Importing can open up your business to a world of new products and customers, quite literally. But while the lure of lower priced supplies, the ability to market new products, or just a larger reach may seem too great to ignore, it’s important to be clear on potential pitfalls of importing. Not only is licensing a concern, but protecting your business from financial losses due to fluctuations in the exchange rate should also be a priority.
If you’ve carefully thought through the implications of importing such as how it will affect your business and the time and effort it will take to initiate and then maintain, you’ll still need to take a look at licensing. Imports into the UK are controlled by HM Customs & Excise, and licenses are required on a number of different items such as firearms, food, medicines, plants and animals, chemicals and textiles. The originating country will also have an affect on whether an import license is required, so before you sign that contract make sure you’ve done all your homework.
Any item brought in to the country will, in all likelihood, need to comply with the UK regulations for that item. For example, food imported will need to comply with UK food safety, labelling and additive regulations before being authorised for import. Anything strictly regulated for sale in the UK, particularly if dangerous or sold for human consumption, will also likely be strictly regulated for import, as you would imagine. If in doubt, contact HM Customs & Excise for further information before attempting to import.
The price you agree on with your foreign supplier could be another potential issue you need to protect your business from. As exchange rates fluctuate, that price could drastically affect your business, possibly resulting in the loss of thousands due to just a small negative change in the price of currency. Talk to your bank about hedging, essentially a means of insuring against the rate of exchange rising against you in the future. Most UK clearing banks can offer two ways of overcoming issues with exchange rates; forward foreign exchange contracts and UK based foreign currency accounts. Either will help you overcome potential losses but should be thoroughly researched before deciding on the best one for your business.
While importing is much like working with any new supplier, the added issues of distance and language barriers on top of foreign currency issues and license requirements can sound off-putting but it’s important to remember the potential business rewards could be significant, allowing your business to bloom.
To make sure the delivery cost doesn’t make the project budget fly through the roof, make sure you gather quotes from a number of companies who can ship your goods. Delivery Quote Compare offer a free quote service, where you’ll receive a number of quote from different companies. You can compare the quotes and get the best price for you and your business!