Any type of business requires funds to sustain their day-to-day operations. Import and export companies face the same situation as well. Fortunately, there are various export credit financing solutions that importing and exporting businesses can rely on. With these solutions, these businesses will have fewer worries regarding the funds they will need for their operations.

To be successful in acquiring and getting the most out of these export credit financing solutions, it is important to avoid certain mistakes. These top 3 mistakes you have to avoid are:

1. Failing to fully understand your credit utilization ratio. Banks and financial institutions may examine the existing debts you have on your business’ books to see if your current and projected cash flow can handle taking on additional debt. You can avoid getting a rejection from these establishments by learning beforehand how to calculate both your personal and business’s credit utilization ratios (the amount you owe compared to your credit limit) before applying for a new loan or any type of financing option. Financial experts say that a good rule of thumb is to keep your utilization rate below 30 percent for both overall and for each revolving credit line.

2. Not calculating your annual percentage or APR. There are many numbers and fees involved with any financing offer. Interest percentage rate, daily debits, and service fees are just some of these numbers. You can understand and make sense of all these numbers by first calculating the APR of your offer before signing any contract. The APR pertains to the true cost per year of borrowing money and is usually higher than the advertised interest rate. It takes into account the interest rate and compounding effects as well as any additional fees and charges. As such, it is essential to ask about the APR when looking at loan offers. If you can, learn how to calculate it yourself. If a bank or financial institution won’t give you the information you need to calculate the APR, they may not be looking out for your best interests and it would be best to consider another company.

3. Not asking for feedback from banks or financial institutions that rejected your application. Lastly, if one of your financing applications is rejected, don’t give up easily. Ask the institution for feedback and make an effort to learn from the process. Business financial consultants say you should politely ask for an explanation of the lender’s decision to see what and how you can improve for your next attempt.

Many of the U.S. based exporters and organizations involved in the international trade are aware of how important it is to follow the US federal regulations regarding exports of the goods and technology.

However, achieving compliance is not quite easy and smooth. In lack of the formal procedures that are carefully crafted with several steps of a successful program, organizations can find themselves non-compliant with the regulations immediately. Since it’s the matter of the national security, no one can just bow out of the written program and guidelines and leave the compliance in the hands of a fate. After all, the export control regulations were put together for the protection of the national security interests.

What is an ECCN and why it is important?

The ECCN (i.e., Export Control Classification Number) must be assigned to the goods, software and technology before their export and transfer. The ECCN for any given product is listed under specific categories of the Commerce Control List (CCL), and can vary based on product’s functionality, feature, and technical parameters. Further, the ECCN classification helps in identifying whether the product or technology requires an export license or if there is any license exception. Each of the categories encompasses various items on the CCL, but the items that aren’t listed on the CCL receive an ECCN of “EAR99”.

Conventional ECCN Determination Methods

How to determine the ECCN? Well, the major three methods are:

1. Identify the source. You can ask the manufacturer, developer, or producer for the ECCN of the item. Since the ECCN is subject to change, you should ensure that you have the current one.

2. Classifying it on your own. For that, you will need an in-depth technical understanding of the item’s features, content and functionality. Moreover, you have to have a familiarity with the CCL’s format and structure.

3. Send a request to BIS. With the help of CIN or Company Identification Number and PIN or Personal Identification Number, you may send an official classification request to the Department of Commerce – Bureau of Industry and Security (BIS).

As a next step you will need to know whether the export of product/technology require an export license or not. The ECCN that you determined is the key to that next step.

ECCN Determination Methods

Technology has literally transformed the way the world functions, especially through automation, speed, and accuracy.

Notably, the trade compliance consultants have made lives easier for companies and organizations. In fact, the development of software for ECCN and HTS classification has fast-tracked the performances of these companies.

In order to determine the controls, one will need to first classify the commodity, technology or software under the EAR and ITAR regulations. Therefore, the software that enables this procedure in a quick and efficient manner is extremely helpful.

Recently, the software vendors have introduced web-based solutions for the companies that have a limited budget which cannot hire a consultant or an expert. Powered by such web-based software, the exporters and importers can easily identify the items after answering a certain number of questions. Not just that, the classification results are stored for record retention purposes. The users of the software will access elaborated trade content or information in the form of definitions, duty rates, special notes, country charts, licensing requirements, and exceptions, etc.

Overall, the web-based solutions invigorate the performance of an organization, helping them increase their efficiency with rare fluctuations. As a result, the businesses won’t suffer indefinite delays of searches, communications, classifications, etc.

Take advantage of world politics today and start your own import export business. Are you organized, efficient, and ready to make your future in an opportunity all your own? Import Export Business Opportunities are expanding and there is room for you!

