For many entrepreneurs, an import business sounds like an exciting way to make a mark in the world of business ownership.
The idea of traveling to exotic locales, selecting rare merchandise, and selling it in the U.S. has a powerful allure, especially for people who have a passion for road-less-traveled kind of business opportunities.
The rise of global commerce has fueled demand for talented importers in the U.S. and around the world. The Internet and other technologies have streamlined international communication and made it possible for importers to target a broader range of international products.
But setting up an import business isn't as easy as placing an order and picking up deliveries from a shipping dock. Importing has never been easy, but it's even more challenging in the post-911 global commerce environment. If importing is on your shortlist of potential business startups, here's the information you need to get your business off the ground.
Setting up an import business is the easy part. From a legal perspective, all that's required is an importer of record number (IRS number, EIN, Social Security number, or Customs assigned importer number) and a bond that guarantees payment of duties and taxes. But from a practical standpoint, you'll also need to established relationships with international suppliers and with customers in the U.S. Importing products without a U.S. buyer is the fast track to business suicide.
Managing Import Restrictions
The next step in starting an import business startup is to identify and research the kinds of products your company will import. Import restrictions vary from one category to the next. For example, food products, alcohol, biotech, and other types of products can be more challenging to import than simple wooden crafts. Information about specific products can be obtained through the U.S. Customs and Border Protection (CBP) department and from the embassy of your products' country of origin.
Navigating customs requirements is one of the trickiest aspects of an importing business. Most imported products require the completion of multiple documents before the merchandise can be received in the U.S. In 2009, CBP implemented an Importer Security Filing (ISF) requirement known as 10+2. This rule requires importers to transmit cargo information at least 24 hours before it is loaded for transport overseas. The rule was designed to make it harder for terrorists to import dangerous cargo into the U.S., but it has also made life more difficult for legal importers. To streamline customs requirements, many importers hire a customs broker to handle the filing of all customs-related documents for them.