When you next fly to Australia, Dubai or Japan and you spot a jar of my Emi & Ben body butter on the shelves of one of their retailers, you’ll be experiencing international trade. For many businesses like mine, international trade allows brands to expand in markets not easily available to them. Nineteen months into my natural skin care business, I got the urge to dip my toe into international waters to tackle one of my key aims – going global. It’s an area I had a small amount of awareness of, however, that’s the beauty of research – it provides you with the knowledge to conquer whatever is next on your list.
This month, the Flavour business page takes you through a checklist of things you will need to know if you wish to take your product or service around the world.
1. Legal requirements
Whether importing or exporting your goods and services, both processes can be complex. As an importer of pure shea butter, there was a long list of things I needed to have in place prior to arranging the first delivery from Nigeria to the UK. One was having a trade licence issued by HMRC. This legally gives me the right to move goods from one country to the other; without it I would not be able to import the main ingredient for my business.
Another requirement is whether the goods you’re importing will comply with UK legislation, and more importantly, who will make the customs declaration for you. For my first delivery of Shea butter I hired a customs clearing agent (also known as a freight forwarder) to take care of the responsibilities involved in transporting my goods. Employing an agent can also provide services in areas such as customs clearance, export documentation and insurance, with further services including distribution and warehousing.
2. Moving your goods
When importing shea butter directly from Nigeria I decided to transport it by freight. While freight is my company’s preferred method, as a business owner you could also consider transporting goods by ship, rail and road.
There are additional factors you may need to reflect on, including the volume of goods or materials to be imported; this could affect your transport method of choice. Also, if like Emi & Ben the goods are part of a production process, you’ll need to consider timings.
3. Tax obligations
“Understanding import duty and associated taxes is essential to making international trade commercially viable,” says Business Link. It’s not rocket science, right? Yet I’m sure many businesses fail to follow this simple and essential rule. Arm yourself with information on tax obligations for the import or export of your goods; not knowing may result in a costly fine.
4. Your sector
Whether you are in service, manufactured goods, food and agriculture, or natural resources and chemicals, each sector has individual regulations that need to be adhered to. Documentation including certificates may be required; however, if you’re not proactively sourcing information, how would you know? With each area are individual sections with further subdivisions, so it’s imperative to know the zone your business falls in. With the right preparation, you’ll keep undesired fines and stress at bay.
Over the years the media has reported that some UK businesses have missed out on international trade opportunities due to a lack of understanding of how to operate in a foreign market. According to government research, international trade should be a natural step when looking to reach new customers, yet some have allowed over-cautiousness prevent the move forward. If you are scared about taking the international plunge, collect your thoughts, research and seek advice from experienced business owners who have already taken steps; it may be the best thing you’ve ever done.
Ronke Ige: founder of Bread + Butter PR, and Emi & Ben skin care; Prince’s Trust and Enterprise UK ambassador, working to inspire young people to be enterprising
Words by Ronke Ige, Photography: Black 100 +