies the conditions set forth in the letter, it will be paid for any goods it sells and ships to the customer.

In simple terms, a letter of credit could be said to document a bank customer’s line of credit, and any terms associated with its use of that line of credit.  Letters of credit are most commonly used in association with long-distance and international commercial transactions.

Confirmed Letter of Credit.

A letter of credit, issued by a foreign bank, which has been verified and guaranteed by  a domestic bank in the event of default by the foreign bank or buyer.  Typically, this form of letter of credit will be sought when a domestic exporter seeks assurance of payment from a foreign importer.

Commercial Letter of Credit.

 A commercial letter of credit assures the seller that the bank will provide payment for any goods or merchandise shipped to the bank’s customer, assuming the seller provides any required documentation of the transaction and its shipment of the purchased goods.

Irrevocable Letter of Credit

  An irrevocable letter of credit includes a guarantee by the issuing bank that if all of the terms and conditions set forth in the letter are satisfied by the beneficiary, the letter of credit will be honoured.

Standby Letter of Credit.

 In the event that the bank’s customer defaults on a payment to the beneficiary, and the beneficiary documents proof of its loss consistent with any terms set forth in the letter, a standby letter of credit may be used by the beneficiary to secure payment from the issuing bank.

Import And Export Procedure To start Export Business Along With Import Export Course Of international shipping documents.

List Institutional Support For Exporters

IMPORT EXPORT

Institutional Support For Exporters

Exporters India Institutional Support,As explained in the class, number of Institutional Support for Exporters India is extending various kinds of support for export promotion.  The list along with the addresses in Maharashtra is given below.

MSME _ Development Institute, Mumbai. MINISTRY OF MSME GOVT. OF INDIA MUMBAI…in the service of small scale industries in Maharashtra

ROLE & ACTIVITIES

Small Scale Industry Sector occupies an important position in the country’s industrial economy and continues to contribute to industrial production, exports, creation of employment opportunities etc. This is a sector that has emerged victorious in the face of rising threats from large sector within the country and from multi-nationals abroad. The Micro, Small & Medium Enterprises – Development Institute, Mumbai is the field office of Development Commissioner (MSME). Ministry of MSME. Govt. of India, set up for the promotion and development of Small Scale Industries in the state in the early fifties. This institute provides support/services to the State Government as well as coordinates various activities at the state level for the promotion & development of small scale industries. This Institute, along with SISI, Nagpur and Branch Institute at Aurangabad extend their services in Maharashtra.

O/o. DC (MSME), under the Ministry of MSME is the Apex body at the national level, headed by Development commissioner, (MSME) formulates the policy governing the Micro, Small & Medium Industries Sector in the country and chalk out schemes and programmes for development of the SSI sector. MSME also monitors the implementation of policies and the activities of promotion of small scale industries with active involvement of the State Directorate of Industries, through its network of 30 Small Industries Service Institutes (SISI), in all the states.

MSME-DI, Mumbai provides various types of extension services and assistance in setting up of units, promotions and development of products and services by the MSME. The Institute has technical Officers to provide guidance in all trades i.e. Metallurgy, Mechanical, Chemical, Leather, Glass & Ceramics, Electrical, Electronics, Food Industry, Management & Economic Investigation etc.

DETAILS OF MAJOR EXENSION SERVICES PROVIDED BY THE INSTITUTE ARE GIVEN BELOW

  • Technical Consultancy
  • Industrial Management Training
  • Economic Information
  • Entrepreneurial Development Programmes, Schemes for Educated Unemployed Youth/Prime
  • Minister’s Rozgar Yojana (PMRY)
  • Technology Resource Centre Facilities
  • Ancillary Development/Sub Contract Exchange
  • Marketing Assistance
  • Modernisation/Technology Up gradation
  • Export Promotion & Marketing Assistance for rehabilitation of sick units
  • Common Facility and Training
  • Bio-Technology
  • Library Facility
  • Assistance to State Govt. Agencies
  • Technical Assistance to various Central Govt. Agencies, Incentives for Small Scale Sector

TECHNICAL CONSULTYANCY SERVICES.

  • Technical guidance
  • Identification and preparation of Project profiles/reports
  • Selection of Equipment, Machinery & Raw Materials.
  • Technical Up-gradation /Quality control.
  • Technical Seminar/ Workshop/ Clinic.
  • To prepare technical literature/ papers etc.

MANTERIAL CONSULTANCY SERVICES.

  • Conduct various Industrial Management Course e.g. Personnel, Finance, Marketing, Taxation, Export etc.
  • Improvement of Quality, Productivity of Labour etc.
  • Techno-Economical and Managerial, Appraisal reports to Banks/Financial Institutions.
  • Technical Training Course on product development etc.
  • Short-term / Tailor-made Technical Courses.