In the early nineteen eighties, one of the most popular things in Soviet Russia was American made blue jeans. Exporters made money hand over fist selling American made products to the East. Now, twenty years later, we have seen the fall of communism in many cold war countries. This has opened the door to the import export business companies to make handsome profits by moving goods from one continent to another.

Blue jeans in the former Soviet Union sell as good now as they did twenty years ago. But now it is not only blue jeans. American cars, computer and electronic devices, even beauty products are becoming a big business all over the eastern continents.

China has shown automobile sales in the last two years that rival the United States. Western culture, a mythical and mystical thing to many eastern countries, is being shipped in everyday. Trade embargoes are loosening and the profit margins are now being recognized all over the world.

Even the European nations are seeing an increase in their exports to the East. There are world economics at play now that were not even dreamed of twenty years ago. Imports and exports are being moved everyday, and you could play a profitable role in it all with your import export business.

Not only is there still the crave for Western Culture in the East, there is the need for lower cost goods here in the West. Importing goods from these same places can be as profitable as exporting to them. Imported products can be sold in a variety of ways from online stores and auctions to a storefront in your hometown.

There are also companies set up online that do importing and exporting and will contract you as a reseller. This can become extremely profitable. Most of the time you are not even required to keep an inventory. There is also a market for buying the imports these companies bring in and reselling them on auction sites and in retail outlets.

You will need to be aware of any taxes involved in both importing and exporting goods. Customs regulations and federal laws on imports and exports will need to be clarified before you start. Make sure that everything you are moving is legal and acceptable between countries.

Also, having a little capital to work with, say around one thousand US dollars; will allow you to get off to a solid start. Exporting goods on the Internet is one of the least expensive ways of getting started and can be done through existing import export companies.

Researching import export businesses can be done effectively online. There are many such small businesses (or at least, they started that way) who are willing to share the secrets of their success. Importing and exporting is not rocket science, nor does it require you to have a Ph.D. in economics.

One of the easiest things about import export businesses is that you are not dealing with direct sales. Most of your sales will be in bulk to distributors on the other end. This means that you will have to have little or no technical information about the products themselves, only whether they are legal or illegal to sell to that location.

Once started, you will be surprised at the income levels that can be achieved. Most importers and exporters say they were shocked that they could turn so much profit in so little time. Investigate your own import export business today!

Dealing with customers internationally or do you source the goods or parts from foreign vendors?

Then, this might interest you.

For a period, the stricter regulations under the US Department of Commerce, State, and Treasury have sent jitters to various companies. There’s no substantial reason to become non-compliant with the export regulations at all. Since the steps are taken for national interest, the vested interests would definitely find it unruly. But, the common citizenry applauds the state for taking such robust measures against perpetrators and traitors.

The ever-changing norms of export regulations are a cause of worry for the international trading community, especially the exporters. However, the different state departments are working on the way to remove the bottlenecks and ensuring seamless movement through the procedures. If you turn a blind eye to the procedures, then you may fall into a legal soup for violations, which has serious penalties amounting to rigorous imprisonment and monetary fines. The disrepute is an added burden to that.

In all, the trouble can be cut short in the midway. Generally, the ECCN classification involves several steps, such as consulting the Export Control Officer, developing superior knowledge about the product/service as well as export control regulations. If this wasn’t a phenomenal problem in itself, determining an item under ITAR or EAR would literally break anyone down. Quite not a feasible idea, isn’t it? Not only it’s time-consuming, but hampering the way business functions or functioned till date.

It’s appalling to see that some businesses have no qualms about it, leaving it to their fate as it is, instead of complying with the regulations. But, the delirium prevails elsewhere. Thankfully, the introduction of automated systems to identify products and determine the export license has benefited the businesses.

Trade compliance solutions through Automated Searches

Consistency is the key. Yes, it’s not a proverb in this context. A company, with its individual control program for exports, should ascertain consistency in the procedures. Otherwise, any dereliction would lead to severe penalization from the authorities. Similar it goes for the ITAR compliance measures. The problems of the Middle East are known to everyone, therefore, the magnified evaluation of exports to those countries is nothing new at all.

Eventually, the software vendors would get all the credit for offering superior software solutions with automated search options. Whether it is for identifying an article/item for export or checking out the trade partner’s credentials against restricted party lists, the software-enabled systems allow seamless functioning within an enterprise.

While the means of ECCN and HTS classification has been made available, it is of utmost importance that the searches are based on real-time and matching up to the standard requirement at the offices. For example, any business may tag a software with a dummy tool, only after witnessing that it’s too slow for bulk searches.

The reputable consulting companies, which offer trade compliance solutions and have industry experts in their core team would address issues of all kinds, even the petite ones with sheer experience. As a result, you have an advantage of preventing the problem at its start.

