How to Import into the USA
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About Me
About CITD
About You
How to Import into the USA
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Basic Business Practices
Have fun Apply common sense Define what you want to be Is importing a different business? Can I sell imported products at a
profit? Keep records. Count everything Expect to keep different hours. Be
Flexible
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IMPORTING IS DIFFERENT Logistics Change Effort Time Travel Money Payments
Commitment Culture Buyer Needs Channels of Distribution Regulations Time Zones Language
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OR IS IT?
Still need to sell product procured abroad at a profit
Do not discount domestic capabilities
Get quotes from domestic producers
Compare. Add the time, effort, uncertainty and relative lack of recourse of foreign sourced goods
Do I need license to import
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What is an HS Number and How do I get one
Harmonized Tariff Systems http://dataweb.usitc.gov/ http://dataweb.usitc.gov/scripts/
tariff2001.asp
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WHY IMPORT To buy directly from the source abroad To acquire products not manufactured in own
country Cost benefits , cost quality considerations Made to order flexibility Take advantages of other countries export
promotions
To expand, enhance your business line To offset export operation To travel abroad Minimize taxes, travel abroad To make a profit Establish business credibility
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Basics business practices Is it legal Knowledge of the business Knowledge of the Import Process Business etiquette as applied to source
country Accept verbal commitments as stated
in a written fully executed contract (in English)
Trust is nice but ………... Be flexible Use professionals
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More ………...
Keep it simple Know your
market Define limitations Make a cold
financial assessment
Is it worth it? Has it been worth
it? Why pay?
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Sourcing your product I have the ideal product/service I will be able to sell it at a PROFIT. I know that someone somewhere has
sourced a product similar to mine at a lower price and that someone is selling it at a higher price. I just need to find the source
Do not wait for perfection. Settle for pass
Always seek U.S. sources for comparison
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WHERE TO SOURCE YOUR PRODUCT
Embassies/ Consulates Commercial Attaches Associations AMCHAMS ASK THE SELLERS alibaba.com taiwantrade.com
proeastwest.com tradeline.com.br asiansources.com eurotradeleads.com busytrade.com buysellex.com cometotrade.com globalspec,.com
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MORE WEBSITES
imex.com microline.com trade-circuit.cov vendorbase.comlabl.com ectrade.com europages.com 5five.tv/tradeleads.htm
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Sourcing, defining your needs
Define your needs Have them in
writing Are they reasonable Is there a mutually
beneficial relationship between yours and your potential supplier needs.
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Sourcing, on business relations Define relationship Recognize imports = different culture Quality issues Production issues Logistical issues Payment concerns Be prepared to do business Have adequate working capital
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Import ProductsEasy to Import: Crafts/Artwork/Glass Gems/Semi-precious Household appliances Tools/Sporting goods Musical instruments Leather goods Stationery / Paper goods
Difficult: Drugs/Spirits Aerospace/Radioactive Animal live Used merchandise Foods/Cosmetics Chemicals/Combustibles Weapons/Explosives Vehicles
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Commonly Prohibited Embargoed Countries ustreas.gov/ofac National treasures, archeological finds Material considered pornographic Food or products raised in infected countries
(foot & mouth; mad cow)
Products that violate intellectual or industrial right laws
Products from endangered species Drugs not approved by FDA Other
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DO I NEED A LICENSE TO IMPORT GOODS
U.S. Customs Service does not require an import license for goods brought into the United States. However, other agencies may require a license or certification.
FDA, DOE, DOJ, EPA, , Textiles, Federal Trade Commission, Wildlife Dep. Of Interior
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Due diligence
Check your potential supplier Talk to competitors Distributors Equivalent BBB Check with the US Embassy Inquire with friends and
acquaintances Check with Intl. Clubs (Moose, Elk,
Lions, Rotary, Masons & other fauna)
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More on due diligence
Secure suppliers start small Common sense vs genius Federal, state, county and city
agencies Check, recheck your assumptions Remember cultural, linguistics and
geographical differences Use plain, simple, idiom-free
language.
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How Do I Get Started?
Select a product or service: Apply common sense Stick with what you know Use your cultural knowledge Perform marketing research Niche product, in niche market Management Commitment
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WHAT AM I?
IMPORT TRADING COMPANY? (Manufacturing Rep)
IMPORT MANAGEMENT? (Wholesaler/Distributor)
MANUFACTURER? – Value Added Reseller (Inputs transformed into goods)
RETAILER?
