How To Start Import/Export Business A to Z

A To Z About Import/Export Business In This article.

History of import/export Business

Know how the export-import trade came? You must have heard the name of Alexander, he was a king, he had taken a pledge of European countries that I have to rule the whole world.

In the world as many soldiers as possible, they did not have so much military force, so they started collecting information by intimidating people and killing those who did not come near it.

NOC :~ No objection certificate

In this way, he moved from one city to another and continued to carry people and his empire grew to like this. Alexander was the king of Greece, so you will see that on the map of Greece, to go further, you have to cross the river if he is like the whole world.

With such a simple army, how to go across it, a big vessel was made at that time and things were taken for drinking and eating in it.

Then people saw that with the help of the Vessel, we can carry a large number of goods. And India does 95% of its exports through the sea.

Nowadays we export products and services.


Minimum Investment to Start An Import Export Business?

history of import-export

What is an Import export in a legal sense?

  • Central Government Act
    • directorate general of foreign trade

Import and Export mean in relation to goods, bringing into, or taking out of. India any goods by land, sea or air.

NOTE- All schemes are not the same in India and other countries like the united states.

Import Export Business – What to Avoid

Initial Registration

  • Business Formation
  • Current Account
  • GST Registration click here
  • IEC Code
  • RCMC (Registration cum Membership Certi)
  • FIEO click here
  • Phyto Reg for Foods
  • Port Reg
  • LUT (latter of undertaking)
  • More(It is good if you work with CA)

Some Questions about company Registration

Que:-How to decide the company name?

Ans:- use this site and search the name that you have decided. If the name not taken by anyone, then select your company name.

Exporter types,EPCs & Customs


First, you have to decide which exporter you want to become: They all are under the government of India

  • Merchant Exporter- buying the goods from the market or from a manufacturer and then selling them to foreign buyers. They decided on the product price.
  • Manufacturer Exporter- Manufacturing the goods by himself for export
  • Sales Agent/Commission Agent/Indenting Agent- acting on behalf of the exporter and charging a commission for finding buyers/ foreign markets.
    • For e.a.- Let “A” represents manufacturing exporter i.e. he has his own manufacturing unit and produces and export a product “steel” now B is the sales agent and will find the Importer for steel, In this case, A will provide a commission to B, generally the rate of commission is 5%.
    • Remember “A” will carry out the entire export procedure. “B” will only find an importer. “B” can also become an agent of the company set up abroad and will help them to get probable exporter or importer as per the need. “B” can also become an agent of multiple companies.
  • Service Provider — provide service to needed one For e.g.- “C” wants to import an entire container of “Pen”, “C” has the money but he doesn’t know anything how to import, so he will contact service provider “S” now “S” will carry out import activity of “Pen” with his own IEC code and will unload the entire container at ‘C” desired place/ warehouse.
    • In this case, “C” will provide a commission to generally the rate of commission is 7 to 10% for a service provider.
    • The service provider will also provide the service to the firm setting abroad. They are called helpers in the field of EXIM trade
    • Suggestions: In this modern era sales agent and service provider has not got much of a future.
    • because in this day’s Exporter can easily find out Importer of his product, Exporter can place free ads with accurate description and images of the product in a website like generally importer find out his needed product for websites like these
    • In this modern era, the trade is becoming very simple so if a person like ‘C” who does not know anything will get to know a lot of knowledge if he read my book completely.
    • If you don’t have much money “Merchant Exporter Is the best-for you. Find the best product you love, do proper analysis & find its domestic supplier and buy from him then sell it abroad in your own brand name.
    • You will earn a lot for sure but make sure you choose only one product because it requires a lot of studies and proper documentation has to be carried out. The more you choose the more you will

Few IMP EXIM Terms

  • Custom House-
  • WCO-World Custom Organization
  • ICC-International Chamber of Commerce
  • WTO-World Trade Organization
  • LCD-Land Custom Station
  • ICD-Inland Container Depot
  • Ports
  • CFS-Container Fright Station

Incoterms(International Commercial Terms)only for international business

incoterms in Import-export business

NOTE:- Incoterms are only applying on exporters, and for overseas business.

  • Ex-works -exporter’s responsibility until his factory’s Gate.
    • In this Incoterms Exporter is the king, Exporter only produces goods on his premises it’s the duty of Importer to carry out all the formalities.
    • Importer either can physically collect the goods or could send his person or could hire some private agencies to bring the goods to form Exporter to his country. Flow nice for Exporter
  • FCA-(Free career)Exporter has makes goods available importer’s(if in India) factory or port or ICD(Inland container depot).
    • In FCA (Free Carrier) the Exporter just has to send goods at the desired place of Importer, a form that entire formality is carried out buy Importer.
    • Hear Importer can ask Exporter to provide help in custom clearance formalities. An exporter can provide help at the cost and risk of Importer.
  • FAS-(Free alongside shipment)Make goods available on the port.
    • free alongside shipment, as the name suggests; Exporter will send the goods in port It near the ship,
    • will not load in the ship, loading is done at the cost and risk of such kind of Incoterms can be used by exporter when the cargo is fragile in nature, could be easily damaging if more movement is done.
  • FOB-(free on board)Exporter’s cost and Risk until container load on a vessel.
    • In Flee on Board, the Exporter will pay transportation cost up to port & loading of goods be done at Exporters expense after that his responsibility ends; now it’s the buyer Leto take care of goods when ship start sailing.
    • Now if cargo is broken in transit it’s who has to suffer the loss.
  • CFR(C+FR/CF/CNF)C=FOB,Fr=freight >Delivery on Importer’s port,
    But Risk the same as FOB.
    • CFR- Cost and Freight are FOB + Freight, Fright expenses up to Importers port are paid by Exporter but rest all other matters are as similar as FOB.
  • CIF-(Codt+insurance+freight on exporter)But risk the same as the Fob.
    • Cost Insurance and freight are FOB + Freight + Insurance, Exporter pays the fright and –instance expanse, the responsibility of Exporter is the same as FOB.
    • After the ship starts sailing II and its cargo damages than it’s the duty of foreign countries Importer to call the Insurance Company.
  • DDP-(Delivery Duty paid) Delivery on imports doorstep (include all types of cost)
    • in delivery duty paid importer is the King, it’s totally opposite of “Exworks” Incoterms, in DDP entire procedure and Risk out by the Exporter and seller provide goods at the premises of the importers How nice for importer
  • DDU-{Delivery Duty Unpaid} also a duty under the importer
    • in Delivery Duty Unpaid entire procedure is carried out at the risk and cost of Exporter,’ only import duty is paid by Importer in DDU.

