Five Biggest Challenges of Importers and Exporters-Infographic

The challenges of importing and exporting goods are very real. In today’s globalized economy, economies must be prepared to deal with the volatility of trading partners and unstable currencies. As a result, even the most well-planned trade transactions can become riddled with errors, which can quickly erode the gains that have been made. Importers and exporters are therefore always at risk of experiencing currency mismatches. These occur when a country’s currency moves in relation to another country.

This kind of situation occurs for a number of reasons. For example, depending on the type of product being imported or exported, the importer may have purchased their goods from a different country at a lower price than they paid for them in their own currency. In order to counteract this, exporters will usually hold back on selling a given good until a favorable rate has been achieved. By holding back on selling a particular good, they will ensure that the foreign country becomes more likely to buy their goods.

Apart from currency mismatch, here are other challenges that importers and exporters regularly face in the competitive world of commerce:

Customs Broker

  1. Finding the Right Licensed Customs Broker

There are numerous licensed customs brokerage firms that offer high-quality services to their valued customers, regardless of what type of products they sell. However, some licensed customs brokers are more skilled in handling clients of a specific industry, and choosing one that possesses vast knowledge about your products is definitely an advantage. If you are looking for ways to grow your business, finding the right licensed customs broker that can provide expert advice on how to clear your products on customs authorities is a must.

  1. Planning a Foolproof Logistics Plan

Planning your overall logistics needs for shipping products can be a recurring headache. Since it is a critical factor in any trading business, you have to be extra careful at all times. It usually consists of several processes wherein a single glitch or error could result in dire consequences, such as delays in your shipment’s arrival. Ensuring your products arrive safely on time should always be on top of your priorities.

  1. Calculating the Total Expenses

One of the most grueling financial hurdles in international trade is paying hidden charges. When shipping products abroad, you will most likely burden yourself with additional expenses, especially if you hired an unreliable licensed customs broker.

Some of these hidden charges in shipping include the following:

  • Less than Container Load (LCL) charges
  • Port fees
  • Chassis fees
  • Wait Time fee
  • Customs Exams
  1. Preventing Document Backlogs

These involve the delays that might happen during the documentation process, primarily if the importer or freight forwarder in charge provided inaccurate information about their shipment. Complying with the requirements properly will help eliminate all the unnecessary expenses you might bear in committing mistakes in documentation like penalties.

  1. Adjusting to New Rules and Regulations

Regulations in the importing or exporting country can change at any moment, and this alone can sometimes become a nightmare for international traders. A worse-case-scenario would be like transporting an item to a country that suddenly imposes a ban on that very same item. That is why having a freight forwarder, and a licensed customs broker with a wide area of connections can help a lot in detecting these possible fluctuations in rules and regulations.

Excelsior Worldwide Freight Logistics conducts free orientation for those who are willing to learn. It is our advocacy to share our knowledge & experience worth more than a decade in the business. Visit our website today at www.excelsior.ph to learn more about our service.

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Tips Before Starting an Import/Export Business

Tips Before Starting an Import/Export Business

Setting up a business is not a simple task, let alone offering products that can reach more people on an international scale. If you’re an aspiring entrepreneur looking to plunge into the tough competition of foreign commerce, you must be equipped with adequate skills and knowledge in order to survive.

Running an import-export business is now much more convenient than before with the advent of modern technology. The use of the internet to communicate with customers has become commonplace and the learning curve in managing different operations mostly requires competent organizational skills.

While you don’t have to be an expert in this kind of industry, it is still a necessity to be aware of certain things that can optimize your chance of growth as well as minimize the effects of potential risks. The possibility of failure is always present in any form of business, so you should always pay attention to every detail.

Here are some of the best tips that can help you when starting out an import or export business:

Consider Your Products

Since you will be taking on an import-export trade, the products that you’re going to sell can become the X factor for fate of your company for the following years. Think carefully when deciding which product should you sell and be sure to stick with it. Once you figured out the best products for you, use your judging skills to know whether these products are worth your investment or not.

Always keep these two important questions in mind:

  • Do people want those products?
  • Do you know how to sell it properly?

