Export Procedure

Export means an activity in which you produce in your own country and sell it in another country or in rest of the world. Export procedure is not as simple as Import procedure. It has 17 stages, on the other hand import procedure had only 10 stages. 

It will not wrong to say that export procedure is a little Complex in comparison to import procedure. Let's understand these stages in simple language.

1. Receipt of enquiry-   

This is the first stage which forms the basis of their whole export procedure here the importer asks the exporter a few questions i.e. Is the goods/items he is looking for available with you? what quantity can you export ? what will be the cost ? This enquiry is responded by the exporter in the form of letter called 'quotation' or 'performa invoice'. The exporter gives every information related to importer's enquiry. 

2. Receipt of order or indent-

Once the importer gets satisfactory response from the exporter, he places the order (called indent) of the items he wants to be imported in his country.  

 3. Assessing the importer

As we know,nobody wants to befooled from anyone. Especially in Monetary transactions. In order to avoid any risk or fraud the exporter asks the importer to show his Letter of Credit(LoC) as a proof of his (importer's) creditworthiness. This LoC is issued by the importer's bank to prove that in case the importer is unable to make payment, we(importer's bank) will pay you. 

4. Obtaining Export licence

Since the exporter is going to export goods outside his country then he needs a licence allowing him to do so.  It is a 10 digit code which is issued by the government body of the concerned country. 

5. Obtaining pre shipment finance

This is the stage from where actual work starts. Previous steps were just formalities not actual work. For the goods to be manufactured importer's demand exporter needs some finance or in simple words money. He arranges the money for this step to take place. 

6. Production 

After the exporter has accumulated enough money he immediately starts the production of items to the imported. 

7. Pre shipment inspection 

Now, the produced items are related to exporters country. Officials inspect his items to make sure the few points. 

A. The items are upto the mark.

B. The quality of goods is standard. 

C. The items are not illegal in any respect. 

D. The items will not defame our Nation's(exporting country) reputation, and other such points are inspected. 

8. Excise clearance

Before proceeding further there are certain commodities which are subject to excise duty when manufactured and certain are not (either these commodities get exemption or the charge is refunded later if paid. If refund is paid it is called Duty Drawback Scheme). Exporter will have to clear his excise duty/tax for his items first. 

9. Obtaining certificate of origin

This is really the most important for the exporter. This certificate not only shows that this item is originated in one of the factories of our country (exporter's country) but also provides some monetary benefits to the exporter i.e commission to the exporter. This is obtained just after official inspection of items. 

10. Reservation of shipping space 

In this step the exporter reserves the space for his goods to be exported in a ship.  He contacts the shipping company and gets shipping order confirmed.  Shipping order is a confirmation to the captain of the ship that this person(exporter) wants to transport this quantity of goods from here(exporting country) to there(importing country). 

11. Packing and forwarding

Once, the exporter gets space in ship he needs to get his items ready (packaged) and transport from his factory to the the port from which it is to be exported. 

12. Insurance of goods 

There, if any untoward incident like the ship gets robbed or the goods get damaged or stolen etc. takes place. Who will compensate for it? To get some compensation for this loss the exporter gets all his goods insured. 

13. Custom clearance

Any product/item whether imported or exported is a subject to custom laws. The item can neither be exported nor imported until the custom duty is paid. Once, the custom duty is cleared exporter receives the shipping bill. 

14. Obtaining mate's receipt

Mate is another name of 'captain' of the ship. Here the exporter receives a receipt which is a proof that your custom is cleared and your goods has been loaded on the ship. This receipt is transferred to the Port Superintendent which further is passed on to C&F agent. 

15. Freight payment 

payment of sweet it is made by the exporter and receives bill of lading bill of lading in evidence that your goods have been accepted by the shipping company in ready to move 

16. Preparation of invoice 

Invoice, regarding details of order i.e how much quantity was ordered/how many items were ordered or demanded. It is prepared and sent to the importer. (Generally 5 copies are prepared of it).

17. Securing payment 

This is the last stage of export procedure. Exporter collects the set of all documents and gives it to his concerned bank which does not give these papers to the importer until he makes the payment ( accepts bill of exchange).

This is how the entire export procedure takes place.

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