ECONOMIC INVESTIGATION SERVICES.

  • Industrial Potential Survey / Market Surveys.
  • Feasibility reports / State Industrial Profile.
  • Sample Survey / Collection of Statistics.
  • SSI Census.
  • Review Report / Production Index
  • Assistance and Rehabilitation of sick Units.
  • Advice/ guidance on policy issues.
  • Guidance on facilities available with Banks, Financial Institutions etc.

ENTREPRENEURIAL DEVELOPMENT PROGRAMMES (EPs)

  • General One Month EDP Course.
  • Product and process EDP Programmes.
  • EDP for Women Entrepreneurs.
  • Product / Process Demonstrations.
  • To assist various institutions and Agencies for EDP.

PRIME MINISTER’S ROZGAR YOUJANA

  • To provide information about the different Schemes.
  • To help beneficiaries in identifying suitable projects.
  • To collect application forms in the district of Mumbai & place them before Task Force Committee.
  • To Co-ordinate PMRY activities with State Government.

COUNSELLING, RE-TRAINING & REDEPLOYMENT OF VRS OPTEES OF CPSUs.

  • Nodal Agency. Identified by Department of Public Enterprises for implementation of the above programme.
  • Conducts sensitization programmes & Awareness Campaigns for motivation VRS Optees & VRS released employees to join for the programmes.
  • Conduct training programme of 20/40 days duration, useful for self-employment of VRS employees.

TECHNOLOGY RESOURSE CENTRE.

A Technology Resource Centre has been functioning in the Institute since Sept/ OCT. 2001.  It serves as one stop Technology Sourcing through highly computerized connective environment linkages. It serves the need of existing & Prospective entrepreneurs at minimal & competitive costs.  Technical divisions of the Institute also source the technologies for providing to short and long training courses   held by the Institutes in the fields of Chemical, IMT Mechanical, etc.  A data base related to SS is under creation.

ANCILLARY DEVELOPMENT PROGRAMMES.

  • Identifications of Ancillary items for large/ small scale industries.
  • Interaction with public / private sector undertakings.
  • Preparation of Ancillary report / Directory.
  • Organising State Level Ancillary Development Programme-Cum-Exhibition or SMEs.
  • Both Global & Joint Venture out Sourcing.

MARKETING ASSISTRANCE AND SRVICES.

  • Provide Market information.
  • Assist to prepare market feasibility report.
  • Indirect market support through Sub-Contract Exchange.
  • Marketing assistance for Govt. / Semi-Govt. programme through single point NSIC Registration.
  • Marketing Buyer-Sellers-Meet-cum-Exhibition.

EXPORT PROMOTION SERVICES.

  • Export Market information.
  • Export process and procedures information.
  • Export Management training.
  • Export Packaging training.
  • Seminar / Workshop on Export related procedures.
  • Arrange and forward exhibits to foreign trade fairs…
  • Preparation of Export directory and reports.
  • Seminar or “Bar Coding”
  • WTO Sensitization Seminars & Activities.
  • Seminars on IPR/Investigation of Anti-Dumping etc.

MODERNISATION / TECHNOLOTY UPGRADATION SERVICES.

  • Undertaking in-plant studies.
  • Conduct cluster studies.
  • Programmes on Technology up-gradation / quality up-gradation & ISO-9000/Energy Conservation.
  • Conducting Awareness Programme/ Seminar/ Workshop on Pollution Control & ODS Phase Out.
  • Undertaking industry studies.
  • Co-ordination of Modernisation Activities.

COMMON FACILITY SERVICES.

  • Workshop facilities for undertaking jobs, jigs and fixtures, pressed tools, complicated jobs etc.
  • Industrial Design.
  • Machines Shop Practices for six month.
  • Short term courses on CNC Wire-cut machine and CNC Milling & Boring Machine.

LIBRARY FACILITY

  • The Institute has enriched Library containing different types of Technical Books. Magazines, Journals & reports relating to Industries.

BIOTECHNOLOGY CELL.

The Biotechnology Cell set up in this Institute performs the activities such as:

  • Dissemination of Techno Commercial Information on Bio-Tech Projects.
  • Organise Workshop, Seminars in Biotechnology.
  • Technical Counselling for modernisation of existing Biotech SMEs.

TOY DESIGN CENTRE.

The Centre caters to the design & of the needs of the Toy Industries especially in the following areas:

  • It centres a Toy Design Cell with the latest Software’s.
  • Assist existing and new small scale toy manufacturers in designing new toys.
  • Counselling for Mould making.
  • Organizes Seminars, Workshops etc. for capacity building of S.S. Toys Industries.

