A garment company has received an order to export 2,000 men's shirts to ABC imports Ltd. located in Chicago. Discuss the following steps (minimum six) of export procedure along with the documents involved in brief.
A garment company has received an order to export 2,000 men's shirts to ABC imports Ltd. located in Chicago. Discuss the following steps (minimum six) of export procedure along with the documents involved in brief.
Steps of export procedure are :
1. Receiving trade enquiry and sending Quotation : Trade procedure starts when an exporter receives trade enquiry in written form from the intending importer. In response to the trade enquiry, the exporter sends the quotation or a performa invoice containing necessary details regarding the detailed condition of sale as delivery schedule, mode of delivery, mode of packing, terms of payment and so on.
2. Receiving indent and sending confirmation: After receiving the quotation from the exporter, the importer sends indent which contains all the important particulars of the transaction such as a description of goods, their price, quantity, quality instructions regarding packing, marking, insurance, mode of payment, date and method of delivery etc. For buying goods and the exporter confirms its receipt.
3. Obtaining letter of credit : Before despatching the goods, the exporter assesses the credit worthiness of the importer. For this the import is requested to send a 'letter of credit' in favour of exporter. It contains an undertaking of importer's bank that bills drawn by the exporter upto a specified amount shall be honoured by the importer.
4. Obtaining export license and completing other formalities : For exporting goods from India exporters are required to obtain export license, import export code number, registration membership certificate, RBI code number and registering with ECGC.
5. Obtaining preshipment finance and production or procurement of goods : After receiving a letter of credit, the exporter obtains preshipment finance from his banker and starts manufacturing/procuring goods as per the specifications of the export order.
6. Pre-shipment inspection : Before shipment of goods, export Inspection council/authority inspects the quality of goods and if satisfied, issues export inspection certificate which certifies the quality of goods to be exported.
7. Excise clearance : Before exporting the goods, an exporter is required to get a certificate from concerned Regional excise commissioner indicating amount of excise duty levied on the raw materials to get the refund of excise duty.
8. Obtaining certificate of origin : To avail tariff concession in the country of the importer, the exporter obtains certificate of origin which is a proof that the goods are actually being manufactured in the country from where these are exported. This certificate can be obtained from trade consulates of exporter's country.
9. Reservation of shipping space : The exporting firm applies to a shipping company for booking a shipping space. On accepting this application the shipping company issued 'shipping order' which is an instruction to the captain of the ship to receive specified goods on board after customs clearance.
Steps of export procedure are :
1. Receiving trade enquiry and sending Quotation : Trade procedure starts when an exporter receives trade enquiry in written form from the intending importer. In response to the trade enquiry, the exporter sends the quotation or a performa invoice containing necessary details regarding the detailed condition of sale as delivery schedule, mode of delivery, mode of packing, terms of payment and so on.
2. Receiving indent and sending confirmation: After receiving the quotation from the exporter, the importer sends indent which contains all the important particulars of the transaction such as a description of goods, their price, quantity, quality instructions regarding packing, marking, insurance, mode of payment, date and method of delivery etc. For buying goods and the exporter confirms its receipt.
3. Obtaining letter of credit : Before despatching the goods, the exporter assesses the credit worthiness of the importer. For this the import is requested to send a 'letter of credit' in favour of exporter. It contains an undertaking of importer's bank that bills drawn by the exporter upto a specified amount shall be honoured by the importer.
4. Obtaining export license and completing other formalities : For exporting goods from India exporters are required to obtain export license, import export code number, registration membership certificate, RBI code number and registering with ECGC.
5. Obtaining preshipment finance and production or procurement of goods : After receiving a letter of credit, the exporter obtains preshipment finance from his banker and starts manufacturing/procuring goods as per the specifications of the export order.
6. Pre-shipment inspection : Before shipment of goods, export Inspection council/authority inspects the quality of goods and if satisfied, issues export inspection certificate which certifies the quality of goods to be exported.
7. Excise clearance : Before exporting the goods, an exporter is required to get a certificate from concerned Regional excise commissioner indicating amount of excise duty levied on the raw materials to get the refund of excise duty.
8. Obtaining certificate of origin : To avail tariff concession in the country of the importer, the exporter obtains certificate of origin which is a proof that the goods are actually being manufactured in the country from where these are exported. This certificate can be obtained from trade consulates of exporter's country.
9. Reservation of shipping space : The exporting firm applies to a shipping company for booking a shipping space. On accepting this application the shipping company issued 'shipping order' which is an instruction to the captain of the ship to receive specified goods on board after customs clearance.
