Export & Import

Small business start up information

Exporting

1. What are the business benefits gained through exporting?

2. I would like to consider growing my business by exporting, where can I get help? 

3. Are you ready to export? 

4. Are there any Australian laws covering the exportation of Goods to overseas markets?

Importing 

1. Where can I find out what sort of restrictions, licenses, permits or quarantine issues are associated with the product I wish to import?

2. Do I need to pay duties on the products I import?

3. What Australian Standards does an imported product need to meet to be accepted in Australia? 

4. What are International Commerical Terms

5. What abbreviations and terms are used in the importation industry? 

6. Are you really ready to import? 

7. Will the supplier invoice in Australian dollars (AUD) 


Exporting

1.What are the business benefits gained through exporting?

  • Developing economies of scale
  • Taking advantage of seasonal factors
  • Improving performance
  • Pursuing new opportunities for growth
  • Extending the life of a product
  • Using excess capacity

2. I would like to consider growing my business by exporting, where can I get help?

Austrade’s aim is to help more Australians succeed in export and international business by providing advice, market intelligence and support to Australian companies to reduce the time, cost and risk involved in selecting, entering and developing international markets.  The Australian Institute of Export was established in 1956 (a not-for-profit private sector organization) designed to assist Australian exporters and export service providers.  The Institute operates in all States of Australia, and is a member of the International Association of Trade Training Organisations.  The Victorian Government has a fantastic downloadable “Export Planning Guide” to help get you started. This guide is designed to provide initial information for small businesses seeking to export products or services to international markets. Click here, to view a copy.

The small Business Website for NSW also has an informative collection of Self Help Export Planning Tools: Click here to view a copy

3. Are you ready to export?

Before you decide to export, take time to check if you are export ready? The following are a couple of check points?

  • Does the product range intended for export require modification to adhere to overseas rules and regulations?
  • Have you clearly identified an overseas target market whose needs will be successfully satisfied by your product?
  • Are there any challenges associated with cultural/ religious differences, language barriers, import controls which could affect the exportation of your product?
  • What if any are the applicable customs duties payable upon exportation?
  • Have you designed a marketing strategy to introduce your product onto the overseas market, i.e. Possible distribution channels, pricing strategy and terms of sale?
  • Do you have the physical capacity to accommodate large international orders, i.e. warehouse storage, production machinery, and labour?

4. Are there any Australian laws covering the exportation of Goods to overseas markets?

The Australian Customs Service (Customs) controls and regulates the laws governing the export of goods from Australia.  The Australian Customs oversee the exportation of goods to:

  • Prevent the export of goods of poor quality or incorrectly described goods to protect the reputation of Australian industry
  • Prohibit or control the export of specified goods or goods to specified places
  • Provide data for use in Australia's balance of trade statistics
  • Control the export of certain primary products which are covered by international commodity agreements or whose marketing is subject to the authority of a local marketing board.

Importing

1. Where can I find out what sort of restrictions, licenses, permits or quarantine issues are associated with the product I wish to import?

For information on restrictions on imports or fumigation go to www.aqis.gov.au For a full list of Aqis publications on all Quarantine and Inspection items Click on "Publications" from the left hand side menu, of the Aqis home page, then click on "Australian Quarantine & Inspection Services".   You could even visit the Australian Governments website for Department of Agriculture, Fishers and Forestry, please click here.

2. Do I need to pay duties on the products I import?

For information on customs related matters such as duties go to www.customs.gov.au.

3. What Australian Standards does an imported product need to meet to be accepted in Australia?

If you are importing a commodity that will be used by the general public or children you will have to meet Australian Standards and you can find out about your product requirements by emailing: research@sai-global.com.

4. What are International Commerical Terms?

Your supplier/s will offer you a quote for your goods under a certain Terms of Trade. The terms of trade dictates where the supplier’s responsibility for the cargo ends and yours begins.  Please note you don’t have to accept the terms of trade under which the supplier may quote, you should negotiate the terms of trade to suit your needs. China usually operates on FOB terms and USA and Europe are generally Ex-Works.

5. What abbreviations and terms are used in the importation industry?

International Commercial Terms (Incoterms or Terms of Trade)
The Incoterms, which are also known as terms of trade, are standard trade definitions most commonly used in international sales contracts. Developed and administered by the International Chamber of Commerce in Paris (ICC), Incoterms are universally recognized and adhered to by the major trading nations of the world. Incoterms describe the supplier and buyer’s obligations and specify the point when the responsibilities for the transportation costs shift. There are currently 13 Incoterms in use but we will only explain the Incoterms most frequently used in Australian Imports/Exports.