CAD/ CAM CENTRE.

In Association with Indo German Tools Room Aurangabad (an ISO 9000 company). This Institute has set up CAD/CAM Training Centre.  The training programmes in the following software’s are offered to the Engineering Graduates, Diploma Holders and working Professionals, in engineering disciplines.

CNC Programming & Machining, CATIA, UNIGRAPHIC (DESIGN), SOLID EDGE, MEDT, INVENTOR, INTERGRATED COURSE IN CAD /CAM.

ASSISTANCE TO STATE GOVT. AGENCIES.

Provide all sorts of technical and other assistance to State Agencies like DICs, State Directorate of Industries, Corporation and various other industrial developmental agencies in the State.

TECHNICAL ASSISTANCE TO VARIOUS CENTRAL GOVT. AGENCES LIKE.

  • NSIC, BIS CSIR. ETC.
  • All sorts of assistance and support to various NGOs. Associations and Institutions involved in the promotion and development of industries.

 

CONTACT DETAILS OF MSME-MUMBAI

 

MSME

 

MSME- Development Institute

Ministry of MSME, Govt. of India,

Kurla Andheri Road, Sakinana

Mumbai-400072

Tel. : 28576090/3091 /7166

Fax : 28578092

Email : smalllind@vsnl.com

Website : www.sisimumbai.com

 

Khadi & Village Industries Commission (KVIC)

OBJECTIVES AND FUNCTIONS

OBJDECTIVES;   The broad objectives that the KVIC has set before it are…

  • The social objective of providing employment.
  • The economic objectr5ive of producing saleable articles.
  • The wider objective of creating self-reliance amongst the poor and building up of a strong rural community spirit.

FUNCTIONS: Some of the major functions of KVC

  • The KVIC is charged with the planning. Promotion, organisation and implementation of programs for the development of khadi and other village industries in the rural areas in coordination with other agencies engaged in rural development wherever necessary.
  • Its functions also comprise building up of a reserve of raw materials and implements for supply to producers. Creation of common service facilities for processing of raw materials as semi-finished goods and provisions of facilities for marketing of KVI product apart the organization of training of artisans engaged in these industries and encouragement of co-operative efforts amongst them. The promote the sale and marketing of Khadi and / or products of village industries or handicrafts, the KVIC may
  • Forge linkages with established marketing agencies wherever feasible and necessary.
  • The KVIC is also charged with the responsibility of encouraging and promoting research in the production techniques and equipment employed in the Khadi and village Industries sector and providing facilities for the study for the problems relating to it, including the use of non-conventional energy and electric power with a view to increasing productivity, eliminating drudgery and otherwise enhancing their competitive capacity and arranging for dissemination of salient results obtained from such research.
  • Further, the KVIC is entrusted with the task of providing financial assistance to institutions and individuals for development and operation of Khadi and village industries and guiding them through supply of designs. Prototypes and other technical information.
  • In implementing KVIC activities, the KVIC may take such steps as to ensure genuineness of the products and to set standards of quality and ensure that the products of Khadi and village industries do conform the standards.
  • The KVIC may also undertake directly or through other agencies studies concerning the problems of Khadi and /or village industries besides research or establishing pilot projects for the development of Khadi and village industries.
  • The KVIC is authorized to establish and maintain separate organisations for the purpose of carrying out any or all of the above matters besides carrying out any other matters incidental to its activities.

 

Khadi & Village Industries Commission, Royal Insurance Building, 4th floor 14 Jamshedji Tata Road,

City : Mumbai ● Pin code: 400 020

Phone 22822113
Email somkniac@bom3.vsnl.net.in
Fax
Telefax 2281 7449

NSIC

National Small Industries Corporation Ltd. (NSIC). On ISO 9001 certified company. Since its establishment in 1955, has been working to fulfil its mission of promoting, aiding and fostering the growth of smalls ale industries and industry related small scale services / business enterprises in the country. Over a period of five decades of transition. Growth and development, NSIC has proved its strength within the country and abroad by promoting modernization, up gradation of technology, quality consciousness.  Strengthening linkages with large and medium enterprises and enhancing exports projects and products from small industries.

NSIC operates through 6 Zonal Offices. 26 Branch Offices. 15 Branch Offices. 15 Sub Offices, 5 Technical Services Centres, 3 Extension Centres and 2 software Technology Parks supported by a team of over 5000 professionals spread across the country.  The manage operations in Gulf and African countries NSIC operates from its offices in Dubai and Johannesburg.

NSIC carries forward its mission to assist small enterprises with a set of specially tailored schemes designed to put them in a competitive and advantageous position. The schemes comprises of facilitating marketing support, credit support, technology support and other support services.

