Export procedures and documentation

These are early procedures which include:

1. Entering into export contract: Importer and exporter have to agree on some terms and conditions then sign the contract.
2. Receiving an inquiry: The intended exporter receives a written request from a foreign buyer for information regarding the price and all other description on the goods he wants to buys example quality, quantity, features, time and methods of delivery and payments.
3. Sending a quotation: The intended exporter sends a document giving descriptions on the goods to be sold.
4. Receiving indent: After receiving quotation a foreign buyer (if satisfied with terms of sale) makes order by sending indent to the exporter. An indent is an International order which states the exactly details of the goods required, date of delivery, shipment instructions methods of setting debs.
5. Applying and obtaining export license or permit: Some products require specific permit from the Government departments, institutions or controlling body legally empowered to provide license which allow the exportation according to set government conditions.
6. Demanding a letter of credit: The exporter should demand a letter of credit from the importer, this letter of credit assures the payment from the importer.

After the exporter is satisfied with credit worthiness of the intended importer he makes arrangement for the shipping of goods.

Arranging for shipping goods: Due to complication in the shipping the goods as per formalities are concerned, exporters can decide to employ the clearing and forwarding agents. The shipping of goods arrangements includes the following formalities:

1. Application for Customs Permit from the Customs Office The exporter applies for a customs clearance permit, which is required before goods can legally leave the country.
2. Booking Space in a Ship for Carrying Goods The exporter (or agent) contacts a shipping company to reserve space for the goods on a cargo vessel.
3. Issue of Shipping Order Once terms and conditions of shipment are agreed upon, the shipping company issues a shipping order this is a document confirming the contract between the exporter (or agent) and the shipping company.
4. Attending Various Customs Formalities The exporter or agent must complete all necessary customs procedures, such as inspection and verification of goods, payment of duties (if applicable), and submission of required documents.
5. Placing Goods on the Dock (Quay) After customs clearance, the goods are physically moved and placed at the dock, ready for loading onto the ship.
6. Receipt of the Goods by the Ship Captain or His Assistant The ship's officer receives the goods and issues a mate's receipt, which is a temporary acknowledgment of goods received for shipment.
7. Sending Documents to Importer to Allow Him to Collect the Goods The exporter sends important shipping documents (e.g., bill of lading, invoice, packing list, certificate of origin) to the importer. These allow the importer to claim the goods at the destination port.

The exporter secures payments in settlement of the transactions in one of the following ways of financing foreign trade:

Exporter shipment procedure

1. Bill of exchange. A written order by the exporter (drawer) directing the importer (drawee) to pay a specified sum either on demand or at a future date. It helps the exporter secure payment.
2. Letter of Credit The exporter ensures payment by getting a letter of credit (L/C) issued by the importer's bank. This guarantees that the bank will pay the exporter once the required shipping documents are presented.
3. Documentary credit. This is a type of letter of credit where payment is made only after the exporter submits specific documents (e.g., bill of lading, invoice). It provides security to both exporter and importer.
4. Documentary bill. A bill of exchange accompanied by shipping documents, which gives the exporter control over the goods until payment or acceptance is made by the importer.
5. Bank draft. This is a written order by one bank directing another bank to pay a specified amount to the exporter. It is a safer payment method and often used in international trade transactions.