Mode Of Payments:- For exporting transaction in international trade

payment terms in import export
  • Advance Payment-100% Advance TT against proforma invoice/quotation=
    • Advance payment [Most Important for courier export/import] In this mode of payment, Exporter will get advance payment for executing the order by the Importer.
    • Importer deposits the specified amount in Invoice to the bank of the exporter. Exporter provides basic bank details to Importer to deposit amount. Nowadays is also used by many traders to transfer the amount.
  • Open A/C- For Only Relatives, friend or family
    • this mode of payment, payment terms and conditions are not fixed as both are buying from each other.
  • D/P-Document against payment by bank
    • In this mode of payment, the exporter will get instant payment as soon as he submits the documentation to Importer. It is generally called D/P at sight.
    • There might be a possibility that Importer might not get his container/cargo but still, he has to make payment once documents are sent to Importer.
  • D/A-Document Against Acceptensens in decided days
    • The entire payment procedure of this D/A is similar to D/P, but he will get documents before payment to clear his cargo.
    • There is a usance period (credit period) attached in this mode, The importer will pay after 30,60 or 90 days as pre-decided by exporter or Importer.
    • A bank is intermediately and the bill of exchange has to be signed by Importer, it’s the commitment to pay to the exporter at a fixed date.
    • While in D/P mode of payment, the bank will not provide documents to Importer unless he makes payment. So Importer would not be able to clear his cargo without paying.
  • L/C -Letter of Credit
    • This is the most secured mode of payment If Exporter or Importer does not trust each other_
    • -Er still want to carry out trade than this mode of mode is to be utilized “L/C is also called documentary credit,
    • the payment procedure is done via D/P or D/A mode only, but If Importer fails to pay money than a bank will provide it to an exporter.
    • In a nutshell, the exporter gets a guarantee from Importer’s bank that he is going to receive his money.
  • Escrow-for Alibaba
  • Barter Trade-Goods To Goods


import export containerization

Types of Container

  1. Dry 20 ft or 40 ft
  2. Refrigerated
  3. Tank for Liquide
  4. Open top
  5. ULD(Unit load device) 1200 KG

FCL-Full Container Loaded

LCL -Less Container loaded

Import Duty

  • Basic Custom Duty
  • Social Welfare Surcharge{sws}@10%
  • Integrated GST (IGST)
  • Compensation

Some General Questions

Q. If Exporter pays all Fright or Insurance expense then it would be a loss for exporter?

Q. How to recognize that Exporter has shipped the goods properly?

Q. What work does CHA do for Exporter?

Q. What are Customs??? Who prepares customs tariffs???

What Is Bill Of Lading(BL) In Import Export Business?

How To Get Export Incentive From Government?

Import duty is always calculated on CIF Value



Freight 20% = 1 Lac

Insurance 1.25% =7650

“606750= CIF”

Calculation By Example

  1. Basic Custom Duty[BCD]=10%
  2. Social Welfare Surcharge[SWS]=10% of BCD
  3. IGST =18%

Suppose 100 CIF


SWS10% on BCD=1/111

IGST 18%=19.98/130.98

For more info and calculate online

Online Researching Sites

Product Search Click Here

Product Trade Info Click Here

Know Import/Export Duty Click Here

Port To Port Days Click Here

All About Import Export Code (IEC Code)A-To-Z

What is STAR Export House Certificate

Modules of Exports

  • CounterTrade
  • Off Share Trading
  • Deemed Exports
  • Sale on Consignment Basis
  • High Sea Sell
  • String Sale
  • Service Export
  • Project Export
  • RE-Export
  • RE-Import

Statics Documents

  1. Biz Reg
  2. IEC
  3. GST
  4. RCMC
  7. LUT
  8. Factory stuffing Certi

Regular Documents

  1. Invoice
  2. Packing list
  3. EVD[Export value declaration]
  4. Bond/Bank guarantee
  5. LUT
  6. LEO[Let Export Order]
  7. Insurance Know more
  8. B/L [Bill of Lading]
  9. S/B[Shipping Bill]

How to calculate the cost for FCL

How to calculate the cost for FCL
  • Procurement cost
  • Packaging Cost
  • CHA(Documentation charges)
  • Domestic labor and transportation charges
  • Terminal handling charges
  • Container freight charges
  • B/L charges
  • Port to port transfer charges
  • Insurance premium

Explanation Of HSN Code

Final Steps

  • Creation of the company
  • Open current a/c in a bank
  • Get IEC code
  • RCMC – APEDA For Agri
  • Meeting with CHA
  • Port REG
  • Phyto REG
  • Tentative Freight Rate
  • Meeting with the supplier and ask

Find genuine buyer from Trade show for starting export-import Business

Start an export-import business for comprehensive economic.
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