  • Marketing
  • Consortia and Tender Marketing.
  • Single Point Registration for Government Purchase.
  • Exhibitions and Technology Fairs.
  • Buyer-Seller meets.
  • Export of Products and Projects.
  • Credit Support
  • Equipment Financing.
  • Financing for procurement of Raw Material (Short term)
  • Financing for Marketing Activities (Short term)
  • Finance through syndication with Banks.
  • Performance and Credit Rating Scheme for small industries.
  • Infomediary Services.
  • Mentoring and Advisory Services.
  • Software Technology Parks.
  • Science and Technology Part /Technology Business Incubators.
  • International Cooperation.
  • International consultancy services.

NSIC

Prestige Chambers, Kalyan Street.

Masjid (East)

Mumbai-40009

Textile Committee

 The Textiles Committee’s main objective is to ensure the quality of textiles and textile machinery both for internal consumption and export purposes. The Textiles Committee. As corollary to its main objective of ensuring the quality of textiles and textiles machinery has been entrusted with the following functions, under Section 4 of the Act:

  1. To undertake, assist and encourage, scientific, technological and economic research.
  2. To establish standard specifications for textiles, textile machinery and the packingMaterials.
  3. To establish laboratories for the testing of textiles and textile machinery.
  4. To provide training in the techniques of quality control.
  5. To provide for the inspection and examination of textiles and textile machinery
  6. To promote export of textiles.
  7. To collect statistics and to advise the Central Government on all matters relating to textiles and textile machinery.

Textiles Committee

Balu Road, Off. Veer Savarkar Marg.

Prabahadevi Chowk, Prabhadevi,

Mumbai- 400 025

Tel: 91-22-66527507, 66527500 (Board)

Fax: 91-22-66527509

Textiles Committee,

Ministry of Textiles, Govt. of India

162/11, Railway Lines

Solapur-413001

Maharashtra, India.

Indian Trade Promotion Organisation (ITPO)

India Trade Promotion Organisation (ITPO) is the nodal agency of the Government of India for promoting the country’s external trade. ITPO, during its existence of nearly three decades, in the form of trade Fair Authority of India and Trade Development Authority, has played a proactive role in catalysing trade, investment and technology transfer process. It promotional tools include organizing of fairs and exhibitions in India and abroad, Buyer-Seller Meets, Contact Promotion Programmes. Product Promotion Programmes and Promotion through Overseas Department stores, Market surveys and information Dissemination.

ITPO has an extensive infrastructure as well as marketing and information facilities that are availed by both exporters India and importers.  ITPO’s overseas offices assist buyers seeking information relating to sourcing products from India. ITPO’s overseas offices at New York. Frankfurt, Tokyo “Moscow and sao Paulo are pursuing opportunities for enhancement of India’s trade and investment.

Indian Trade Promotion Organisation (ITPO)

Pragati  Bhawan, Pragati Maidan

New Delhi- 110 001

New Delhi-110 001

E-mail: infor@itpo-online.com,itpo@vsnl.com.

Mumbai Office

Jhansi Castle,

7, Cooperage Road

Mumbai-400009

Tel.: 022-228221041

Fax: 022-22044922

Email: itpoby@vnsl.net

Directorate of Industries

The Directorate of Industries is an executive arm of the Industries Department and is engaged in implementation of Govt’s policies for all round development of industries in the State by seeking coordination amongst the State level promotional corporations and other Departments/ agencies of the Govt. relating to industries.

Its main functions are:

  1. To implement Industrial Policy 2001 / 2006 of the Government.
  2. Suggest Policy measure to the Government for effecting healthy and all round industrial development in the State in view of challenges and opportunities posed to the industry in the prevailing economic scenario.
  3. Assist Government in formulation of various polices viz. Industrial Policy, SEZ Polity, It policy. It policy, BT Policy, Package Scheme of Incentives, etc.
  4. Implement various promotional schemes.
  5. Resolving the operational problems of industry by inter departmental coordination.

Address

Directorate of Industries.

Government of Maharashtra

2nd Floor, New Administrative Bldg.,

Opposite Mantralaya.

Mumbai-400 032

Sr. No.

Office /Depart./ Organisation

Office in Maharashtra

 

1 Office of the Development  Commissioner (MSME) 7 th Floor, Nirman  Bhavan New Delhi 110011 Director, Small Industries Service Institute. Govt. of India. Ministry of MSME, Sakinaka, Mumbai 400072

Tel. 022-28576090/3091

Website www.sisimumbai.com.

Email.smallind@vsnl.com.

