Interested in the Import Export business and you don’t know exactly what it is or how to start?
Then this guide is created for you
In this guide, you will learn exactly what the import export business is all about and how to get started. If you are interested in learning more, you can check out our export business training academy.
Okay. Let’s dive in
What is Import Export Business?
In simple terms, import export business usually referred to purchase of goods or inflow of goods and services from one country to another country.
To properly comprehend import-export business, we have to define International Trade. International Trade (Foreign trade, international business, External trade or Inter-regional trade) is usually referred to the exchange of goods, and services across international borders or territories.
If it involves the purchase of goods by one country from another country or inflow of goods and services from foreign country to home country, it is termed IMPORT. On the other hand, if it involves the sale of goods by one country to another country or outflow of goods from home country to foreign country, it is called EXPORT.
Steps to Start an Import Export Business from Home
The following are the steps involved in a typical import process include:
- Importer and Exporter sign Sale Contract
- Exporter sends PFI and Product Certificate (if regulated by SON) to buyer in Nigeria
- Importer collates Pre-Import Documentation (e-Form M, PFI, Insurance, relevant permit)
- Importer fills the e-Form M online (www.trade.gov.ng) and upload relevant documents and submit it
- Upon submission, the documents are transmitted to the selected Bank for review and endorsement
- The Bank reviews the documents and do KYC. If found to be in order, it transmits the documents are to NCS
- Nigerian Custom Service (NCS) approves and registers e-Form M
- The Bank Establishes LC (if applicable)
- Importer instructs the seller to ship the goods
- The seller ships the goods and sends documents to the Importer’s Bank
- Importer’s Bank processes Documents and transmit it the NCS
- NCS issues the Pre-Arrival Assessment Report (PAAR) and sends it to the Importer’s Bank
- The Bank releases the shipping documents and PAAR to the Importer
- Importer delivers shipping documents and PAAR to the clearing agent
- Clearing agent obtains assessment notice from Customs to pay Duty
- Clearing agent pays duty, clear the goods and deliver to the Importer
Import Export Business Process:
The following are the process involved in a typical export process include:
- Export Planning
- Contract sourcing and signing by both parties
- Commodity Procurement
- Pre-export documentation
- Warehousing and container booking
- Inspection by buyer’s agent, customs and cobalt
- Stuffing and sealing of container
- Haulage to the ports and delivery to the shipping line
- Export clearance with customs and other agencies at the Port
- Post Export documentation
- Documents delivered to the exporter’s bank
- Documents delivered to the importer’s bank
- Payment effected by the importer’s bank
- Exporter’s account credited
Import export business ideas
Now that we understand the steps and process involved in import-export business, let us look at some of the business ideas behind the industry.
When starting an import export business, you can either export or import anything ranging from Agric commodities, handi-craft, horticultural products, vegetables and spices, solid minerals and manufactured goods can be exported.
Please note that you need to cross-check with the Customs of your country to be sure what you want to export is not prohibited.
How to Start Import Export business Without Investment?
First and foremost you need to know your market and also make sure you have the high demand for your products.
Do you need any import export business license?
The following are the pre-import documents needed to execute an import transaction:
- Duly completed form M (now electronic form M)
- Proforma Invoice
- Local Marine Insurance
- Certificate of registration with CAC
- Permits like NAFDAC, DPR, SON, PHCN etc
To export to any country from Nigeria, you need to get an export license, you can visitthe Nigerian Export Promotion Council (NEPC). Documents required to get this include
- Your Company’s Certificate of Incorporation
- Memorandum of Association (MEMAT) and
- Company’s particulars of director
That is your introductory guide to the import-export business. If you need more information, you can get started here.
What challenges are you facing with import or exporting your goods or services from one country to another? Drop your questions in the comment. We love to hear from you.