If you are also one of them who wish to start their own import and export business, then you need funds in order to start a new business. The minimum cost to start can be around 3,50,000 rupees to 17,00,000 rupees talking about maximum for an import/export business. But in India, you can start your own business in very less amount. It takes only 250/- for IEC code and for your own export firm approximately 15k is needed. Here are some things which can give you an idea about the cost of an import/export business.
If you have sufficient space at your home, then you can start out as home-based, the benefits of starting home-based are you don’t have to lease a property or give any rents to anyone, you can save a huge amount of money by going home-based. Also, it will also help you in saving your money on inventory, infrastructure, Home furniture and also at some point you will save the salary of employees as well.
The most basic things that you are gonna need will be a laptop, printer, fax machine. Once you have all these things in hand you are ready. Everyone starts from scratch i.e from zero but all it takes to take your business to a peak is one big opportunity, once you get that opportunity you will eventually reach heights.
Some few types of equipment will be required by you also to have a proper system to start a business. Like a wifi connection, printer, scanner, software, travel expenses because starting a business requires a lot of research. If you already have this then you are all set.
2. Help Others and You Will be Helped
“Well, one needs a great amount of patience and persistence – competition is extremely high. Getting to know what is going around you helps to remain updated and also helps in strengthening buyer-seller relation. Also, to gain export orders, manufacturers and suppliers need to consciously focus on quality improvements” Vipul Shah, CEO CottonTex.
When you are running a business in a market where you have competitors who are also selling the same product that of yours then you need to remain in harmony with everyone. Also, sharing and helping others will help you tomorrow in case of emergency. Remaining updated with everyone will also help you in knowing where you stand in the market.
3. Understanding the price and cost of products
When going for business internationally you need to be thorough with the foreign exchange rate, understanding inflation fluctuations, and the applied laws and regulations both in your local and foreign trader. Also keeping track of market, competition and potential clients.
Being an exporter is not easy and when you want to export any product then pricing of the product becomes a really important factor so it should be done carefully and accurately. Because at the right price only exporter and importer can finalize the limit of sales. The two types of approaches used in importing/exporting are:
Cost Plus Approach: This method is based on a calculation of the cost of goods sold(COGS) of the product also includes calculating selling.general and administrative(SG&A) expenses of the products. While exporting it is important to keep in mind that additional costs in exporting are covered equally with all the other expenses.
Marginal Approach: Some exporters might use the marginal cost approach when it comes to pricing the elements of exporting. The company which already making a profit out of it’s local/domestic market creates a plan to carry out the additional expense of SG&A from domestic profits or sales.
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