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How do I …become an importer?

Reported by Anthony O'Brien
Wednesday, June 25, 2008
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By Anthony O'Brien,
Money Magazine
, June 2008

Australia imports more goods than it exports. The latest data from the Australian Bureau of Statistics (ABS) shows that our trade deficit blew out by 30 percent in February 2008 to $3.29 billion.

The simple reason is that apart from mining, wheat, wool and sugar, Australia doesn't produce very much. Yet we are big consumers, which is excellent news for businesses with foreign products to sell.

Any pitfalls?

A business will generally import a product if it's unavailable locally or unmistakably different or cheaper than the home-grown competition. However, importing isn't cheap or without its share of red tape.

Transport costs can run into thousands of dollars depending on the imported product, number of units, weight and mode of travel. According to international freight company DHL, a one-tonne shipment delivered door-to-door from London to Sydney by air freight will cost over $10,000.

It takes six to seven days to arrive. But if a business can wait 45 days for a boat, the charge is under $1000.

Arriving in Australia the imported wares will be hit with customs charges, other government duties and insurance costs. And the pile of paperwork can involve a serious time investment.

That said, for a fee a customs broker can deal with the Australian Customs Service (ACS) and Australian Quarantine and Inspection Service (AQIS). Paul Zalai, freight and business operations manager, Customs Brokers & Forwarders Council of Australia, says a broker's fee is less if an importer only wants border clearance (including Customs and Quarantine requirements). "It will be more if a service delivers freight from the terminal or airport to the warehouse," he says, adding: "A freight forwarder can usually get a bulk discount from a shipping line or airline, which they can pass onto an importer."

Some goods are prohibited or restricted. For example, antibiotics, cigarette lighters, some cosmetics and even Fijian kava have restrictions. The Customs Information and Support Centre (CISC) provides a more extensive list and can be contacted on 1300 363 263.

How do you do it?

Given the costs and red tape, it's always best to try to find a supplier in Australia. If this search proves fruitless, first try to identify a county or group of countries where the product might be available.

Unfortunately Austrade won't be much help as it’s focused on exporters. Importers will need to look elsewhere.

For example, a friend of mine considering importing machinery from China made a few calls to find out how he could uncover some suppliers. Austrade suggested the Chinese Embassy, which duly sent some paperwork asking questions about the owners, the business and its broad objectives. The embassy then attempts to match the importer with suppliers. Chambers of commerce and industry associations can also deliver overseas contacts.

The next step involves identifying the regulations that may affect the border clearance of your products. A government review of Australia's quarantine and biosecurity systems is considering issues such as animal and plant risk assessments, targets for quarantine intervention plus import inspections and certification.

The report is expected by the end of September. For more information visit www.quarantinebiosecurityreview.gov.au.

The costs

Some experts suggest importers meet with a supplier from the outset, so airfares and accommodation should be factored into the cost of importing.

Once you've secured the products, there are transport costs, customs clearance fees and duties as well as insurance and GST (see table). The calculation of these charges can be complicated and depends on a range of variables. For examples of fees and costs involved check out this month’s Money magazine.

Money Magazine's June 2008 issue is out now. Subscribe now.

18/09/2014 17:40Sydney, Australia. 18 September,2014
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