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Import Trading:Primary Activity: Sell products to domestic buyers
Take title to goods Buy product from the manufacturer & resell
Arrange for shipping and payment
Advantages: You determine price; can make more money
Long term relationship with both manufacturer and foreign buyer
Overall, have more control in the marketplace Disadvantages: More liability
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IMPORT MANAGEMENT Primary Activity: Sell foreign goods to domestic buyers
Don’t take title, put buyer & manufacturer together
Receive Commission Shipping arranged by manufacturer Payment arranged by manufacturer
Advantage: Less liability
Disadvantages: Manufacturer could determine price
Manufacturer will try to terminate relationship Less control
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Once a product is selected.. What do we want (as company) to gain
from importing Is importing consistent with company
goals? What demands will importing place on
key resources? How will they be met Are the expected benefits worth the
costs or should the resources better used in new domestic business?
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Perform Market Research Questions To Ask:
Manufactured in country? Is other competition there? What price is product being sold at? Is there cultural applicability? Product meet USA standards?
Can it be adapted to standards? If so, $ Restrictions or regulations? What are the different markets for your
products? Who are the distributors? Who are the final consumers
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How To Perform Marketing Research
TALK TO YOUR COMPETITORS WWW.STATS-USA.GOV USE ASSOCIATION USE INTERNET
Call End Users Visit the BRC!!! http://dataweb.usitc.gov USE OTHER COUNTRIES RESEARCH!!! I.E., http://www.atn-riae.agr.ca
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How do I get an HTS Number
1. Harmonized Tariff # Search http://www.census.gov/foreign-trade/schedules/b/index.html
2. Entire HTS usitc.gov/tata/hts/bychapter/index.htm
3. http://rulings.customs.gov/
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Your Partners Your clients Your procurement source Custom Broker Freight Forwarder International Banker Attorney Custom Lawyer Certified Public Accountant
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Freight Forwarder
They move freight internationally Don’t confuse with a
custom broker
Information you need: Weight of shipment Dimensions of shipment Where it is being
shipped from Where it is being
shipped to Collect or prepaid
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CUSTOM BROKER
Efficiently & legally obtain clearance through customs
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Incoterms 2000
EXW: City, State, Country
CIF CFR FOB DDP
International
Commercial
Terms
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Pricing Products Cost from foreign manufacturer Freight /Insurance Duty / Custom Broker Other Costs /Indirect Costs Profit Distributor mark-up Retail mark-up Cost comparison – Competition Price Common sense test
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Documentation SLI: Shippers Import Declaration/Bill of
Lading/Carrier Certificate naming consignee
Commercial Invoice from Exporter, showing value & describing merchandise
Packing List Certificate of Origin Entry Manifest Customs Form 7533 or
Entry Immediate Delivery (Customs Form 3461)
Rely on your custom broker
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Contact The Manufacturer
Obtain exclusivity Right to commercialize product Check USPTO Brochures Samples Warranties – Guaranties Marketing Allocation
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How Will You Pay The Manufacturer?
Terms Letter of Credit Wire Transfer Payment in advance
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Purchase OrderProvide Information For Seller to Make a Sales Decision
Your Company Name Buyers Name Date Reference Number Quantity Description Unit Price Extended Price
Currency Weight of Product Dimensions of Product Packed Country of Origin Point of Delivery Payment Terms Request Valid For
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Intellectual Property – Contractual Obligations Trademarks – Who owns what Exclusive Distribution Arrangements Warranties - Replacements Shared Marketing Costs Royalties
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Getting Paid
USD Dollars Do not sell on open terms or
consignment Credit Card Industry Payment Terms Checks PAYPAL..COM ESCROW.COM
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Information
Commercial Attaches Business Associations (I.e,
Korean/America, Hungarian American, etc)
AMCHAM US Embassy Web - Thousands of organizations Friends, acquaintances, PXs,
churches, etc.
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More
Go to fairs, network Keep proper records When is best to use a wholesaler
rather than the source Ask your competitors International yellow pages Settle on pass not A++
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A few websites
www.citd.org/trade_info/index.cfm calcitd.ning.com thomasregister.com http://www.cbp.gov/ US Customs http://global.broad.msu.edu/ibc/
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On contracts, trademarks, distribution agreements, pro forma invoices, and …. Understand the terms as understood
by others Contracts should always be in
English Do not agree to something you do
not fully understand Leverage available resources Take your time Persevere
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BUSINESS PLAN - FIRST DRAFT
Primary objective is to develop a Draft
Will indicate what next steps to take Quick & dirty Overall guide Reality test
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Draft Business Plan must address
Product selection and modifications if any. What source countries are targeted For each product what is the basic
costumer profile What marketing and channels What special challenges to each and how
to overcome them How will the products’ import sales price
be determined What specific operational steps must be
taken and
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Customer Service
You must service your accounts!!!
Customer Service Academy
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Q & A
Riverside CITD Robert Corona
(951) 571 -6443 (909) 486-3344 www.citd.org