An export business sells products to a country other than the one where the goods are manufactured.More than 96 percent of exporters in the United States are small business owners.You will need to decide which products you will sell, complete the requirements for establishing a business, find funding, and develop channels to sell your goods in other countries to start an export business.
Step 1: Understand the export business.
You will need to understand the industry and how the exportation process works in order to start exporting.Visit the websites of the U.S. Department of Commerce and Export America to research the export business.If you already know which countries you want to export to, you can start learning about them.It is helpful to have an understanding of a foreign language.If you have experience in international trade or shipping, you can prepare yourself for the challenges of running an export business.The Small Business Administration can provide further assistance.The Export Assistance Centers provide specialized export advice.To find one near you, visit the SBA's website at https://www.sba.gov/managing-business/exporting/us-export-assistance-centers.
Step 2: Decide what type of business you will start.
There are three main types of business operation.Each one focuses on different aspects of the market and serves a slightly different type of customer.An export management company is one of the types.Marketing and selling products overseas is assumed by these businesses.Domestic producers who are unwilling to work overseas themselves usually buy from such a company.An export merchant purchases goods from domestic producers and then sells them to other countries.ETCs look for specific goods to satisfy their overseas buyers.
Step 3: Determine what you will sell.
The products you plan to sell include whether you will manufacture them yourself or purchase the goods wholesale.You don't have a set guide for determining exactly to sell, but you will need to beat out both other exporters of that good and domestic producers in the country you are selling to.In a foreign market, your product must be unique, lower-priced or better quality than the competition.Unavailability in a foreign market is one of the three categories of exported goods.These are things that your target country can't produce.Iceland has to import pineapples.It's a source of reputation.If the goods are from a location like French wine or Italian shoes, they are considered to be of higher quality.The price is lower.These are goods that can be produced in another country at a lower price than in your country.It is possible that your export business is an extension of your domestic sales operation.If you get a lot of foreign requests for one of your products, consider expanding to serve that market.
Step 4: Do you know your target market?
Identifying who you will be selling to is the first thing you need to do.Do you know who would be interested in buying your product?Consumers, retailers, manufacturers, wholesalers, governments, or another foreign entity can be this.If you are already in business domestically, you should look for customers in the same industry.Use any connections you can make to your advantage if you work with your domestic colleagues to see if they have any contacts overseas.If you can locate a market in which your business has a price or efficiency advantage, that would be great.Visit trade shows, conferences, and missions to learn more about your market.You will be able to meet prospective agents and check in on your competition at these events.You don't have to host a booth, just walk around and get a feel for the market.Inter-country payment processes and currency differences should be assessed as part of your market identification process.Make sure you can safely receive payment from the target country and look out for favorable exchange rates.
Step 5: Understand your consumer.
Determine their needs and desires for your product.Your market should be easy to identify after you decide what type of products you will sell; however, in some cases, you may need to alter your product offerings to meet their needs.This will take a bit of trial and error along with foreign customer interaction.Try to get a better idea of your product's applications and marketability in the target country by using research.Your end- user is who will actually use your products.The status of the target country's economy and citizens' purchasing habits.How can you enter the market?The culture and ethics of your target market should be studied.This will help you in meetings with prospective buyers.You can find websites and books that will help you understand your market's culture.There are publications that deal with international trade.Look for market reports, financial news, and foreign newspapers.It's worth reading if you think you can get a business idea.
Step 6: It's important to maintain compliance with the U.S.
There are a lot of important laws in the United States.The Foreign Corrupt Practices Act is relevant for export businesses.The intent of the law is to prevent U.S. businesses from engaging in illegal business practices.As foreign officials may make it unclear what charges are legally required and which are carefully-planted bribes, be sure to study this law and the laws of the target country carefully.Certain countries have trade restrictions and embargoes in place.These restrict the sale of certain products to certain countries as a matter of national security or policy.Make sure your goods don't fall under one of the regulations by checking with US Customs.Information on embargoes, restrictions, limits, and barriers can be found at http://www.export.gov.
Step 7: Write a business plan.
A business plan is an overview of how your business will operate.descriptions of the products that will be sold, your target markets, a marketing plan, industry analysis, competitor analysis and earnings projections are included.You will need to specify how you will fund your business and partners.You will make decisions about the size of your business.You have to decide if it will be home-based with you as the sole employee or if you will need to lease or purchase a work space and hire a staff.Information about writing a business plan can be found on the SBA website.Licensing and funding information can be found on the SBA website.Write out how you plan to make money in your business plan.How much of a commission will you charge if you add it to the price of items you are exporting?Your own expenses, your own market research, and your competitors' prices will all affect the commission you charge.There is a 10 percent commission for many exporters.If you are exporting the products yourself, you will be able to mark them up a lot more.Before pricing your own goods, make sure to check your competitors' prices.How you plan to sell your products in foreign countries should be included in your marketing plan.You should have already identified your market and how you will target it.Think about what type of person would be interested in your product.Consider the group's ability to pay for your product.To create a product that fills a specific need, you need to identify a market niche.This will make it easier to identify your target audience.The rest of your marketing plan should be focused on that target audience.One of the 18 countries that enjoy free trade with the United States is a good place to start.There is a list of these countries at the UStr.gov.
Step 8: You should estimate your startup costs.
Depending on the type of export business, products sold, foreign market, and other factors, your startup costs can range from under $5,000 to over $1 million.You will need an office space, a computer, business phone line, fax machine, and relevant utilities to service those machines.You may need money to travel to places you are selling to for meetings with partners.You will need money to purchase your initial inventory if you plan to sell products yourself.Your startup costs will be affected by all of this.It's okay to start small.If you find success, increase your efforts and test the waters first.Cash flows from your first sale should be used to finance later sales.