If you are confident that your products can become something that is sought-after by many people across cultures and you know at least the fundamentals of selling it properly, then you now have a set of products to sell.

Find Your Target Market

So you already have some products to sell, and the next problem you need to solve is how you can find the people that are more than willing to buy them. Those people are your customers, your target market. Identifying them from a specific country can be a herculean task, so you’ll be needing extra time and probably a hand to do this the right way.

Prepare in-depth research regarding the latest market trends of the particular location where you desire to offer your products. There are several agencies that can do this for you in case you have a pretty hectic schedule.

Set up a Website and Develop an Online Presence

Creating a website provides your company and your products the needed exposure for online users around the world. Take advantage of multiple online platforms to market your products especially your target market. Be responsive to customer feedback and complaints and establish an online community that can enhance their loyalty and ultimately accumulate sales for your company.

Amp up Your Logistics Connection

One of the most challenging things that your import-transport business will have to overcome is making a solid system or plan on transporting your products. With a bunch of legal processes that concern your line of profession, you must be ready to outsource services in logistics. Take for example freight forwarders. Hiring a freight forwarding agency can significantly lessen your load of tasks in complying with customs requirements and other legal processes. They can even help you find the best carrier so that you can cut down your expenses in shipping.

Excelsior Worldwide Freight Logistics conducts free orientation for those who are willing to learn. It is our advocacy to share our knowledge & experience worth more than a decade in the business. Visit our website today at www.excelsior.ph to learn more about our service.

 

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Shipping Terms Every International Importer and Exporter Should Know

Shipping Terms Every International Importer and Exporter Should Know

If you’ve been managing a business for quite some time now, you might’ve experienced some difficulties when it comes shipping your goods from one place to another. Aside from ensuring the safety and timely arrival of your cargo, you also need to familiarize yourself to several jargons associated with the shipping industry. Most business owners nowadays ended up getting confused about some of the technical terms used in shipping. While you don’t really have to be a pure expert when it comes in dealing with these terms, your knowledge about them could prove to be pretty handy in the future indeed.

So, to help you avoid unnecessary misunderstandings and minimize errors while you communicate with your shipping company, here are some of the most common terminology used in international shipping:

Bill of Lading (BoL)

Bill of Lading, also known as BoL is a document given by a carrier to a shipper. This document is issued on a receipt form with the sign of the vessel’s representative and acts as a written proof of contract that a transportation has been made. 

This document is very important as many ports do not allow anyone to claim their goods without presenting their BoL. Unfortunately, some notorious freight forwarding scammers use BoL as a way to steal money from the others. Know more about the other freight forwarding scams through this infographic here.

Carrier

Carriers can be an individual or legal entity that offers transporting services for passengers and goods. Examples of carriers are airlines, shipping lines, railroad and trucking companies.

Backhaul

If a driver takes a cargo during the return trip of a commercial vehicle, it’s technically referred to as a backhaul. Cargo vehicles do this practice as a way to maximize the productivity of their trips.

Customs Broker

Customs Brokers are private individual or firms that works as a guide for both importers and exporters in meeting the necessary requirements given by the customs authorities. Many people usually mistook customs brokers to freight forwarders, but both professions have several distinctions with each other.

Freight Forwarder

These are persons or company that specializes in logistics and organizing shipping processes in place of an individual or company to transport their goods.

Hazmat

A shortened term for “hazardous materials,” hazmat is a material that could pose safety risks to anyone that it comes in contact with. Unlike other forms of cargo, shipping hazmat requires special endorsements from all involved parties.

Intermodal

Cargo can be considered as an intermodal once it was shipped using multiple forms of transportation, like a cargo truck and rail transport.

Less Than Truckload (LTL)

When the weight of a shipment ended up being less than the required weight of the truckload rate, that is described as Less Than Truckload or LTL.

Tender

Tender is a fixed cost to move a cargo.

Transportation Management System (TMS)

Transportation Management Systems or TMS is a software designed to help businesses and even some freight forwarding companies to optimize their planning and execution in the physical movement of the goods. There are several benefits that can be obtained by investing in this kind of system.

