John J. Capela

In a perfect world for your import/export business, you could select a product you’d like to deal in and identify a great supplier, and customers would fall over each other to do business with you. Unfortunately, the real world is far more complex and unpredictable. Doing business no longer involves just making and selling a product.

If you're thinking about starting an import/export business, do some research and ask yourself some key questions to see if a career in international trade is right for you. Make sure you're in agreement with the buyer or seller of goods about basic issues regarding your import/export business and stay current on trade rules and regulations in the countries that you're importing from or exporting to.

Whether you're importing or exporting goods, business agreements need to exist between the person you're buying from or selling to, and the following key points need to be included in those agreements: The products: You need to be clear about their exact specifications so that you know what you're getting. Sales targets: This includes things like order quantities and the frequency of shipments.

The single most important document in an import or export transaction is the purchase agreement. With a suitable purchase agreement, you can eliminate or greatly reduce most of the problems that might occur. The terms of sale upon which the seller and buyer must agree include the passage of title, risk of loss, price, and payment.

Through regulations, the U.S. Food and Drug Administration (FDA) assures American consumers that foods are pure and wholesome and that drugs, medical devices, and cosmetics are safe. The FDA requires U.S. manufacturers to go through rigorous testing and inspection. Many countries have their own versions of the FDA.

An agent is similar to a distributor in that he's a middleman. However, an agent does not take title to the goods and provides fewer services than a distributor does. The agent's role is to get orders and (usually) earn a commission for his services. The following figure illustrates the relationship among the agent, the supplier, and the buyer.

If you're considering entering the world of global trade by starting your own import/export business, ask yourself these important questions to see if ready to commit your time and money to the venture: Why are you thinking of starting a business, and what makes you think you'll be successful? How much money will you invest and how much will you earn?

When you're in the import/export business, you need to realize that the process of global negotiations differs from culture to culture in many significant ways. You have to take into account communications issues such as language, gestures, facial expressions. And you also have to consider differing negotiating styles and problem-solving techniques.

Import and export laws differ from one country to the next. Make sure you know the laws regarding international trade wherever you're doing import/export business. Watch out for these common legal pitfalls: Regulations and restrictions: Be aware of how your transactions may be affected by the import/export laws in the United States or in the foreign country involved.