Did you know that less than 1% of American businesses export their products? That’s an extremely low number, especially when you think about the fact that there are billions of companies in the country!
However, what that means for you is that you can start earning some serious cash by starting an import-export business. That’s because you can export products that other businesses don’t want to!
If you’re ready to get started learning how to start your own import-export business, this guide is for you. Let’s take a look at what you need to know.
1. Launch Your Business
The first step to starting an import-export business is to open the company. You’ll need to first pick a business name and check that there are no other companies with that title in your State.
Then, register your business with your Department of State. You can typically fill out an application online and submit it along with your filing fee pretty easily.
Next, make sure that you don’t need a registered agent or any other services. Your registered agent will help you handle legal paperwork as part of your business formation.
After you’ve filed your paperwork and been granted your business license, you’ll want to register for an EIN. You can do this on the IRS website.
If you need help with the legalities, you can hire a team to help you iron out the details. They’ll make sure that you’re setting up your business correctly and that you’re doing so lawfully.
2. Choose the Products You’ll Import and Export
Once your company is up and running it’s time to think about what products you want to import and export. A good rule of thumb is to find a product that you love but that will also net you a good profit.
When choosing your products, you should also think about how you’ll stand out from your competitors. Look into other businesses that are importing and exporting the same products as you and think about ways to differentiate yourself.
If you’re unsure of where to start for this type of research, try checking out the International Trade Administration or the Market Potential Index. These organizations can give you key information about the competition and your business.
3. Select Your Vendors
With your import and export products chosen, you’ll need to pick your vendors. There are tons of different vendors out there and many ways to go about finding one.
If you already have a relationship with a local business, you can approach them personally. This method also works if you’re interested in exporting and importing from a specific organization.
Another place you can look for vendors is on Alibaba or Global Sources. These sites will give you pricing information and help you figure out your profit margins as well as hook you up with vendors.
4. Set Your Pricing
One of the most important things to keep in mind when launching an import and export business is your pricing. You’ll need to set a price that’s high enough for you to make a profit but low enough that people will buy it.
To set your prices, think about the profit margin on each unit you sell. You should also think about the volume of the sales you’ll be making. From there, you can determine a markup that makes sense for your particular item.
To help give you an idea of what your markup should look like, most import and export companies have markups of about 10% to 15%. Even though the markup isn’t huge, it’s still enough for them to make a profit.
5. Find Your Clients
Next, you’ll need to find a way to connect with your clients. You’ll want to use several different marketing techniques to connect with clients through a variety of channels.
One great way to get started finding clients is to create a website. Then, you can either use SEO services or PPC to help bring clients to your website.
You can also consider using cold calling, newspaper ads, social media ads, and billboard marketing to find your clients. Generally, a mix of different channels is a good way to get in touch with potential buyers.
6. Work Out the Logistics
Next, you’ll need to think about the logistics of your new import and export business. Generally, you have two options:
- Dropshipping
- Using freight forwarders
Let’s take a closer look at each of these options.
Freight Forwarders
Freight forwarders are middlemen who deal with suppliers and governments on your behalf. They’re great for those who don’t want to deal with the complications of importing and exporting goods themselves.
Dropshipping
Dropshipping is when you don’t keep items in stock ahead of time. Then, when you sell a product, you order it from a third-party business that sends the item to your customers.
7. Make a Business Plan
The last step to starting your own import and export business is to create a business plan. Your business plan will lay out how you’ll create, organize, and operate your company.
If you need to get funding for your business, this roadmap becomes even more important. That’s because most lenders require you to have a business plan before they’ll approve your loan application.
Launch an Import-Export Business Today
With this guide on launching your own import-export business, you’ll have no problem joining the world of global trade. It’s a great way to start making some money and creating a successful business!
Did you love this guide to starting an importing and exporting business? Be sure to check out some of our other articles to learn even more about international business.