What are stakeholders in export business?
We bring you another interesting topic today. If you are someone who is interested in learning what other players are involved in export and what is the process of doing export. You need to read this blog till the end.
This blog will advance you a step ahead and you will explore the characters associated with the process of export that you must know.
We have been exporting many products and mainly construction equipment products from India across the world since 2014 and we have gained much valuable information and learning by doing the export. We will share those practical scenarios here with you.
There are two methods of learning.
1- Conventional Method
Business Schools and colleges provide their students the theoretical knowledge that is not much of use in the practical world.
You may have a lot of knowledge but you find your knowledge not solving the real issues you may face while working.
A person who went to the conventional college is surprised to know that there is very minimal relation of his knowledge with the practical work.
Degrees will make your profile to be known among people but it will not help you out much in your practical job.
Yes degrees will be of much use in getting a job in an organization but it will have a very minimal impact on your entrepreneurship.
What will impact you the most when you come to the world of doing export, let us discuss.
2- Experimental knowledge
In this, there is also two method
i- Learn from your owned experience
ii- Learn the best practices from someone’s previous experiences
Learn from your owned experience
associated with it and take decisions. There is a famous saying. Practice makes perfect.
Learn the best practices from someone’s previous experiences
The other method of learning is to learn from those who have already invested a lot of money and time to acquire such practical knowledge.
This will save your money and time and you would be able to gain the same knowledge as the experienced guy has acquired from ages by making a lot of investments and time at a nominal cost within a short period of time.
You can avoid all those mistakes done by the experienced guy in their time and you can utilize your money and time effectively and efficiently to maximize your work.
In this age, this kind of learning is most recommended as you need to progress in limited time to achieve success since speed matters a lot.
Just I am asking a very simple question.
The closure of the deal with the buyer for export of your goods is the end process or do you need more things to complete this?
Closing the deal is the primary and essential but you need a lot of things yet to complete your task that plays a very vital role.
What those things that you require are called stakeholders that are numerated below.
1- Logistics
2- Ports
3- Freight forwarder
4- Insurance
5- Banks
6- Custom clearance
Logistics
As soon as you conclude the deal, you need to hire a logistic company that will take your goods to the port. Being an efficient exporter, you need to hire the best logistic company that will have previous experience to handle the type of products you deal at the best rate with efficiency.
Ports for export
Port is a key place where all the necessary examinations and documentations are done.
Ports are of three types
Sea Port
If the goods are in bulk and heavy weight, you are recommended to send only by sea. Shipping by sea will also charge you less compared to other mode
Air port
Shipping by air is useful only for low weight cargo or low volume cargo or the buyer is in hurry to get the products since the freight of the air cargo is very high
Dry Port
Dry ports also known as inland ports connect with the sea port. Dry Ports are made where the sea is not available nearby the places.
If the goods to be shipped from a place that has no sea port needs to use the dry ports to get the custom clearance and other documentation then they are sent by road to the sea port from where the goods are shipped.
Freight Forwarder
Freight forwarders are responsible to facilitate in getting your goods from your place to the buyer place. Based on the Incoterms, the freight forwarder arranges the delivery of the goods on board to ship or at the buyer’s port or at the buyer’s wearhouse. It all depends on the agreement between the buyer and the seller for delivery.
It is worth mentioning that freight forwarders coordinate with shipping lines to provide this facility to you.
There are various shipping lines in the world to carry cargo from the loading port to the discharge through various routes. There are different charges of different shipping lines. One shipping line charges high although the other one charges low for the same cargo. You as the exporter is the ultimate payer of those charges. You may pay a higher price and the other one may pay the lower price for the similar cargo and it all depends on your freight forwarder how smart the freight forwarder is. You cannot find such deep information anywhere until or unless you will have good experience in exporting.
Insurance
Insurance is mandatory in the export and it covers the risk associated with the shipment of goods damage or any loss. This type of insurance is known as Export-Import Cargo (Marine) Insurance that covers many risks depending on the policy of insurance.
The insurance can be purchased by the exporter or the importer as per their agreement.
Banks
Bank has a key role in the export business and it facilitates you to collect your payments agreed between the exporter and importer. The payment can be the advance payment, Letter of credit or credit.
The payment terms again are a different subject to be discussed and we will explain all in another blog.
Custom clearance
This is a very important thing in the entire process of exporting. The goods can be only shipped to the buyer, once the clearance from the customs department is received at the loading port and exported goods can be released at the buyer’s port when the custom clearance of that goods is obtained at the discharge port.
Hence the customs clearance is done from the loading port as well as the discharge port.
The custom clearance for you as an exporter has much importance at the loading port and the customer clearance for the importer has an importance at the discharge port.
You need to be careful on this part lot since a small negligence will get you in trouble if the clearance from the custom is denied then you are not able to ship your goods or get released from the discharge port.
You do not need to worry on this part since all these things can be taken care off by your CHA.
Just you need to hire the experienced and smart CHA to handle the customs.
These things will give you a tremendous experience and a lot of learning. Be careful when you hire these guys to get your export done.
Conclusion
The stakeholders are a very crucial part in the process of export. All the export works are carried out by these stakeholders while you are sitting at home but you need to hire smart and experienced guys or companies to get your work completed. If you make any mistake in hiring any chain of these stakeholders that are supposed to get your export job done smartly, you will be in a fuss and will face a lot of issues.
Hiring a right guy or company for your export work will ease your life and will attract your buyers the most and this will add more byers in your list.
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