The basic steps involve:

Register a company name and obtain the Certificate of Incorporation/Certificate of Registration

Obtain an Export /Import Code Number from the Customs and Excise Department on the submission of copies of a above).

Obtain a PIN number from Kenya Revenue Authority

Obtain a VAT certificate from Kenya Revenue Authority

Obtain a Local Authority License example from Nairobi City Council.

Certificate of Origin (at the time of exporting) {Certificate of Origin are issued by the Customs Department, Kenya Revenue Authority depending on the export destination.

The Certificate of Origins issued are; COMESA Certificate of Origin, EUR-1 Form, GSP, EACD and Ordinary Certificate of Origin and AGOA Certificate of Origin

The purpose of the Certificate of Origin is to indicate the origin of exports so that they can enjoy preferential duty entry into the export market depending on the prevailing trade arrangement between Kenya and the importing country. For any individual to have an import export company there company has to be a member of KIFWA. KIFWA membership is Ksh 17000 (Admission Ksh 10,000, Subscription Ksh. 7,000). Membership takes a few minutes. Once paid up you will receive a clearance certificate which a copy should be given to KRA for you to get a license.

The import export companies can be in two categories:

• Clearance and forwarding companies

• Importers of raw material to make finished goods.

It is necessary to make the companies limited.

All documentation gets processed in September, and they are also forwarded to the Customs Union.

KIFWA interviews the new directors and in case of failure an individual can always appeal or try the next year. When an individual passes they get to be given the license and the password for the KIFWA site.

The timeline of this whole process will take 5 to 6 months. Once accepted the company should be able to take a custom bond fee from 300,000 to up to 600,000.

The primary objective of applying PVoC is to ensure quality of products, health and safety, and environmental protection for Kenyans. Among the benefits expected, besides products being shipped conforming to standards and regulations, PVoC is expected to:

♦ Block unfair competition from sub-standard products and especially stop the influx of counterfeit products

♦ Speed up release process of imports

♦ Reduce importation costs

♦ Reduce the number of destructions or re-exportation of consignments

The Pre-export Verification of Conformity (PVoC) to Standards programme is a conformity assessment and verification procedure applied to specific imported products at the respective countries of export, to ensure their compliance with the applicable Kenyan Technical Regulations and Mandatory Standards or approved equivalents. The overall objective is to minimize the risk of unsafe and substandard goods entering Kenyan market, thus ensuring health, safety and environmental protection for Kenyans.

Exporters of U.S. made goods can use an IC-DISC to reduce their U.S. tax by 10% or more of their profits on those goods. This export tax benefit is available only if the goods are at least partly manufactured in the U.S. and have at least 50% U.S. content. Both manufacturers and distributors of the goods can get the tax subsidy for exports.

If the goods you export did not fully originate in the U.S., you may still qualify. Example: Fred’s Copiers LLC in San Diego buys used Japanese made copiers and printers, refurbishes them, and sells them to customers in Southern California and Mexico. In most cases, Fred’s must replace one or more rollers, and usually some plastic parts. The work is done by skilled workers using hand and power tools. A typical copier costs Fred’s $200 for the old copier, $51 for parts purchased locally, and two hours of labor, and sells for $500. The copiers sold to customers in Tijuana probably qualify.

IC-DISC rules require that the goods be partly manufactured in the U.S. Fred’s is doing activities that may be considered manufacturing under U.S. law. In Bausch and Lomb, 71 TCM 2031 (1996), the U.S. Tax Court held that assembling sunglasses was manufacturing. The Court found that the skill needed to efficiently assemble the sunglasses indicated that the activities were manufacturing. It contrasted this to its ruling in Garnac Grain Co., 91 TC 131 (1988), where the Court held that grain storage and drying was not manufacturing. In that case, the Court found that the activities were not considered manufacturing by the industry.

Whether an activity is manufacturing or not depends on the facts. If trained labor is a key part of the process, multiple parts or components are required, and there are multiple steps involved, then the activity likely is manufacturing. See the Tax Court’s ruling in Dave Fischbein Manufacturing Co. v. Commissioner, 59 TC 338 (1972), which involved assembly of parts.

Goods must also have 50% U.S. content. IRS regulations specify that U.S. content is the total sales price less the value of the foreign content. The value of foreign content is the value of imported articles as of the time such articles are imported into the U.S. The regulations state that this value is their full dutiable value for customs purposes, whether or not duties apply. Generally, this means the value exclusive of shipping and insurance at the “first sale” of the goods. For example, if a Hong Kong manufacturer sells the a part to a wholesaler, who then sells it to a customer, the first sale price is the price the Hong Kong manufacturer gets. For Fred’s, the foreign value is the $200 old copier plus part but not all of the $51 for parts. Thus, the foreign content of the copier sold by Fred’s is clearly less than $250, and it meets the U.S. content requirements.