2 Director General Foreign Trade

Udyog Bhavan, New Delhi 110011

1)    The Joint Director General Foreign Trade, Central Govt. Offices New Bldg. New Marine Lines, Churchgate Mumbai 400020

Tel. 022-22016421

 

2)    Jt. DGFT.

PMT Commercial Complex.

Swargate, Pune-411037

020-244415747

 

3 National Small Industries Corporation NSIC Ltd., Okhala, New Delhi NSIC NSIC Prestige Chambers, Kalyan Street, Masjid (East) Mumbai 40009

 

4 State Directorate of Industries Development Commissioner (Industries)  Govt. of Maharashtra  2 nd Floor, New Administrative Bldg. Opp. Mantralaya  Mumbai 400032 Or

Office of General Manager District Industries Centre in each District.

 

5 Khadi and Village Industries Commission (KVIC) KVIC Vile Parle, Mumbai 400056
6 Federation of Indian Export Organisations (EIEO) Federation of Indian Export Organisation (EIEO)

World Trade Centre No. 1. 11 th floor Cuffe Parade, Mumbai 400005

022-22185093

 

7 Indian Institute of Foreign Trade (IIFT)  B-21,Kutub Institutional Area Mehruli Road , New Delhi 110016
8 Indian Institute of Packaging (IIP) Indian Institute of Packaging (IIP)

E-2, MIDC, Marol, Andheri (East)

Mumbai 400093

 

9 World Trade Institute WTI, World Trade Centre No.1

31 st Floor, Cuffe Parade, Mumbai 400005

10 Export Import Bank of India (EXIM Bank) Export Import Bank of India (EXIM Bank )

21 st floor , world centre No.1 Cuffe Parade, Mumbai 400005

 

11 Textile Committee  Textile Committee,

P.Blu Road , Off, Veer Savarkar Marg.

Prabahadevi Chowk,Prabhadevi,

Mumbai-400 025

Tel: 91-22-66527507 , 66527500 (Board)

Fax : 91-22-66527509

E-Mail : Secy@giasbm01.vsnl.net.in

Textiles Committee3,

Ministry of Textiles ,Govt. of India

162/11, Railway Lines

Salapur-413001

Maharashtra, India

12 Export Inspection Agency Export Inspection Agency

Opera House, Mumbai 400 007

13 Bureau of Indian Standard (BIS) Bureau of Indian Standard (BIS)

Manakalya, MNIDC, Andhere.

Mumbai 400 093

14 A few  industry Associations A Few Industries Association –( For Certificate of Origin)

1)    All India Manufacturer’s Organisation. 4 the Floor, Jeevan  Sahakar, Sir P.M.Rd., Fort Mumbai-1

2)    Chamber of Small Industry Associations, TSSIA House, Plot No: P-26, Road 16/t, Wagle Industrial Estate, Thane.

3)     Thane Small Scale Industries Association, TSSIA House, Plot No: P-26, Road 16/t, Wagle Industrial Estate, Thane.

4)     Maharashtra Chamber of Commerce & Industry , Oricon House, 6 th Flklor, 12 K. Dubhash  Marg, Fort Mumbai-1

Indian Agricultural Exports Imports

Common Steps involved in starting export import business in India.

What is Export in exporters India?

Indian Agricultural Exports Imports,As per Section 2(e) of Foreign Trade (Development & Regulation) Act. 1992, the term ‘export’ is defined to mean ‘taking out of India any goods by land, sea or air’.

As such, the goods must leave India, or cross the customs frontiers of India to a foreign destination, for being reckoned as export.

However, certain supplies of goods by main/sub-contractors to specified persons (who ultimately export such goods in the same form or after further processing) are reckoned at par with exports and thus called  popularly as ‘deemed  exports’.

Such supplies are specified in chapter 8 of the Foreign Trade Policy.

Common Steps involved in starting export import business in India.

  • Setting up of a most suitable type of business organizations.
  • Obtaining PAN from Income Tax Authorities, Securing Importer-Exporter Code No. from the Regional Licensing Authority, and Registration-cum-Membership Certificate from the concerned Export Promotion Councils, and Registration with the concerned VAT/Sales Tax Authorities etc. Obtaining registration as small scale industrial unit, medium or large scale unit or as a service provider from the concerned authorities.
  • Doing Export Business Correspondence.
  • Sending/Exporting samples and exhibits.
  • Appointing overseas agents.
  • Negotiating with prospective Buyers and entering into export Contracts.
  • Understanding new Foreign Trade Policy and Procedures.
  • Obtaining Credit Limit for the Buyer/Buyer’s Country from E.C.G.C.
  • Obtaining Finance for Export.
  • Booking Forward Exchange Contracts for Avoiding Loss from Adverse Exchange Rate
  • Ensuring Compliance with Quality Control and Pre-shipment Inspection of Goods.
  • Labelling, Packaging, and Marketing Export Consignments.
  • Obtaining Excise Clearance.
  • Arranging Marine Insurance of the Goods.
  • Complying with the Exchange Control Regulations regarding Declaration of Goods.
  • Preparing /Obtaining Export Documents.
  • Shipping and Customs clearance of the Goods and Indian Customs EDI System.
  • Tendering the Documents to the Bank.
  • Understanding Foreign Exchange Regulations and Facilities.
  • Obtaining various Facilities under the new Foreign trade Policy 2004-09
  • Obtaining export incentives under the Duty Drawback Scheme, Natural Rubber Subsidy Scheme, Marketing Development Assistance etc.
  • Reimbursement of Central Sales Tax.
  • Availing Tax Exemptions /Deductions under the Income Tax Act and sale Tax Laws.

