Are you trying to delve into the import business but found the duties, and taxes too intimidating?
There are several things that can pile up your bills when it comes to running an import business. When the paperwork is not completed properly with adequate research, your bank account may take a hit. Saving money on imports is as easy as reading this blog!
Follow along to know seven tips that can help you save up while gaining better profits.
- 1 Top 7 Tips To Save Costs In Import Clearances
- 1.1 1. Correct classification of products in the customs tariff:
- 1.2 2. Accurate tariff treatment in origin countries:
- 1.3 3. Accurate product valuation:
- 1.4 4. Choosing the best customs broker:
- 1.5 5. Saving costs on brokerage fees:
- 1.6 6. Cost reductions through transit time:
- 1.7 7. Tax and duty refunds:
- 2 Wrapping Up:
Top 7 Tips To Save Costs In Import Clearances
1. Correct classification of products in the customs tariff:
So many importers make the mistake of losing out on profits by undervaluing or overvaluing their imported products. This may either lead to losses or penalties, both of which aren’t good for your business.
Take the time to pay attention to classifying your goods and consignments correctly in order to save up on import duties. Moreover, you’ll also find that certain products may have a higher tariff rate in one country or may experience a duty relaxation in another.
2. Accurate tariff treatment in origin countries:
Each country has a different customs tariff that they follow while importing and exploring goods. Many countries follow bilateral and multilateral import tariff clauses to make sure the correct amount is levied on products leaving their country.
This may either lead to a higher import duty or a lowered one, based on the country you’re dealing with. Supposedly you’re procuring goods from China, the duties attracted may follow the MFN or most favored nation clause for valuation. Ensure that you have your numbers right to avoid any revisions and penalties.
3. Accurate product valuation:
One of the most essential aspects of importing products is declaring the right price of the products being imported. This may be a slippery slope for many, since valuation may differ in the country of receipt. Every country has a different method of valuation when it comes to product import.
Also, the valuation of these goods may keep changing, subject to the alterations made by the company. For instance, the valuation may be increased or decreased due to the taxes applied.
All you need to do is complete your research as per the countries involved in your importing process and apply the correct valuation based on the updated price.
4. Choosing the best customs broker:
Doing the paperwork for importing consignments may sound like a smart cost saver but may be a decision that ends up costing you. Not only is there a larger scope for mistakes and human errors when you pursue running through the import order paperwork, but also may attract fines.
Losing out on years’ worth of profits due to a valuation criterion is not worth the big picture. Take the help of us customs brokerage for imports to make sure that all of your bases are covered well.
An agency with a considerable number of brokers can help you work without worry while they cover all the bases of your importing business. Be it paperwork or keeping up with compliance, they can smoothen the process of your workflows while you pay attention to the operational aspects of it.
Not only do they have the reputation to get things done seamlessly, but you’ll also be able to sleep better at night knowing your consignment imports are in good hands.
5. Saving costs on brokerage fees:
Your customs broker may be amazing at their job, but the prices to be paid per shipment may eventually hurt your bank account. Instead, try reaching a productive conversation regarding ordering volume and your broker’s fees.
By asking them to charge you fairly as per the amount of business you bring them, you’ll be saving up a lot of money in the long run. One of the simplest ways to get a discount from your broker is by discussing the order transactions with them.
This may be a complex conversation if your business is just in the inception phase. But it is worthwhile for when your business flourishes in size, inviting more fee relaxations. You can also combine with a group of importers hiring the same broker in order to receive larger discounts in the meantime.
6. Cost reductions through transit time:
When speaking about importing and import duty, time is of the essence. One such aspect is looking after how long your consignment takes to reach you. The longer route it takes in the name of shipment cost savings, the more countries and destinations it may touch, resulting in higher import duty.
This may also bring unprecedented delays and confiscation of your consignment, both of which consume extra capital to expedite. Choose a shipment partner who will deliver your orders at the earliest through the preferred means of cross-border transportation.
One of the hallmarks of a wonderful shipping company is real-time tracing. Apart from this, you can also talk to them about the transit fee inclusions and whether they insure your goods while shipping to avoid any potential losses.
7. Tax and duty refunds:
It is the duty of your customs broker to help you save as much money on taxes and refunds based on the paperwork. Sometimes, inadequate paperwork and improper filing may attract larger tax brackets. It can also happen that any rebates expected from the import duty and other charges levied may be hindered if you’re not careful about the filing and procedure.
A way to reduce your costs of import is to have an import broker process your documentation for taxation purposes. This may include modifying certain paperwork and making the necessary changes as may be required by the post-pandemic protocol.
In terms of receiving the highest degree of rebates, your broker would have to find the right clauses and sections that could help you save up as much as you can.
Now that you know about the things it takes to successfully run an import business and profit from it, you’ll also be able to tell which tips you need to apply on priority. We hope this blog helps you save valuable capital and bring in more profits!