IRS rules allow Fred’s to determine if the copiers qualify either on a sale by sale basis, or by grouping multiple sales. Several grouping options are available, and choice of the option to use depends on the particular business. Grouping can also improve the results of IC-DISC calculations.

Both manufacturers and distributors can get IC-DISC tax benefits. If Fred’s sells the copiers to Jimmy’s Office Warehouse, who sells them to Tijuana customers, both Fred’s and Jimmy’s can get DISC benefits. Fred’s should ask Jimmy’s how many copiers they sold for use outside the U.S., and let Jimmy’s know that the copiers qualify for the IC-DISC tax break.

Determining what qualifies for the IC-DISC export tax subsidy can be complex. Setting up an IC-DISC in a way that maximizes the tax benefit can also be complex. Get the personal attention and experienced IC-DISC help you need to save taxes. Call Steve Fox today. It’s your business, get personal.

This is a problem that I have asked about many times and one that you will no doubt have come across if you use Access and Excel together and export any data from Access on a regular basis. The issue is an error or warning in Microsoft Access when trying to export data to Microsoft Excel that says

‘You selected more records than can be copied onto the clipboard at one time’ when exporting data from Microsoft Access to Microsoft Excel.

By default when exporting data from Access you would normally follow this method

• Select External data
• Got to Export
• Hit Excel
• You will be given a choice to select the destination for your data
• Select where you want to save your exported data
• In the Specify Report Options Area- you have the option to select and tick Export Data With Formatting And Layout
• You also have the option to open the destination file after the export operation is complete- tick if you want to utilise this option
• Hit OK
• You may now get the above error at this stage if you have ticked the Export Data With Formatting And Layout Option and are trying to export more than 65,000 data lines
• When the data is exported you can then hit Close

From Excel 2007 onwards the capacity of Excel Rows is way more than previous versions (in fact it is 1,048,576 whereas previous versions the capacity. So, why is Access limiting me to 65000 lines?! like in Pre 2007 times.

Not quite pre- historic but it is sure as heck feeling like it when you get the above warning when exporting data.

When you select the Export Data With Formatting And Layout Option in Specify Report Options Excel will actually copy the contents to the old style Office Clipboard, hence you get the warning of not being able to copy more than the 65,000 lines.

So, to avoid the error all you need to do is un tick the Export Data With Formatting And Layout Option in Specify Report Options Excel, if it is ticked then go right ahead and hit OK. This will enable you to export more than one million lines- from Access, but no formatting or layout settings will be transferred over.

The issue is not one that is difficult to resolve but it is not an obvious solution either. But once you know why the issue is happening it is really easy to resolve.

If you want to get into exportation, you must know that the opportunities come with a significant amount of risks. An export documentary credit is among the efficient risks management tools used by season exporters.

Advantages Of Export Documentary Credit

First, it can help minimize the risk of non-payment by your customers. If you issue a documentary credit, the bank of your customer must pay you upon presentation of the export documents.

Second, using this will provide you access to funds without the need to draw from the credit facilities of your company. You just need to present the required documents to your banks. When these documents won’t comply, your bank will provide you with an advance once your documents are accepted.

It is very important for you to choose the right bank to partner with as this can help make sure that you avoid problems related to document compliance.

Who Needs A Documentary Credit?

Companies wanting to minimize the risk of non-payment – This can actually be achieved by utilizing bank channels in order to control commercial documents.

Exporter with customers who are unable or unwilling to provide documentary credit

Companies that need to quickly process documents and resolve payment problems

Companies wanting to provide a very flexible credit term to buyers without the need to compromise their position in cases of non-payment.

How It Works?

You and your buyer must first agree on using this solution as the form of payment. Both of you must sign a contract. After that, your buyer must apply for a documentary credit. The bank, on the other hand, needs to determine if your buyer is credible and qualified. When the requirement of such bank is satisfied, it will then provide the documentary credit. And this document will be forwarded to your bank.

When your bank received these documents, it needs to authenticate the documents and make sure that these adhere to the terms and conditions. Your bank will also notify you that it already received the documentary credit. You, on the other hand, must check if the documents will match the stipulations in your contract with your buyer. When there are discrepancies, you must ask your buyer to resolve such.

You can then ship the orders of your buyer after that as well as present the required documents to your bank. Your bank needs to verify these documents and forward it to the bank of your buyer to request for payment.

Lastly, the bank of the buyer must examine these documents. After which, it will forward the payment to your bank.