1. EX-WORKS (Ex factory)

Under Ex-works the seller minimizes his risk by only making the goods available at his own premises. Ex-works represents the minimum involvement of the supplier and the maximum involvement of the buyer in the arrangement of the transportation of the goods from the premises of manufacture to their premises.

Buyers Obligations under the Ex-works term;

  • Inland freight
  • Export customs clearance
  • Origin port charges
  • Payment of customs charges and taxes in Australia
  • Main carriage/freight
  • Cargo (marine ) insurance
  • Unloading from the main carrier and port charges
  • Customs clearance in buyers country
  • Payment of customs duties and taxes in buyers country
  • Inland freight in buyers country
  • Other costs and risks in buyers country
2. FOB (Free on Board)

FOB is one of the most common terms used in international trade. Under FOB the supplier is responsible for delivering goods to the named port, export customs clearance and loading them onto the vessel. The point of transfer of responsibilities under FOB is described as the point “when the goods pass the ship’s rail”. That means that if during the loading onto the ship, the goods would fall on the wharf or into the water, the supplier would be responsible for the losses, but if the goods fall on the deck of the ship, the losses are the buyers.

Buyers Obligations under FOB Terms;

  • Main carriage/freight

  • Cargo (marine) insurance

  • Unloading from the main carrier and port charges

  • Customs clearance in buyers country

  • Payment of customs duties and taxes in buyers country

  • Inland freight in buyers country

  • Other costs and risks in buyers country

3. CFR (formerly C & F changed 1990)

Cost and freight - The supplier is responsible for export customs clearance, delivering the goods to the named port of destination.
 
4. CIF
Cost, Insurance and Freight - Responsibility of supplier to arrange export customs clearance, delivery of goods to named port of destination and insurance of goods.
 
Buyers Obligations under the CIF & CRF terms;
  • Customs clearance in buyers country
  • Payment of customs duties and taxes in buyers country
  • Inland freight in buyers country
  • Other costs and risks in buyers country
  • Marine Insurance (CIF only)

6. Are you really ready to import?

Before you launch into the importation market, tkae time to consider if you are ready:
  • Can the product be sourced in Australia? And if it can’t you need to investigate why this is the case, i.e. is it possible there are is a lack of demand for the product, is it worth importing?
  • Have you check to see if there are any prohibitions or restrictions on the product?
  • Is the product safe? i.e. Does it adhere to the Australian Standards applicable to the product?
  • Does the packaging on the product need to be converted to conform with Australian Standards, i.e. labels, ingredients specified etc..
  • What measures are in place to inspect and check the quality of the imported product?
  • Have you check if the product could possibly infringe any intellectual property, copyright, licence agreements and or trade mark law applicable in Australia?
  • Is the product subject to customs duties or GST?
  • Have you looked into using the services of a Customs Broker, or Freight Forwarder to help import the goods?
  • How will you pay the overseas suppliers?
  • How are you going to market the product to the Australian market, are there any possible barriers to acceptance of the product?
  • Which costs will you incur to import the product and which will be born by the supplier?
  • Have you considered all likely costs including transport, duties, insurances and other possible unforseen costs?
  • Do you have everything in writing, i.e. the quote, terms of trade and acceptance of offer.
  • Where will you store the product, have you organised whare house or storage facilities.
  • Is there anyone else in Australia importing the product and if so how will this affect your likilhood of success selling the product?
  • Have you negotiated the exclusive rights to import the product into Australia?
  • After taking into account all costs associated with importing the product into Australia, how much profit are you likely to make? Is it a reasonable margin?

7.  Will the supplier invoice in Australian dollars (AUD)

Generally speaking overseas suppliers do not invoice in Australian dollars the general accepted currency is US dollars. Since invoices are not payable in Australian dollars you will need to allow for adverse fluctuations in exchange rates. To over exchange rate flucuations you could contact your bank, and see if they offer a service to cover the exchange rate risk.  Some banks offer what is called a forward exchange contract. A forward exchange contract is a formal agreement between a bank and a customer to exchange currencies in the future at a fixed exchange rate. 

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