Running and completing a successful crowdfunding campaign requires creativity, dedication and maybe even a bit of luck. Importing your products should not.
Check out to the guest blog post we did for Fulfillrite below:
Although the logistics and customs clearance process can seem like a bit of a black box, the actual process is pretty simple. We’ve included a few tips below to shed some light on the process for those of you that are new to the importing process.
1) Select the Best Supplier
Finding the right manufacturer is key step #1 that may require some homework. You want quality, reliability and communication – cheaper does not always mean better. It pays to shop around in order to identify which partner will be by your side when you need to meet a last-minute production deadline.
Tips on locking down the right one:
- Research manufacturers of your products around the world via portals such as Alibaba and Global Sources
- Check out your competitors’ suppliers on ImportGenius.com
- Attend an international trade show for the opportunity to meet potential suppliers face to face
- But before you start your campaign, make sure the product you are importing is actually allowed into the U.S. and complies with all U.S. regulations (the legal stuff can get a bit boring, but we included some tips in section #6 below)
2) Plan to Plan Ahead
Shipping goods internationally takes time. Until the driverless hyperloop is complete, your primary options for moving products will be Ocean or Air.
In terms of timeline:
- Ocean Shipments: Estimate about one month from the time your goods leave your supplier to arrival at your warehouse in the US.
- Air Shipments: Estimate approximately one week for air shipments, but keep in mind air freight is significantly more expensive (sometimes up to 3x the cost of ocean shipments).
3) Don’t Navigate the Import Process Alone
Demystifying the import/export business can be overwhelmingly difficult. While big companies have dedicated teams with the luxury of direct relationships with major carriers, small and medium sized businesses will usually book through agents. These middlemen are notorious for poor service and price discrimination, offering far better rates to clients with bigger shipping volumes.
Get a customs broker and freight forwarder on your team during the early planning stages – you can find great ones at NCBFAA.org. Don’t wait until your first shipment is ready to move. These companies have a wealth of information that will help you avoid the most common pitfalls experienced by budding global companies.
In addition, a reputable freight forwarder will help you negotiate the best rates and manage the importing process for factory to final destination. They will make sure all documents are in check and keep tabs on the status of your shipment.
Some key documents you’ll hear about include:
- Commercial Invoice – Issued by your supplier confirming the quantity and price of your goods
- Airway Bill / Bill of Lading – Issued by your freight carrier confirming the title and movement of the goods
4) Be Nice to Your Customs Broker
Clearing your shipment through U.S. Customs can also turn into a headache without proper guidance. Depending on what product you are importing and from which country, there are 120 different forms that may need to be filed with more than 10 different government agencies. And the legal responsibility for complying with these regulations lies with the importer (aka you).
We recommend using an experienced customs broker to help ensure compliance with all the various laws (and assist with paperwork!). A strong customs broker will make sure your goods are properly classified and all the right forms are filled out on your behalf. Oftentimes brokers and freight forwarders are one in the same or close partners.
5) Factor Import Costs In Your Estimated Product Costs
There’s a real cost to moving a container to the other side of the world. In addition to the costs of manufacturing your product, don’t forget to include freight, customs and insurance when calculating the total costs of goods.
Painting an accurate picture of your total product costs is crucial in determining your product margin (and your profitability!). Working with a great forwarder and customs broker is invaluable in figuring out your landed cost.
6) Don’t Forget About the Legal Stuff
Like we mentioned above, you’ll want to make sure the product you are importing is actually allowed into the U.S. Certain items, such as furs and ivory, rare or protected goods and pirated designer products may have restrictions imposed on them at the country of origin.
And when importing electronics and some of the great new hardware devices, it’s important to understand there are extra rules around products that contain batteries. Batteries are classified as “Dangerous Goods” and must be shipped adhering to strict regulations. This means you’ll want to make sure:
- Your supplier has an export license and are willing to declare themselves on all necessary documents
- Your supplier has all updated documents (like a MSDS and Drop Test Report
But don’t fret too much about the legal stuff – your freight forwarder or customs broker can help you make sure that you comply with all the regulations. Which is why you want them involved early, rather than discovering a potential show-stopping issue once cargo arrives at the port.
Assuming you made it through all the tips above, you are now well-prepared to begin the process of importing your goods after your successful crowdfunding campaign!