Freight Basics - Beginners Guide to Imports
In order to run a profitable import business you need to have the right people and processes in place. This guide explains some important points you need to consider as you start your import business.
Do your ResearchBefore arranging your first import shipment, doing your research is a must. Here are some of the key points you need to look into
- Products – you’ve found a need for a product or you can source parts cheaper offshore
- Suppliers – get to know potential suppliers, travel and visit, use the internet, go to trade shows, see who can provide the best product and who you can continue to do business with in the future
- Export Country – look into the countries you will be importing from, it could make a big difference to your end costs. Consider the distance to travel, the currency you will be charged in and any countries where we have Free Trade Agreements
- Production times and quantities – Factor in production time and minimum quantities per order
- Regulations – Look into the restrictions and regulations that affect the goods when they arrive into NZ. The Bio-Security website has a lot of information that can help
- Duties – depending on what you are importing and where you are importing the goods from will determine duty rate you will pay. The NZ Customs Website can give you an indication of what the rate will be and what it is based on
What to do nextYou have completed your research, now it’s time to get things moving.
- Find a reliable Freight Forwarder – make sure that their services meet your requirements - now and when your business has grown
- Customs Client Code – You can apply for this directly with New Zealand Customs or through your nominated Freight Forwarder
- GST registered – You will have to pay GST on all commercial imports, ensure that your company is GST registered
- MAF and Bio Security – You may require special Bio Security licences or permits in order to receive the goods you are importing i.e. Approved Transitional Facility (ATF) to receive full container loads into your store
Importing and the RisksImporting isn’t always smooth sailing. As a new importer some risks you may come across are:
- Compliance – Look into any restriction that may apply to your product. There are certain criteria that products need to meet before they are able to enter the country. Go to NZ Customs website for more information
- Currency Fluctuation – With the constant change in the economy. Make any allowances for sudden changes in exchange rates.
- Terms of Trade – be sure to have a clear outline of what is expected from you and from your supplier. Deadline, quantities, quality standards and shipping payment terms (INCO Terms) should all agreed upon before shipment gets underway