Starting export import business in India.

  • Choosing appropriate mode of operations.

You can choose any of the following modes of operations:

  1. Merchant Exporter i.e. buying the goods from the market or from a manufacturer and then selling them to foreign buyers.
  2. Manufacturer Exporter i.e. manufacturing the goods yourself for export.
  • Sales Agents/ Commission Agent/Indenting Agent i.e. acting on behalf of the seller and charging commissions.
  1. Buying Agent i.e. acting on behalf of the buyer and charging commission.
  2. Service provider i.e. providing service from India to another country.
  • Naming the export import business in India.

Whatever the form of business organization has been finally decided, naming the business is an essential task for every exporter.

The name and style should be soft. Attractive, short and meaningful. Simple and attractive name indicating the nature of business is ideal.

The office should be located preferably in a commercial complex, in clean and workable surroundings. The letterhead should be simple and super providing information concerning Registered Office, Head Office, and Corporate Office. Email address, telephone number, fax, mobile number, bankers name and address etc.

Pick up a beautiful trade name and logo which reinforce your organisation’s name and image.  Open a current account with a reputed Bank in the name of the Organisation in whose name you intend to export.

It is advisable to open an account with the Bank that is authorized to deal in foreign exchange.

  • Selecting the Product to exporters India.

Carefully select the product to be exported.  For proper selection of the product, study the trends of export of different items from India.

The selected product must be in demand in the countries where it is to be exported.  It should be possible to procure or manufacture the selected product at most economical cost so that it can be competitively priced.

If should also be available in sufficient quantity acceptable quality standards; attractive packaging and it should be possible to supply it repeatedly and regularly.

Besides, while selecting the product. If has to be ensured that you are conversant with Government policy and regulations in respect of the products selected for export.

You should also know import regulations in respect of such commodities by the importing countries. If would be preferable if you have previous knowledge and experience of commodities selected by you for export.

A non-technical person should avoid dealing in high-tech products.  Another important feature to be kept in mind is that product should be adapted as per market requirement.

  • Making effective Business Correspondence import export companies.

Business communication is an interaction which clarifies issues. Resolves conflicts  and misunderstanding and helps in decision making.

Messages also reflect many angles and levels: factual, emotional and cultural. With the information technology modes and paperless communication being used.

Conveyance of information amongst the interacting parties will speed up and these will cut down on the business process costs and times. Technologically advanced media are required to be used in business communication.

For creating a very favorable and excellent impression, you must use a decent  letterhead on airmail paper and a good envelope, nicely printed, giving full particulars of your firm’s name, postal address, telephone number, mobile number, fax number and email address etc.

Your language should be polished, polite, soft, brief and to the point, giving a very clear picture of the subject to be put before the customer.

Letters should be typed/computer typed set, preferably in the language of the importing country.  Also make sure that the full and correct address is written and the envelope is duly stamped.

Selecting the Overseas Market the help of import export data.

Overseas markets are identified as traditional, potential and new.  Target markets should be selected after careful consideration of various factors like political relations of India with the importing country, embargo, scope of exporter’s selected product, demand stability.

Preferential treatment to products from developing counties, market penetration by competitive countries and product, distance of potential market, transport problems, language problems.

Tariff and non-tariff barriers, distribution infrastructure, six of demand in the market, expected life span of market and product requirements, sales and distribution channels.

For this purpose you should collect adequate market information before selecting one or more target markets.

The information can be collected from various sources like Export Promotion Councils (Epics) /Commodity Boards.  Federation of Indian Export Organisation (FIEO).  Indian Institute of Foreign Trade (IIFT).  Indian Trade Promotion Organisation (ITPO).

Indian Embassies and High Commissions abroad, Foreign Embassies and High Commissions in India. Import Promotion Institutions Abroad, Overseas Chambers of Commerce & Industries.

Various Directories, and Journals, market Survey Reports etc.

