Typical Import Process

TYPICAL IMPORT TRANSACTION

Step 1 – Once a product is selected, the importer writes to overseas suppliers to send price lists and product catalogues.

Step 2 – Upon receipt of the price lists and catalogues, the importer then shows the catalogues to potential customers without disclosing the supplier’s name and address.

Step 3 – If there is a favorable response from potential customers, the importer contacts the overseas supplier to request for product samples and pays for its shipment by air.  In the meantime, importer checks with Customs for the applicable duty and other import requirements for the product.

Step 4 – Suppose the product sample received is found acceptable by importer, the importer then orders for a trial shipment by air and makes an advance payment to the supplier.  Importer should communicate domestic marking, labeling and other requirements to overseas supplier.  Supplier’s credit references can be obtained from the supplier, banks and the U.S. Department of Commerce. Potential customers are approached to place orders for the product.

Step 5 – As the goods arrive at the airport, importer arranges with a customs broker to clear customs.  The importer sets the selling price.

Step 6 – If the trial shipment sells easily, the importer orders large shipments by sea freight and prepares a formal price list and product catalogue.

IMPORT PRICING: EXAMPLE

Cost of Goods per item (imports from China)
Quantity
Local agent’s fee
Cost of Goods
Local agent’s fee
Container cost
Freight to destination
Insurance
Destination agent fees
Land transport
Customs duty (2%)
Port tax (1%)
Total Landed cost
Landed cost per item
Suggested selling price