 

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5 Important Tips for New Importers

5 Important Tips for New Importers

Importing basically refers to the act of buying goods and services from abroad in order for it to be sold for the customers of the home country. Many business owners nowadays prefer to sell imported products due to its ability to increase profit margins. Moreover, an importer can provide higher quality goods that can potentially surpass those produced by local competitors. If done in moderation, importing can help bolster the national economy as well as widen up the global market.

Despite the benefits of this practice, importing can be a pretty risky option especially for those who are still establishing their foothold in the world of commerce. Purchasing goods from a foreign land requires a specific set of knowledge and skills and a deeper understanding of complex processes of importation.

If you’re starting to think that importing is the next big step for your business, here are some of the most important tips you should be aware of before making any move:

  • Make sure you are legible to do the importing

Speaking about legibility, it means that you have to be legally allowed to bring those imported goods to your home country. Before you can spend any time, money, and effort into something such as importing, you’ll need thorough research about the laws especially the restrictions of items that you are going to import. Some chemicals and medicines, in particular, are examples of products that could have certain restrictions. Check the legality of the products that you wanted to import first.

  • Assess all the possible expenses

Planning your budget ahead of time is very important if you wanted to be a successful importer. Be mindful of all the possible expenses before you can place an order to a company abroad. These charges can range from the transport and insurance costs, as well as other legal documents that you need to go through. A good way to limit or minimize these expenses is by hiring freight forwarders and customs brokers since they have the expertise to guide you through the process and find all the best deals for shipping available.

  • Pay attention to sudden exchange rate fluctuations

One notable example of risks that every importer should know is sudden fluctuations in the exchange rate. Remember that you are buying goods from another country with prices that are not the same as your local currency. So be mindful of the current exchange rate as it greatly affects the final amount that you will need to pay. The rate could either become beneficial or detrimental to your success.

  • Learn to interact with your foreign suppliers

It’s not easy to deal with suppliers from another country. Language and culture barriers are some of the challenges an importer has to face. Miscommunication could become pretty common in these areas, so better study a lot about the business industry of their country as much as possible.

  • Determine if there is a local market for the goods you wanted to import

It is your responsibility as the importer to know if there is a growing demand for the goods that you are opting to resale. Determining your potential customers in the local market can help you identify the profitability of that imported product. Conducting some surveys is also a good way for you to come up with a decision on whether importation is definitely the right choice or not.

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Types of Container Units Used for Shipping Cargo – Infographic

Aside from gargantuan cargo ships, another object that most people often associate with international shipping industry is container units. These long, rigid, metal boxes form the most integral part of the entire shipping industry- and are the structures that shippers rely on to store various types of cargos that need to be transported from point A to point B.

Having said that, a variety of container units can be used depending on the type of products to be shipped or the special features. To know which one suits best to the products your business is shipping, check out this infographic.

Types of Container Units Used for Shipping Cargo

10 Mind Blowing Facts About the Worldwide Shipping Industry

One of the oldest industry in the world is the shipping industry. Though it is often unacknowledged by many of us, it plays a very crucial in today’s global economy. In fact, almost 90% of the things we purchase and use today – from smartphones and construction materials to toiletries and utilities like oil – arrives via ship, according to Rose George in his book Ninety Percent of Everything.

In this post, we will take you on a journey inside the little-known yet very interesting world of shipping and discuss the most amazing facts that surround it.

10 Mind Blowing Facts About the Worldwide Shipping Industry

Why Shipping FOB is Better Than CIF?

Choosing the right Incoterms is a vital part of the shipping process. This ensures that both parties – the seller and the buyer – understands their responsibilities, and at the same time, streamlines the whole shipping process so that the freights are delivered efficiently and in a timely manner.

For shipments that are transported through the inland waterway transport, shippers have four Incoterms to choose from: Free Alongside Ship (FAS), Free on Board (FOB), Cost and Freight (CFR), and Cost, Insurance, Freight (CIF). A detailed explanation of these Incoterms is provided in our previous blog Importer Facts: Choosing Your Agreement Between Your Supplier – Incoterms 2010.
In this post, we will focus on the advantages of FOB over CIF, and why it is a more convenient option for shippers.

