How to Start Your Own Import Export Business - The Complete Guide

Introduction?

India’s exports and imports have grown tremendously over the past few years. In April–February 2022–23, India’s overall exports are estimated to be USD 702.88 billion, representing a rise of 16.18% over the same period. Additionally, India’s overall imports are estimated to be USD 817.46 billion, showing a positive growth of 19.93% over the same period last year.?

Since the advent of eCommerce, India’s import and export industry has seen significant growth. Due to the tremendous growth of India’s exports and imports, many entrepreneurs want to start their own import and export businesses. Trade prospects with nations worldwide are more accessible than ever because of the global market’s ongoing expansion and the simplicity of communication and transportation.?

However, starting your own import-export business can be daunting and requires many formalities, especially if you are new to the industry. So, if you want to start your own import-export business, this guide will aid you along the way.?

?

Step-by-Step Guide to Start an Import-Export Business

The export and import business are itself a very broad concept, and a lot of preparations are required by an entrepreneur before starting the business. To start an export-import business, the following steps must be followed:?

1. Establishing an organization?

Before commencing an export-import business, entrepreneurs must choose their enterprise’s structure based on their ownership structure. They can establish a sole proprietorship business, an LLP (a limited liability partnership), a partnership business, a public limited company, or a private limited company.?

The next step is registering their new company and selecting a name for their legal business organization.?

2. Opening a bank account

Once you have registered your new company, the next step is to open a bank account to transact with vendors and customers. Entrepreneurs must open a bank account to carry out business dealings.?

However, depending on the kind of business entity, different documents are needed to open a current account with a nationalized or private bank.

3. Obtaining PAN?

After opening a current bank account, it is mandatory to have certain documents, including a PAN (Permanent Account Number), to start an export and import business. Every business entity registered must apply for a PAN card, and obtaining a PAN for a corporate entity is quite similar to requesting a PAN for an individual.

4. Obtaining an IEC (Importer-Exporter Code) number

Importer Exporter Code, or IEC, is a special 10-digit alphanumeric code assigned based on the PAN of a company and is mandatory in India to start an import or export business. No individual or company may import or export anything unless they have a valid IEC Code number until specifically exempted. The Government of India issues the IEC number.?

5. Get a registration and membership certificate (RCMC).

Getting an IEC number and a registration and membership certificate (RCMC) to get benefits from various schemes and assistance and becoming a certified exporter is essential. The Government of India established Export Promotion Councils (EPCs) to help Indian exporters grow their enterprises in international markets. Exporters can benefit from the numerous programs and support these authorities offer by using the registration and membership certificate (RCMC) supplied by these EPCs.?

6. Selection of products?

After completing the above steps, entrepreneurs must select the right product for export or import. Selecting the right product for the import and export business is crucial. Factors like regulations, the state of international markets, and export and import trends must be considered before selecting the products.?

7. Selection of markets?

Once the products are selected for the business, the next step is to select the right market for export and import. Entrepreneurs must ensure they select the right market for their business. Conduct preliminary research to see whether the domestic or global markets are experiencing demand for the items they are working with.?

The market must be selected after looking at factors like competition, market size, payment terms, quality requirements, trade barriers, political environment, etc.?

8. Finding buyers?

Finding buyers for your export or import product would be the next step in your business strategy after choosing the product and the market. Creating a website, attending trade shows and exhibitions, signing up on buyer-seller platforms, working with governmental organizations like export promotion councils, etc. are some ways to find buyers.?

Once all these steps are completed, your export/import business is ready to get operational.?

?Conclusion

To sum up, starting your own import-export company may be both challenging and lucrative. With this detailed guide, you may thoroughly understand the procedure required to make your endeavor a success. Always conduct extensive market research, develop long-lasting connections with vendors and clients, and be mindful of any applicable legal and logistical needs. Additionally, stay up to date with industry changes and stay one step ahead of the competition by keeping up with industry trends and having a flexible attitude.