Importation can be an immensely lucrative undertaking when done right; this is why it’s crucial for individuals looking to venture into importation to have as much information as possible regarding the process as it’s procedural. It pays to note and understand every stage of the process. From finding a supplier, hiring shipping agents, to engaging a site offering a U.S. address for Canadians, you have to stay on top of things to maximize your profits. Brace yourself for the 11 things that you need to know as a novice importer:
Importation of goods has its complexities, and choosing a product supplier that you can trust will go a long way in ensuring your business prospers. Communicate with your potential supplier through chat, in person, or by email or phone. The right supplier will simplify the importation process because they will ensure you receive your goods on time and at a cheaper rate.
Customs agents can help Canadian importers with the technicalities of the import documentation systems. A customs broker will come in handy since they will act as your business agent to help you with customs clearance and transaction of business. It is, however, crucial to note that you are solely responsible for the payment of duties, taxes, and levies, re-determination of valuation, origin, classification, accounting, and documentation even when using the services of a broker.
Application for a license will be necessary depending on the products you wish to import. You need to be familiar with the rules governing what you’re importing. Canada has import requirements for various products, such as agricultural supplies. They also have restrictions on particular products, for example, some grain exports from the US. You should employ the expertise of customs brokers to mitigate unnecessary risks and costs that may arise from missing critical regulations.
Conduct a comprehensive market study to ensure that your products have a place in the market. The best imports are bound to satisfy a demand that the native market does not fulfill. They can be classified as cheaper, excellent, and unique compared to their local counterparts. It is vital to examine your target market and craft an ad strategy that targets your chosen demographic.
While it could be tough and challenging to determine which type of international insurance your import company needs, it should not be understated because insurance helps you mitigate different kinds of risks. The availability of insurance prevents you from being held accountable for unpredictable liabilities such as;
There are various options on how you can handle your inventory. For instance, you can retain goods in a bonded warehouse; it would benefit you by storing goods and duty deferral. Moreover, it can also keep your items in a foreign trade zone (FTZ), allowing you to prevent tax payments on your goods while delaying duty payments on your items.
The paperwork you’ll have to fill in when you are importing goods for the first time can give you a migraine. It typically involves dealing with multiple government agencies, making the process complicated when importing goods into Canada. A minor omission or documentation mistake would mean prosecution for customs fraud. The easiest way to deal with this is to hire a licensed and qualified customs broker to simplify the process for you.
Ensure that you have a steady cash flow since import businesses usually encounter lengthy logistics, distribution, and packaging processes before receiving income from sales. Conduct a forecast of your cash flow levels before you begin and explore ways of keeping your cash levels through channels like business loans.
Perform a thorough check with your supplier to ensure they know the standards required for labeling goods imported into Canada. Standard labeling must have three fundamental compulsory statements appearing in a predefined sequence where relevant, that is;
You could be comfortable drafting your release, accounting documentation, and conducting business without a customs agency. However, using the services of a licensed customs broker will ease this process for you since they will make sure that your goods are compliant with import regulations and laws aside from having the necessary paperwork.
Assess whether it would be cost-effective to outsource the services of a freight forwarder or handle them by yourself, depending on the complexity and volume of your transportation needs.
When you think about logistics, visualize who caters for extra costs during the whole importation process.