Free on Board


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The seller fulfills their obligation when the goods have been delivered on board the vessel nominated by the buyer at the named port of shipment or procures the goods already so delivered. This Incoterms indicates that the seller has to shoulder all the costs and risks of loss and damage to the goods until the goods have finally arrived on board the vessel, and the buyer will bear all costs from that moment onwards.

Cost, Insurance, Freight


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image from campulromanesc

The seller fulfills their obligation to deliver when the goods are already placed on board the vessel nominated by the seller or procure the goods already so delivered. The risks of loss and damage pass when the goods are on board the vessel. Aside from freight and clearance cost, the seller needs to procure and pay for a marine insurance against the buyer’s risks of loss of or damage to the goods while in transit.

Advantages of FOB


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image from pandorf

One of the main reason why many shippers choose FOB than CIF as the term of sale is because it allows for greater control over the freight and the freight expenses. This greater control can help you have an upper hand in minimizing the overall import cost while providing you with maximum convenience as possible.

Most first-time importers usually use CIF to transport small quantities of goods because it also offers convenience by having the seller deal with all the shipping and freight details. However, choosing this agreement can only lead to higher freight cost at the end. This is because the seller can collaborate with their forwarder to increase the markup of the freight cost, allowing them to make a profit. As an importer, you can’t do anything to affect the invoice given to you by the forwarder.

When shipping FOB, you have the power to control the overall shipping process, allowing to make significant cost savings. You can select your own freight carrier, you can choose which route has to be taken, select your own agents to handle the shipments when it arrives, organize an insurance policy as well as set your own transit time.

Another benefit that FOB provides is the convenience and transparency of working with only one contact agency throughout the process. This means that whenever you have questions or issues regarding your freight, you don’t have to meddle with different entities just to get a clear answer and feedbacks. This also ensures that the carrier will be working with only your best interest in mind because their sole purpose is to deliver your goods to its destination.

Shipping CIF on the other hand, is more disadvantageous, especially if your goal is to save money from your shipping cost. It relinquishes you with any control over your shipments while also passing more responsibilities and risks to your part.
The seller can use their preferred shipper and their own transit times. Delayed shipments are also harder to resolve since transportation is beyond your control, and there are other parties that may be involved in different stages which make it harder to obtain information about the cargo. Another factor to consider is that since it was the seller who paid the carrier, there is no obligation to fulfill your needs.

From the buyer’s perspective, FOB offers greater control over the shipping process compared to what CIF does. Not only it provides greater flexibility, but also gives you control over the shipping cost, and subsequently, the overall cost of the cargos.

Contact Excelsior Worldwide Freight Logistics Corp. now and let us help you in your journey in the international trade this 2017 and beyond. Call us at (+632) 525-9775 or email us at wecare@excelsior.ph.

How To Choose The Best Customs Broker

How To Choose The Best Customs Broker

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Customs brokers provide professional and expert service on customs clearance
of goods during importing and exporting. Customs brokers are in charge of
making sure that the rules and regulations of international trade are consistently
met, and they are responsible for the interaction and communication with the
customs of a shipment’s country destination.

There are several factors that must be taken into consideration when it comes to
choosing the best customs broker.

1. Eligibility

The very first thing that you need to check with your customs broker is their
eligibility. Your customs broker must be a license holder, which means that he or
she is an accredited customs broker, and he or she has been able to pass the
licensure examination specific for customs brokers. Moreover, if you are looking
for a customs brokerage company, this company must empower its employees to
become licensed customs brokers.

In order to become a licensed customs broker, one must go through a four-year
course and take a licensure exam, which in the Philippines is administered and
regulated by the Philippine Regulatory Committee (PRC). The intensive
education process that licensed customs brokers goes through enables them to
have the confidence and efficiency that they need to carry out their
responsibilities.

Every country usually has an official list of active brokers from the government. It
will be wise to first check with this list for any customs broker that you will be able
to get in touch with.

For the official list released by the Bureau of Customs of the Philippines, the list
can be found here.

2. Technical Knowledge and Skills

Interfacing with the local and international customs is no mean feat.