  • Selecting prospective overseas buyers and importers in USA.

You can collect address of the prospective buyers of the commodity from the following sources:

  • Enquiries from friends and relatives or other acquaintances residing in foreign countries.
  • Visiting /participating in International Trade Fairs and Exhibition s in India and abroad.
  • Contact with the Export Promotion Councils, Commodity Board and other Govt. Agencies.
  • Consulting International Yellow Pages. (A publication from New York) by Dun & Bradstreet, USA or other Yellow Pages of different Counties like Japan, Dubai etc.)
  • Collecting address from various Private Indian Publications.
  • Collecting information from international Trade Directories/Journals/Periodicals available in the libraries of Directorate General of Commercial Intelligence and Statistics, IIFT, EPCs, ITPO etc.
  • Browsing the Internet.
  • Making contacts with Trade Representatives of Overseas Governments in India and India Trade and Other Representatives/International Trade Development Authorities abroad).
  • Reading biweekly, fortnightly. Monthly bulletins such as Indian Trade Journal, Export Service Bulletin, Bulletins and Magazines issued and published by Federation of Exporters Organisation, ITPO, EPCs, Commodity Boards and Other allied agencies.
  • Visiting Embassies, Consulates etc. of other countries and taking note of addresses of importers for products proposed to be exported.
  • Advertising in newspapers having overseas editions and other foreign newspapers   and magazines etc.
  • Consulting ITPO. IIFT etc.
  • Contacting authorized dealers in foreign exchange with whom exporter is maintaining bank account.
  • Visiting popular Websites by making use of Internet Services.
  • Creating a detailed Website about your Organisation.

How to contact Overseas Importers in USA?

  • -By corresponding and sending and sending brochure and product literature to prospective overseas buyers.
  • -By undertaking trips to foreign markets and establishing personal rapport with overseas buyers. The number of trips will depend on you budget and resources. But it is essential for long term success in international marketing to establish personal rapport.  Foreign trip will provide first-hand information regarding the market.  Overseas customers, their requirement, taste. Preference and better out communication about the merits of exporter’s products.
  • -MSME units can take the help of SIDO’s Scheme- SSI MDA.
  • -Participation in buyers-sellers meet and meeting the members of foreign delegation invited by Export Promotion Council Concerned.
  • -Participation in International Trade Fairs, Exhibitions, Seminars and Buyer’s Sellers meet. Trade Fairs held in India as well as important world Centres provide contacts with a large number of buyers if an exporter has good quality products with reasonable price. These fairs are expensive, no doubt but such expenses are covered by future business.
  • -Advertisement and publicity in overseas reputed newspapers and magazines as well as in popular websites which people usually visit. Facilities of free publicity can be availed from Import Development Centres.
  • -Creating Websites and making it popular on international arena.
  1. Selecting Channels of Distribution from exporters India.

The following channels of distribution are generally utilized while exporting to overseas

Markets:

  • Exports through Export Consortia.
  • Export through Canalizing Agencies.
  • Export through Other Established Merchant Exporters or Export Houses. Or Trading Houses.
  • Direct Exports.
  • Export through Overseas Sales Agencies.
  • Exports through e-Commerce which is in developmental stage in India.
  • Negotiating with Prospective Overseas Buyers and importers in USA.

Whatever the channels or distribution for exporting to the overseas countries is proposed to be Utilized, it is essential that the exporters should possess necessary skill for negotiating with the overseas channels of distribution. The ability to negotiate effectively is needed for discussion with importers or trade agents.

While conducting business negotiations, the prospective exporter should avoid conflict, controversy and criticism vies-a-vies the other party.

During conversation the attitude should be to communicate effectively. There should be eight ‘Cs’ i.e. coherence. Creativity, compromise. Concessions. Commonality. Consensus.  Commitment and compensation in business negotiations.

The general aspect to be kept in mind by you is about pricing.  The buyer’s contention is that prices are too high.  It should be noted that though the price is only one of the many considerations which are discussed during business negotiations, if influences the entire negotiating process.

Since this is the most sensitive issue in business negotiations, it should be fully postponed until all the other issues have been discussed and mutually agreed upon.

As far as the price is concerned, you should try to determine the buyer’s real interest in the product from the outset, only then a suitable counter proposal should be presented.

It should also be remembered that the buyer may request modifications in presentation of the product. You should show the willingness to meet such request, if possible, provided that it will result in profitable export business.

Price being the most important sales tool, it has to be properly developed and presented. Therefore, in order to create a favourable impression, minimize costly errors and generate repeated business.

