Posts Tagged: Cost Cutting Tips
No matter if you are importing and exporting via land, sea or air, you are bound to be looking for ways to cut down on operational and administration costs at some point in your company’s lifetime. The trade business is an intricate system entailing numerous legal and logistical rules and regulations, with each task and rule labelled with a price tag to ensure all the requirements are met and your goods secured.
Decreasing expenses and increasing revenue is the main goal of every commercial business, so here are the best ways you can cut import and export costs to ensure bigger financial savings and calculate long-term business growth.
Cutting import costs
First, you’ll need to invest time into confirming your HS codes, issued by the World Customs Organization (WCO) before importing. Customs classifications are intricate and detailed, and more likely than not, the code provided by the supplier won’t match the classification system in your country. This could lead to unnecessary financial expenses. Bear in mind that you will only be able to know the full cost of imported goods with a correct HS code.
Secondly, you should factor potential shipment checks into your equation when calculating your transit expenses. Your shipment might be scheduled for examination or it can be selected at random, but in any case, you need to be prepared for five to seven days of delay. In case you are transporting time-sensitive goods, you should use air shipping as your preferred method that will allow for long-term financial savings.
Finally, you want to make sure your import forwarder or broker is thoroughly aware of all ocean imports before the shipment sets sail. The importer must fill in all the necessary documentation correctly and ahead of time as failing to provide importer documentation will elicit substantial fines reaching thousands of dollars.
Cutting export costs
When trying to cut export costs, you first need to know and thoroughly understand your Incoterms issued by the International Chamber of Commerce (ICC) that relate to international commercial laws and regulations. Failing to understand the intricacies of your Incoterms will facilitate misunderstanding between parties and you can end up running into unexpected fees or paying more than you have previously concluded.
Next, you need to secure the best shipment deals possible. The costs of returning empty shipping containers are too high, and you are better off buying new ones for every shipment. That is why you should minimize your shipping container expenses and buy those that offer the best quality/price ratio. Luckily enough, today you can find a wide variety of new and used containers according to your needs and your budget.
Thirdly, do market research. Venturing into a new, unfamiliar market can be quite a daunting and expensive task, but if you manage to attain some valuable market insights before stepping into the competitive arena, you can alleviate some of the financial and logistical pressure. Be sure to research local currency and tax systems, and be on the lookout for their added-value-tax system as well. Moreover, don’t forget to research local businesses and social cultures in order to establish a trusting business relationship with your partners.
Finally, do your paperwork. Research the necessary paperwork for your shipment thoroughly to make sure it passes the customs inspection process with flying colours and reaches its destination. Different markets require different legalisations, stamping and original or copied documents, all of which can vary depending on the country, region and commodity you are selling.
Efficient warehousing operations are vital for both the import and export segment of your business venture. With this in mind, you should implement contemporary materials handling techniques, such as using heavy-duty, adaptable pallet racks and paperless technologies. When it comes to constructing the warehouse, you should consider contemporary cost-effective building materials, such as the structural steel solutions by Wallandra, for instance.
The international trade business can be a costly venture, yet if you follow these simple guidelines, you will have no problems cutting down on unnecessary expenses and thus calculating your way to long-term success and solvency.