The laws, rules, and regulatory requirements pertaining to transport of goods can
be very complex. This is why it is critical for your customs broker to have a high
level of technical knowledge, as well as access to up-to-date information when it
comes to shipments, importation, and exportation. Your customs broker must
have high understanding of entry protocols and requirements, valuation, fines and penalties, taxes, and the like.

3. Track record

It is also wise to ask industry peers for recommended customs brokers, as well
as existing clients of customs brokers for feedback regarding their performance.
This way, you can gauge their integrity, professionalism, and level expertise.

You might also want to consider making sure that your customs broker of choice
has no pending case with the customs of any country.

4. Specialty and experience

The ease of any work always depends on the experience of the one doing the
work. Customs brokerage is no different. You need to consider working with a
customs broker who has had experience, or better yet, has a specialization in the
handling of the goods that you will be shipping.

This way, you will not be caught off guard when it comes to duties, taxes, and regulations, or even obscure agreements and provisions, special cases, or some
exceptions to the rule, if there are any. After all, each country has a unique set of
shipping rules and regulations, and all goods are handled and shipped in a
specific way.

5. Professionalism and Integrity

The customs broker is the one who interfaces with customs in behalf of the
importer or exporter. This means that the customs broker is the one who
represents you and your business. In this regard, it is important to have a
customs broker who is able to satisfy all legal requirements in an efficient,
effective, and ethical way.

Moreover, the goods that you are shipping are valuable, and oftentimes irreplaceable. It is therefore important to make sure that these goods are being
handled by people only with utmost professionalism and unbreakable integrity.

Choosing to work with a customs broker is one thing, and choosing the best
customs broker for your business and your goods is another thing. It is important
to make sure that the customs broker you are working with actually has what it
takes to get the job done for you, and provide you with a service that is
exceptional and efficient.

Excelsior is a freight logistics corporation who not only moves your shipment, but
also takes care of customs clearance on your behalf. Excelsior has been
providing exceptional, excellent, and experienced service for 15 years,
throughout all the phases of shipment – from freight forwarding to customs
brokerage.

You can also be assured that at Excelsior, we value or partners (we treat our
people as partners, not employees). We support and encourage all partners to
become licensed customs brokers. This is to make sure that our clients are
provided only with excellent customs expertise and superior customer service. To
date, 80% of Excelsior Partners are customs administration graduates. Six of the
Excelsior Partners are licensed customs brokers; we are proud to note that this
number exceeds industry average today.

Allow Excelsior Worldwide to help you navigate through the world of import and
export. For more information on our customs brokerage services and to know
more about Excelsior, visit our website today at /. For any
queries that you may have, you may call us at (063) 5259775, or send us an
e-mail through wecare@excelsior.ph.

What Is the Best Freight Forwarding Company?

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Freight forwarding is the process of preparing goods for
transport in behalf of the shipper. The shipping process
includes moving the goods from one carrier to another,
transport tracking, freight consolidation, negotiation of freight
charges, and preparation of necessary documents.

The shipment of goods can be via air, sea, or land.

There are many freight forwarding companies, especially in
this day and age where the importing and exporting industry
is seeing a rising trend. After all, the transportation of goods
across the world is considered to be the keystone of modern society. So how does one know and decide which freight
forwarding company to choose?

1. Owns the carrier

Technically, fright forwarders serve as the middleman
between the shipper and various transportation services to
get the shipment to its destination. However, there are some
freight forwarding companies that own transportation
services like trucks and ships, thus eliminating the need to
coordinate with a third party carrier. As a result, such
companies are able to take full control of the freight
transport, thereby reducing cost, and promoting efficiency
and reliability.

2. Has a significant amount of knowledge and
experience

Of course, a good freight forwarding company needs to have
a good amount of knowledge and experience about
international transportation processes, as well as rules and
regulations on goods transfer.

It is critical for a freight forwarding company to have a
streamlined process of shipping goods in order to promote
efficiency at all times, regardless of the freight being shipped
and the destination of the shipment.