The following points should be kept in mind while preparing the price list:

  1. Submit a computer printed list, printed on a regular bond paper and laid out simply and clearly (with at least an inch between column and between groupings.)
  2. Prominently, indicate the name of your company, its complete address, telephone number, mobile number and fax numbers and email address, including the country and city codes.
  3. Fully describe the items being quoted.
  4. Group the items logically (i.e. the fabrics together, all the made ups together etc.)
  5. Specify whether shipped by sea or by air, f.o.b.,or c.i.f., and to which port.
  6. Quote exact amount and not rounded off figures.
  7. Mention the dates up to which the prices quoted will remain valid.
  8. Where there is an internal reference number which must be quoted try to keep it Mention as short as possible (the buyer has no interest in the detail and the more complex it is, the greater the risk of errors. As regards the factors determining your price, please refer to the papa on ‘Export Pricing and Costing ‘further in the chapter.
  9. Clearly mention payment terms required by you.
  10. Preshipment inspection should be well defined.

One main point regarding export pricing is that while negotiating with overseas buyer.  You may not remember the cost of a product.

It may also be difficult for you to remember the profit margin built in various prices quoted by you.  A clear jotting of this information is not free from the risk of being leaked out to the competitors or to the overseas buyers.

Some coding is, therefore, essential for the prices quoted by you so that at any stage/ point of time, you can always utilize the information enabling you to profitably negotiate with the overseas buyers.

This can be done by assigning codes to the cost prices

Processing an Export Order as a exporters India.

You should first acknowledge the export order, and then proceed to examine carefully in respect of items, specification, Pre-shipment inspection, payment conditions, special packaging, labeling and marketing requirements, shipments and delivery date, marine insurance, documentation etc.

and if you are satisfied on these aspects, a formal confirmation should be sent to the buyer, otherwise clarification should be sought from the buyer before confirming the order.

After confirmation of the export order immediate steps should be taken for procurement/manufacture of the export goods. In the meanwhile, you should proceed to enter into a formal export contract with the overseas buyer.

 Entering into export Contract as export import Business.

In order to avoid disputes, if is necessary to enter into an export contract with the overseas buyer. For this purpose. Export contract should be carefully drafter incorporating comprehensive but in precise terms.

All relevant and important conditions of the trade deal. There should not be any ambiguity regarding the exact specific actions of goods and terms of sale including export price.

Mode of payment, storage and distribution methods, type of packaging.  Port of shipment, delivery schedule etc.  The different aspects of an export contract are enumerated as under:

  1.    Product, Standard and Specifications.
  2. Total Value of the contract.
  3. Terms of Delivery.
  4. Duties and Charges,
  5. Period of Delivery/Shipment.
  6. Labelling and Marking.
  7. Terms of Payment – Amount /Mode and Currency.
  8. Discounts and Commissions.
  9. Licences and Permits.
  10. Documentary Requirements.
  11. Force Majeure of Excuse for Non-Performance of Contract.

It will not be out of place to mention here the importance of arbitration clause in an export contract. Court proceedings do not offer a satisfactory method for settlement of commercial disputes as they involve inevitable delays, costs and technicalities.

On the other hand, arbitration provides an economics, expeditious and informal remedy for settlement of commercial disputes.

Arbitration proceedings are conducted in privacy and the awards are kept confidential. The Arbitrator is usually an expert in the subject’s matter of dispute.

The dates for arbitration meetings are fixed with the convenience of all concerned. Thus arbitration is the most suitable way for the settlements of commercial disputes and it may be invariable used by the businessmen in their commercial dealings.

Export Pricing and Costing to importers in USA

Export pricing should be differentiated from export costing. Price is what we offer to the customer. Cost is the price that we pay/incur for the product. Price includes our profit margin.  Cost includes only expenses. We have incurred.

Export pricing is the most important tool for promoting sales and facing international competition. The price has to be realistically worked out taking into consideration all export benefits and expenses.

However there is no fixed formula for successful export pricing. It will differ from exporter to exporter depending upon whether the exporter is a merchant agency.

You should also assess the strength of your competitor and anticipate the move of the competitor in the market. Pricing strategies will depend on various circumstantial situations.

You can still be competitive with higher price but with better delivery package or other advantages. Your prices will be determined by the following factors:

  • Range of products offered.
  • Prompt deliveries and continuity in supply.
  • After Sales Service in products like machine tools, consumer durables.
  • Product differentiation and brand image.
  • Frequency of purchase and total Annual Requirement.
  • Presumed relationship between quality and price.
  • Specialty value goods and gifts items.
  • Credit Offered.
  • Preference or prejudice for products originating from a particular source.
  • Aggressive marketing and sales promotion;
  • Prompt acceptance and settlement of claims:
  • Unique value goods and gift items.

Indian Agricultural Exports Imports.