Guide to Importing Goods:

importing goods

Understanding Processes and Costs for Overseas Trade

Evestico receives many enquires from companies needing help with importing goods from overseas into the UK. A significant proportion of these are from companies who have never undertaken this task before. So, we have produced this brief article to help explain the process. It was prompted by a recent enquiry we had from a company who wanted to import a container of alcohol from South Korea. We could have wrote a whole book on this process and it still wouldn’t have been sufficient, because it also takes years of experience and having the right contacts to help smooth the journey. But at least this will give you some concept of what is entailed. Importing goods from overseas, especially from regions like the Far East, involves several steps and cost elements. Let’s break down the process and associated costs:

Product Sourcing and Supplier Communication:

  • The first step is finding a reliable supplier for your goods. This involves research, negotiation, and communication to ensure product quality and pricing meet your requirements.
  • Cost: This varies depending on factors like product complexity, negotiation skills, and market conditions.

Shipping and Freight Costs:

  • Once you’ve finalised your order, you’ll need to arrange shipping. For large quantities, like a container of alcohol, sea freight is common.
  • Costs include freight charges, port fees, customs clearance, and potentially insurance.
  • Cost: Sea freight costs depend on factors like distance, container size, and shipping route. Customs clearance fees and port charges vary by country and port.

Customs Duties and Taxes:

  • When goods arrive in the destination country, customs duties and taxes may apply. These are based on the declared value of the goods and their classification according to the Harmonised System (HS) code.
  • Alcohol imports often incur specific excise duties and taxes due to their regulated nature.
  • Cost: Customs duties and taxes can significantly impact the total cost of importing goods and vary based on product type and destination country regulations.

Bonded Warehouse Storage:

  • Storing goods in a bonded warehouse allows for deferring payment of customs duties and taxes until the goods are released for sale or distribution.
  • Costs include warehouse storage fees, handling charges, and potentially additional services like inventory management.
  • Cost: Bonded warehouse fees vary based on factors like storage duration, space required, and services utilised.

Quality Control and Inspections:

  • Depending on the product and supplier, you may want to conduct quality control inspections before shipment or upon arrival.
  • Costs include inspection fees, travel expenses (if conducting on-site inspections), and potential rework costs for non-compliant goods.
  • Cost: Inspection fees vary based on the scope of inspection and the chosen inspection agency.

Documentation and Compliance:

  • Importing requires extensive documentation, including commercial invoices, packing lists, certificates of origin, and compliance documents (e.g., health certificates for food or alcohol).
  • Costs include document preparation fees, translation services (if required), and potential penalties for non-compliance. It worth noting that many frieght forwarders won’t handle alcohol because of the complexities involved.
  • Cost: Documentation costs depend on the complexity of the shipment and any additional regulatory requirements.

Logistics and Distribution:

  • Once goods are cleared from customs and stored in the bonded warehouse, you may incur additional costs for logistics and distribution to fulfill customer orders.
  • Costs include pick and pack fees, shipping charges to end customers, and potentially returns processing.
  • Cost: Logistics costs vary based on shipping method, destination, and order volume.

Summing up Importing Goods

Navigating the import process and understanding associated costs is crucial for successful international trade operations. By considering these factors upfront, businesses can effectively plan and budget for importing goods from overseas.

Evestico can help you navigate your way through all of these processes, but unfortunately due to the amount of work involved, we only offer this service as part of our Country Manager Service.