A good freight forwarding company also needs to have
excellent communication, administrative skills, and attention
to detail. Since freight forwarding involves different steps and
involves different people from different companies (such as
supplier, carriers, and warehouse), it is important to make
sure that there is a seamless coordination and a seamless
transaction among all parties involved.

3. Has problem solving skills

It is also important for a freight forwarding company to have
excellent problem solving skills. They need to be able to
identify the problem across the logistics and supply chain,
and provide the necessary solution to prevent any delays in
delivery, as well as to prevent the recurrence of shipping
problems.

4. Ethical and Professional

Lastly, freight forwarding companies must consistently abide
by rules and regulations of goods transfer, and they must
also have a high level of professionalism.

Professionalism can be seen in the way that the company
coordinates and communications with the shipper, as well as
with all other people involved in the shipping process.
Professionalism can also be seen in how the freight
forwarding company keeps their word with regard to
deadlines and shipping schedules.

Allow Excelsior Worldwide to help guide you through the import & export world. Contact us today to learn more about our global logistics . Call (063) 5259775 or email us at wecare@excelsior.ph

No pressing need for DTI reforms, says incoming chief

Mercurio, Richmond (2016, June 20). The Philippine Star. No pressing need for DTI reforms, says incoming chief. Retrieved from http://www.philstar.com/business/2016/06/20/1594535/no-pressing-need-dti-reforms-says-incoming-chief

MANILA, Philippines – Change is coming with the Duterte administration but that may not be necessary to the Department of Trade and Industry (DTI), said incoming secretary Ramon Lopez who sees no need to initiate drastic reforms in the agency.

“It’s not complicated because DTI as we all know is doing a lot of good things so definitely all the good programs will have to continue and even be enhanced. Of course there will be a continuing review of programs that will probably be prioritized and less prioritized,” Lopez said in an interview.

“In terms of the officials, I gave my commitment for continuity. I’m willing to retain the undersecretaries and assistant secretaries, The question is if they also want to. But for me, I’m open but I have to also review their performance,” he added.

Lopez said he met with outgoing Trade Secretary Adrian Cristobal Jr. last week to discuss and facilitate the transition at the agency.

ccording to Lopez, incoming president Rodrigo Duterte has only two primary mandates for him as head of the country’s trade and investment promotions agency – uplift the quality of life of Filipinos through entrepreneurship and no corruption.

“At the focus of the incoming president is uplifting the poor, the quality of life through entrepreneurship, through business. To support the growth of micro, small and medium enterprises (MSMEs) through interventions and to build a climate that is conducive to business,” he said.

“So the priorities will be programs that will help MSMEs like enabling training and accelerate further Negosyo Centers and shared-service facilities,” Lopez said.

In terms of the country’s international trade negotiations, the incoming DTI chief has likewise aired his full support at pursuing them.

“No change because I am all for fair trade and liberalization. Calibrated liberalization is the way to go, we cannot backtrack. We are part of the global system and if we backtrack, we will be out of that global system,” Lopez said.

“What we are going to do is work on how we can maximize these free trade agreements (FTA) so that it can benefit not only the existing (exporters), but even those who are not yet exporting. That not only the big firms will benefit but even the small ones,” he added.

The Philippines has started last month initial round of negotiations for an FTA with the 28-member European Union (EU).

The negotiations will aim to conclude a deal that covers a broad range of issues such as elimination of customs duties and other barriers to trade, services and investment, access to public procurement markets, and additional disciplines in the area of competition and protection of intellectual property rights.

In addition, the Philippines is hoping to join the Trans-Pacific Partnership, the 12-country economic bloc which currently accounts for more than a quarter of world trade.

“I think Mr. Lopez’ experience on the ground with MSMEs will really be a big boost to what DTI does, from ease of doing business all the way to international trade. His experience in capacity building of MSMEs is really the starting point. We have to simplify rules for businesses to benefit MSMEs, they have to be front and center. We negotiate trade agreements so they can import and export,” Cristobal said.

Prior to his appointment, Lopez has been the Philippine Center for Entrepreneurship-Go Negosyo’s executive director for the past 11 years and has served the business sector for 22 years.

Excelsior Worldwide Logistics Corp.