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This comprehensive guidebook will help anyone conduct international business by showing the ins and outs of importing and exporting, shipping, insurance, banks, currency exchange, contracts, customs, and transportation. This guide also covers the impact of NAFTA, the European Economic Community treaty, and political changes in Russia and other Eastern European countries. Includes over 100 samples of essential documents with easy, step-by-step instructions.
Organizing for Export and
Smooth, efficient, and compliance-oriented (and, therefore a profitable) exporting or importing requires that certain personnel must have specialized knowledge. The personnel involved and their organization vary from company to company, and sometimes the same personnel have roles in both exporting and importing. In small companies, one person may perform all of the relevant functions, while in large companies or companies with a large amount of exports or imports, the number of personnel may be large.
In addition, as a company decides to perform in-house the work that it previously contracted with outside companies (such as customs brokers, freight forwarders, consultants a packing companies, and others) to perform, the export/import department may grow. As business increases a specialties may develop within the department, and the duties performed by any one person may become narrower.
A. Export Department
For many companies, the export department begins in the sales or marketing department. That department may develop leads or identify customers located in other countries. Inquiries or orders may come from potential customers through the company’s web site where the destination is not identified. When such orders come in, the salespeople need to determine what steps are different from its domestic sales in order to fill those export orders. Often the exporter’s first foreign sales are to
Canada or Mexico. Because the export order may require special procedures in manufacturing, credit checking a insuring, packing, shipping, and collection, it is likely that a number of people within the company will have input on the appropriate way to fill the order. As export orders increase (for example, as a result of an overseas distributor having been appointed or through an expansion of Internet sales), the handling of such orders should become more routine and the assignment of the special procedures related to an export sale should be given to specific personnel. It will be necessary to interface with freight forwarders, couriers, banks, packing companies, steamship lines, airlines, translators, government agencies, domestic transportation companies, and attorneys. Because most manufacturers have personnel who must interface with domestic transportation companies (traffic or logistics department), often additional personnel will be assigned to that department to manage export shipments and interface with other outside services. Some of this interface, such as with packing companies and steamship lines, and possibly government agencies and banks, may be handled by a freight forwarder. The number of personnel needed and the assignment of responsibilities depend upon the size of the company and the volume of exports involved.
A chart for a company with a large export department is shown in Figure 1–1. The way in which an export order is processed at the time of quotation, order entry, shipment a and collection is shown in Figures 1–2, 1–3, 1–4, and 1–5 a respectively. Smaller companies will combine some of these functions into tasks for one or more persons.
B. Import Department
A manufacturer’s import department often grows out of the purchasing department, whose personnel have been assigned the responsibility of procuring raw materials or components for the manufacturing process. For importers or trading companies that deal in finished goods, the import department may begin as the result of being appointed as the U.S. distributor for a foreign manufacturer or from purchasing a product produced by a foreign manufacturer that has U.S. sales potential. Because foreign manufacturers often sell their products ex-factory or
FOB plant, a U.S. company that intends to import such products must familiarize itself with ocean shipping a insurance, U.S. Customs clearance, and other procedural matters. Increasingly, a number of U.S. manufacturers are moving their manufacturing operations overseas to cheaper labor regions and importing products they formerly manufactured in the United States. That activity will also put them in contact with foreign freight forwarders, U.S. customs brokers, banks, the U.S.
Customs and Border Protection, marine insurance companies, and other service companies.
C. Combined Export and Import Departments
In many companies, some or all of the functions of the export and import departments are combined in some way.
In smaller companies, where the volume of exports or imports does not justify more personnel, one or two persons may have responsibility for both export and import procedures and documentation. As companies grow larger or the volume of export/import business increases, these functions tend to be separated more into export departments and import departments. However, because both departments may end up being in contact with some of the same outside parties (such as banks, those freight forwarders that are also customs brokers, or domestic transportation companies), some of these activities may be consolidated in specific persons for both export and import, while other personnel will work exclusively on exports or on imports. A diagram of the interrelationships between the export and import personnel in the company and outside service providers is shown in
|List of Figures|
|Pt. I||Organizing for Export and Import Operations||1|
|Ch. 1||Organizing for Export and Import Operations||3|
|Pt. II||Exporting: Procedures and Documentation||15|
|Ch. 2||Exporting: Preliminary Considerations||17|
|Ch. 3||Exporting: Sales Documentation||60|
|Ch. 4||Exporting: Other Export Documentation||114|
|Ch. 5||Export Controls and Licenses||197|
|Pt. III||Importing: Procedures and Documentation||237|
|Ch. 6||Importing: Preliminary Considerations||239|
|Ch. 7||Importing: Purchase Documentation||280|
|Ch. 8||Import Process and Documentation||305|
|Pt. IV||Specialized Exporting and Importing||373|
|Ch. 9||Specialized Exporting and Importing||375|
|App. A||Government Agencies and Export Assistance||391|
|App. B||International Sales Agreement (Export)||409|
|App. C||Correct Way to Complete the Shipper's Export Declaration||417|
|App. D||Automated Export System (AES) and AES Direct||437|
|App. E||U.S. Customs Reasonable Care Checklists||455|
|App. F||Harmonized Tariff Schedules (Excerpts)||465|
|App. G||International Purchase Agreement (Import)||483|
|App. H||Rules for Completing an Entry Summary||491|
|App. I||Rules for Constructing Manufacturer/Shipper Identification Code||525|
|App. J||Customs Audit Questionnaires||533|
|App. K||List of Export/Import-Related Web Sites||541|
|Glossary of International Trade Terms||547|
|About the Author||583|