Goods export services

The openness of the economy has led to the growing development of export services. It is gradually becoming a key economic sector of Vietnam. So what is the definition of good exporting and what are the key types of good exporting? Let’s find out more details with Viet Linh in the article below.

What is good exporting?

Goods exporting or good exporting services is simply understood as goods produced in one country and sold to a buyer in another country. Exporting and importing help international trade develop, which makes an important contribution to each country’s economy. It allows residents of various countries to produce goods, hire producers, export and earn foreign exchange. On the other hand, the importing country will benefit from the goods they buy because these products are in shortage with their domestic supplies.

For example, Vietnam is a country with developed agriculture, possesses large rice growing areas and has become a large rice exporter in the international market. The countries that buy rice from Vietnam merely do not have the similar conditions to develop the rice growing industry, so they have to import rice from Vietnam to distribute to their people.

3 conventional methods of exporting

Currently, there are 3 transportation methods to export your products to another country including:

Transport by road

This method of transportation often applies to countries that share a common border, or short travel distances, and container trucks will commonly be used to transport goods.

For example, Vietnam will export by road to some neighboring countries such as China, Cambodia, Laos… This method will take quite a lot of time but it is generally cheaper than other methods.

Transport by sea

It means that businesses will use large ships and travel by sea to deliver goods. This method is suitable for countries adjacent to the sea and building seaports. It generally has a low cost and can transport many different types of goods such as clothes, steel, cars, etc.

Transport by air

This method is considered to be expensive, but in return it is the fastest delivery method. This method is often applied to long-distance transportation and perishable goods such as fruit, fresh food, fresh flowers, etc.

It can be recognized that each method of transportation will have certain advantages and disadvantages. Therefore, it is essential to pay attention to what your export products are to take steps to calculate and choose the most suitable transportation methods to help businesses bring domestic production to foreign markets.

Several present exporting channels

Previously, when the economy was not yet open, there was only one form of export following the B2B model. This is a form of sales from business to business overseas. Today, goods exporting services are divided into two main methods: direct export and indirect export.

Direct export

Direct export is a form of buying and selling goods and providing services in which the buyer and seller agree, exchange and negotiate the benefits of each side in accordance with the laws of the participating countries. This method has the following advantages and disadvantages:

Advantage

Some of the top advantages of direct exporting are:

• Control all procedures and goods transactions
• Helps export/import businesses gain higher profits
• Build and link your own customer files

Disadvantages

In addition to the above advantages, this method also has the following disadvantages:

• For those new to the industry, it will be difficult to find customers
• Requires businesses to invest in large human resources, leading to high investment costs
• Businesses easily encounter many risks in transactions

Entrusted export

This is a type of export formed between an enterprise operating domestically and having several products that can be exported but not meeting the financial conditions or acquiring business relationships with international partners… so they have to entrust another business that is capable of directly implementing foreign trade transactions for supporting the process of exporting goods according to their requirements. The entrusted party must negotiate with the foreign country to carry out export procedures at the request of the entrusting party and receive a commission called the entrustment fee. The relationship between the entrusting enterprise and the entrusted enterprise is fully specified in the entrustment contract.

Advantage

This method of entrusted export has the following advantages:

• No need to invest costs, no experience required because of the availability of a third party supporting in the entire exporting process.
• All administrative procedures are supported by a third party. Therefore, it will be faster than doing it yourself
• Businesses do not need to spend money to find partners or potential firms in the target country.

Disadvantages

Although indirect exporting has its benefits, the following are the disadvantages of indirect exporting.

• Businesses will earn less profit because it has been divided to a third party.
• Businesses do not have control over their own price and brands
• Businesses will depend on the capacity of intermediaries.
• Businesses do not gain understanding of foreign markets and will have difficulty in developing in the long term.

What steps does the process of exporting goods include?

The goods exporting services to foreign markets require numerous steps with the details below:

What does the goods export documents include?

The procedures for importing goods require exporters to prepare the following documents:

1. Customs declaration
2. Commercial invoice or document of equivalent value in case the buyer must pay the seller: 01 photocopy.
3. List of forest products for exported raw wood according to regulations of the Ministry of Agriculture and Rural Development: 01 original copy.
4. Export license or export permit issued by a competent authority according to the law on foreign trade management for exported goods subject to management under the license.
5. Notice of exemption from inspection or notice of specialized inspection results or other documents according to the provisions of law on management and specialized inspection (hereinafter referred to as Certificate of specialized inspection): 01 original.
6. In case the Specialized Inspection Certificate is used multiple times within the validity period of the Specialized Inspection Certificate, the company will only submit it once to the Customs Branch where the first batch of goods is exported.
7. In cases where specialized laws require submitting photocopies or do not specifically stipulate the original or photocopies, the company may submit photocopies.
8. Documents proving that the company is eligible to export goods according to the provisions of law on investment: submit 01 photocopy when completing export procedures for the first batch of goods.
9. Entrustment contract: 01 copy in case of entrusted export of goods that require an export license, specialized inspection certificate or documents proving that the company is eligible to export goods According to the provisions of investment law, the entruster uses the license or confirmation document of the entruster.

The demonstration of the goods exporting process

The process of exploring and importing goods consists of 10 steps:

Step 1. Negotiate and sign the contract

Step 2. Apply for an export license

Step 3. Make a booking and pick up an empty container

Step 4. Prepare export goods and check export goods

Step 5. Packaging, preparing shipping mark

Step 6. Buy shipment insurance

Step 7. Implement customs procedures

Step 8. Deliver goods to a ship

Step 9. Send the payment of goods

Step 10: Send documents to foreign buyers

Summary

Through this article, you have understood what exporting goods is and the basic steps to export goods. Your companies have also been guided through the advantages and disadvantages of each of the most popular exporting channels today. Any business that seeks advice on goods export services. Please contact Vietlinh Agrimex for the best support.