Mechanism of trading internationally

The Trade Transaction

GOODS

A BINFORMATION

PAYMENT

Eleven step process Step 1

Prepare a Business plan

Name of the organization

Registration under

companies act

Open a bank account

Step 2

Product selection for

export Market research Product evaluation

Step 3

Registration with Director General of Foreign Trade to

get IEC number

Step 4

Registration with the relevant

export promotion

Registration with Sales Tax Office

Registration with Export Credit Guarantee

Corporation

Step 5

Market Identification Need Analysis

Step 6

Channel SelectionAgents/Distributors/

Wholesalers/ EndUser s/ Sales Reps

Step 7

Identifying the Potential Buyers / Customers

Trade Fairs/Internet/ Personal Visits/Contacts/Agents

Going for procuring orders

Step 8

Agreeing upon pricing, document ,freight charges, currency ,delivery etc.

Signing of contract

Step 9

Determining the payment terms

Advance Payment/ Letter of Credit (LC) / Open Account

Step 10

Importer sends

purchase order

Production Packaging, warehousing

Certificate of quality control

Step 11

Prepare marine, air, and docs

Insurance certificate,

shipping bill Receipt, Bills of

lading

Transportation Maritime / Air /

Road / Rail

Submission of docs to banks

Bank sends docs to importer’s

bank .payment is done

International trade transaction procedures

CommercialProcedures

• Establish Contract

• Order Goods• Advise On

Delivery• Request Payment

TransportProcedures

• Establish Transport Contract

• Collect,Transport and Deliver Goods

• Provide Goods Receipts Status reports

RegulatoryProcudures

• Obtain Import/Export Licences etc

• Provide Customs Declarations

• Provide Cargo Declaration

• Apply Trade Security Procedures

• Clear Goods for Export/Import

Financial Procedures

• Provide Credit Rating

• Provide Insurance

• Provide Credit• Execute Payment• Issue Statements

Prepare For

ExportExport

TransportImport

SHIPBUY PAY

Prepare For

Import

Commercial procedures

Establish contract

Order goods

Advice on delivery

Request for payment

Transportation procedures

Establish transport contract

Collect, transport and deliver goods

Provide goods receipts and status reports

Regulatory procedures

Obtain import export licenses

Provide customer deceleration

Provide cargo deceleration

Apply trade security procedures

Finance procedures

Provide credit rating

Provide insurance

Provide credit

Execute payment

Issue statement

Questions….

Thank you!!!