Three Mistakes To Avoid Before International Trading
International trade is complex and depends on many intricate factors. It is entirely possible to do everything right but still end up disadvantaged due to a small oversight. Some of these mistakes are more common than others and easily avoidable. So, here are 3 common mistakes you should avoid as you engage in international trade.
Foreign Exchange Risk
Currency exchange rates fluctuate daily. Sometimes they can even change rapidly over a short time. You must take this into account before you ship or have your products shipped as you may be exposed to foreign exchange risk in the time window between shipping and payment being settled.
You need to create your own policy for this and take necessary precautions such as hedging against exchange rate risk. If you work with a competent global bank that is focused on trade, such as Euro Exim Bank, you will have access to professional advice and tools to help mitigate this risk.
National & International Regulations
You must be aware of regulations in your own country, in the destination our source country and any applicable laws or regulations that your shipment may be subject to during transit. Regulations change and often differ between countries and regions.
Today, using the internet it is easy to stay up to date on these regulations. For better results, you can even sign up with the authorities in a country (such as customs) to receive updates on changes. You alone are responsible for being aware of and complying with these regulations and laws, locally and internationally. Failure to do so can be very costly, so watch out.
Packaging & Marking Regulations
Different categories of products will have different requirements for packaging, marking and declaration. This again may vary from jurisdiction to jurisdiction. Categories of goods such as cosmetics, electronics, dangerous substances and household appliances may have very specific requirements for marking and labelling. You need to take these into consideration and prepare accordingly.
Your international trade dealings can be seamless and easy if you are aware of your obligations and pay good attention to all the details that matter. Speak with your international bank if you need assistance as they usually have teams of professionals to assist you.