Step 9: You need to register your business and apply for a license.
Call your state government.The secretary of state's office is where businesses are registered in most states.Information and applications can be found on your state government's website.Depending on your state laws and business structure, the process for registration and licensing will be different.You will need to register with the US Government at export.gov if you want to be an export business.If you are exporting certain products, additional licenses may be required.You can check with US Customs or the SBA.To find out if the name you want to use for your company is available, do a preliminary business name search on your state government's website.Determine the structure for your business.Sole proprietor, limited liability partnership, and corporation are some business types.Be sure to apply for the license that's right for you.There are different requirements and fees for each license.
Step 10: Find money.
You can get funding for your business from the Small Business Association.Small businesses can get guaranteed loan programs from the SBA.The Export Working Capital Program provides money to service large contracts before payment is received for that contract.You can either work with a partner or use your own money.Special financing programs for small businesses are offered by the U.S. Export-Import Bank.The Export-Import Bank has loan programs for minority and woman-owned businesses.
Step 11: Get a policy.
Tracking down buyers who fail to pay for the goods you deliver to them will be difficult when dealing with foreign buyers.If you want to fix this problem, you can purchase export credit insurance.It usually covers payments not made due to business issues, like bankruptcy, or political issues like revolution or government seizure of property.Commercial insurance providers and the US Export-Import Bank can provide coverage.
Step 12: Office and storage space can be rented.
Depending on the nature of your business, your space needs will vary.You will need a warehouse or at least storage space if you plan to hold product.If you don't need a lot of storage space or will not be handling products yourself, you can work from home, but you should also look for office space.
Step 13: If you want to export your products, partner with a company or individual.
It can be difficult for small business owners with no connections to make successful sales abroad.It's best to work with a foreign distributor or another agent that already has a network in your target country.Your foreign contact can be an agent or a partner.An agent works for a defined level of pay, whereas a partner shares in the profits and liabilities of the business.The Gold Key Matching Service is offered by the US government.Visit http://www.export.gov to learn more.You could work a foreign distributor or retailer to get your product into the market.Look out for a foreign sales representative who will sell your products on your behalf.
Step 14: Take advantage of technology.
The internet is the most cost-effective way to create an overseas network.The first thing to do is to create a website.This site will have to act as the face of your business to many international clients, who will look up your website as a first step before doing business with you.It's important to include a description and pictures of products.There is a website in the language of the country where goods are being exported.Look for international trade and export forums, chat boards, and directories.Post on them with an offer and link to your website if you find some that are relevant to you.
Step 15: Take care of shipping.
When exporting goods, you have to decide how to get them to your customers.Land transportation is cost-effective if you are shipping to a country like Canada or Mexico.You can choose between air or maritime shipping when shipping further away.Air shipping can be more expensive than land shipping.Long gaps between when the product leaves you and when it arrives could be caused by maritime shipping, which is slower and cheaper.To figure out which option is best for your business, work with an international freight forwarder.Free shipping can be found on board or alongside the buyer.The seller is responsible for delivering the goods to the buyer at no additional cost.FAS means that the seller transports the goods to a ship, where the buyer pays to have them loaded and shipped.You can organize your shipping, storage, and documentation with the help of a freight forwarder.Personal recommendations or local listings can be used to find freight forwarder contacts.
Step 16: Deals are made with buyers.
When you locate buyers, you should check out their operations and creditworthiness to make sure you are paid for your goods.To confirm that they have a good business rating, run a web search for their business.Make sure to record any verbal agreements you have with buyers.If you can't communicate effectively with the buyer, you should hire a translator.US Embassies may be able to help you assess a prospective customer's reputation.
Step 17: Payment and pricing terms should be set.
You have to decide if you want to price your goods in dollars or in the target country's currency.Working in dollars simplifies your accounting and protects your end from currency fluctuations, but can make trade more difficult for foreign customers.Make a choice and stick to it.If you decide to work in the target country's currency, be aware of the foreign exchange risk.If the foreign currency is devaluing against the U.S. dollar, you will lose money.Pricing your sales in the foreign currency in exchange for cash in advance is one of the ways you can manage this risk.As payment for your products is "processing" or "awaiting approval" on your customer's end, you need to set clear payment terms so that you are not left out to dry.Foreign buyers often use letters of credit to make payments.To receive this type of payment, you may need to contact your bank.A letter of credit is more important to the seller than the buyer.It is difficult to collect debts in a foreign country.Credit cards and bank transfers should be used before shipping small items.A large international bank with a presence in both your country and the target country can be used to simplify payment.
Step 18: The documentation needs to be filed.
You will have to deal with a lot of government paperwork in both the US and the target country when you start exporting.If you get confused, your overseas partners and/or any shipping partners you have should be able to help you out, especially if they are very experienced in that country.
Step 19: You need to fill your first orders.
Pack and ship your goods when you find an overseas buyer.A pro forma invoice is a quote for the price of your products, along with the costs of insuring and shipping them, if this is charged to the importer.You should organize your shipping and insurance with the relevant companies.Make sure the payment arrives before the shipment of the goods.Pack your goods and have them shipped when it happens.Save any documentation you receive.Wait for your buyer to confirm that your goods have arrived.You just made your first export sale.The bill of lading will be sent after your items ship.The document guarantees that your items arrived in good shape.