Even after the historic Brexit vote, the UK is certain to remain an outward-looking nation – probably even more so, now that trade deals are being struck with countries far beyond the EU.
Importing the right products to meet the demand of a sophisticated market with money to spend is the key to success for many traders – nearly 70% of exporting companies also import goods. Keep a few golden rules in mind and you could be joining the new generation of truly global British businesses:
- Choose Wisely
We’ve all been disappointed by the occasional online purchase. Nothing beats going round the shops yourself to compare quality and not just price. Entering into a partnership with an overseas supplier is the same, but a million times more critical. You need to be able to trust your supplier and see how their operation runs, whether it’s a manufacturing or a wholesale business. This in turn can mean expensive travel, so if you can’t meet all your foreign suppliers face to face, make sure you speak to other UK traders and organisations with experience of doing business with that country or business.
- Money Talks
To maintain your supplier relationships, you need to make sure they’re paid on time. Whether you agree to pay your overseas beneficiaries up front, when the goods are sent, when they’re in transit or when they reach the UK, you’ll need a fast, reliable and cost-effective international money transfer service. Covercy, licensed and regulated by the UK FCA, provides a user-friendly platform that delivers faster, cheaper transfers than any bank, saving you up to 80% on fees.
- Stay Tuned
Small changes in exchange rates can seriously affect how much you pay for goods. Covercy monitors the currency markets around the clock, helping you to benefit from the strength of Sterling relative to other currencies.
- Planes, Trains & Automobiles
There’s nothing worse than a dissatisfied customer, so it’s essential to guarantee that your order arrives on time. For smaller orders you might be happy to handle logistics yourself, but for major consignments, especially those destined for multiple retailers, it’s best to consider using a specialist freight forwarder. There are pros and cons for seafreight, airfreight and courier or postal services and your choice will depend on the overall weight, value and perishability of the goods.
- Trade Smart
There are numerous legal ways to reduce your customs costs, including goods classification, tariff engineering, bundling or stripping products apart, duty preferences, onward sale, inward processing relief, returned goods relief, and payment timing. Check out this guide and weigh up your options.
- Play with a Straight VAT
There’s currently a great deal of discussion about UK VAT and how vendors from certain countries are avoiding it. It’s vital that you comply with the relevant regulations as you build your business, to avoid any unpleasant surprises further down the line.
- Cover Your Back
Get your head around Incoterms, the rules which outline exactly who is responsible – who holds the risk – for the goods at every stage of the import process. There are various internationally recognised categories and it’s your responsibility to tell the supplier which one you want to use.
Your goods are the lifeblood of your business and you need to be fully insured in case of the unexpected. Most registered freight forwarders can sort out your policy, but don’t assume that it’s automatically included in your shipping deal and always get it in writing! Alternatively, you can buy an annual policy, or one for an individual shipment, from a specialist cargo insurance broker.
- Quality Time
Nobody likes getting complaints – and a product recall is the worst possible outcome for any importer. UK health and safety standards are some of the strictest in the world – even more so than the EU equivalents. Make sure you’re up to speed here.
- Don’t be a Paper Tiger
Keeping your documentation in order is vital to make sure that your affairs are in order. If you don’t stay on top of it, you could be heading for trouble, and it will constantly prey on your mind, harming overall effectiveness. A reputable freight forwarder will be able to handle most of the paperwork on your behalf but read these guides from HMRC and Business Link so you’ve got a good handle on everything that’s required.
- Go with the Flow
Cash flow is king. You’ll certainly have to pay your suppliers before you see the return on your investment from your customers. Make sure you have a detailed schedule of your payments and receipts to ensure that you always stay in the black.
Covercy offers Small & Medium Businesses a more efficient way to execute cross-border transfers. Click here to try the service.