Receipt of an inquiry: The first stage in the export trade is the receipt of an inquiry by the

exporter forms an importer or his agent. An inquiry is a written request by a prospective importer
regarding the quantity, quality, design, price, mode of payment, etc., of goods, which he intends
to purchase.

Sending quotation: In reply to the inquiry, the exporter sends a quotation (or Proforma invoice)
in which all necessary details are given as required by the importer. The type for price quotation
depends upon the inquiry of the importer.

Receipt of an indent (or order): In case the importer is satisfied about the quotation from the
exporter, he will send an order (or indent) for the supply of goods. The exporter should carefully
check indents begin received from the importer, so that all necessary details of the goods, its
packing, bank guarantee, payment, etc., are clearly mentioned.

Assessing importer’s creditworthiness: After receipt of the indent, the exporter makes

necessary enquiry about the creditworthiness of the importer. The purpose underlying the
enquiry is to assess the risks of nonpayment by the importer once the goods reach the import
destination. To minimize such risks, most exporters demand a letter of credit from the importer.
A letter of credit is a guarantee issued by the importer’s bank that it will honour payment up to a
certain amount of export bills to the bank of the exporter. Letter of credit is the most appropriate
and secure method of payment adopted to settle international transactions

Obtaining export licence: Having become assured about payments, the

Exporting firm initiates the steps relating to compliance of export regulations. Export of goods in
India is subject to custom laws which
Demand that the export firm must have an export licence before it proceeds with exports.
Important pre-requisites for getting an export licence are as follows:
• Opening a bank account in any bank authorised by the Reserve
Bank of India (RBI) and getting an account number.
• Obtaining Import Export Code (IEC) number from the Directorate

Obtaining pre shipment finance remaining

Production or procurement of goods:-

Once export contract is confirmed, exporter has to arrange manufacture of goods meant for
export, if they are not readily available. In case, there are production constraints, priority is to be
given for exports as timely delivery is the most important criterion in case of exports and, if
necessary, certain rescheduling of production for meeting indigenous requirements may have to
be made. If the goods are not to be manufactured but are to be procured from the local market,
necessary action has to be initiated to meet the delivery schedule.

If exporter is a manufacturer, a detailed plan of action is to be drawn as manufacturing process is

not as simple as procuring finished goods. The details of inputs required for production should be
presented in the form of a document called Bill of Materials. The manufacturer/exporter has to
prepare backward pass calculations to ascertain the time Schedule of requirement of materials.
For calculating this, it is desirable to leave a margin of ten to fifteen days to the date of shipment
of goods to face unforeseen contingencies. It is also prudent to plan for labelling, packing and
packaging, simultaneously. A careful cost and time schedule and their periodical review are
essential meet the deadline date delivery schedule and achieve the anticipated level of profits.

Pre shipment inspection:-

A pre-shipment inspection (PSI) is a random inspection comprising a detailed inspection
of finished goods before shipment. It generally takes place in the manufacturer’s
premises or at the harbour on samples randomly selected according to the defined
statistical sampling procedure ISO 2859-1 or otherwise agreed with the customer. The
inspection criteria may cover type identification, product conformity, safety, function,
marking and safety hints, quality (consistent workmanship), quantity, packaging, unit
completeness and compliance with the agreed specification.

Excise clearance:-
An indirect tax levied on goods manufactured or produced in India for home consumption.
Goods subject to excise duty can leave the factory only after the duty on them has been paid.
Excise duty exemption is available on inputs as well as finished goods manufactured in India
and exported.
The exporter may pay the duty initially and seek refund later or seek exemption from payment
of duty.

Origin:-
To qualify for preferences, products must: (a) fall within a description of products eligible for
preferences in the country of destination. The description entered on the form must be sufficiently
detailed to enable the products to be identified by the customs officer examining them; (b) comply with
the rules of origin of the country of destination. Each article in a consignment must qualify separately in
its own right; and (c) comply with the consignment conditions specified by the country of destination. In
general, products must be consigned direct from the country of exportation to the country of
destination but most preference-giving countries accept passage through intermediate countries subject
to certain conditions. (For Australia, direct consignment is not necessary
Reservation of shipping space:-

As soon as confirmed export contract is received from the importer, exporter has try make the

necessary arrangements for shipping Space. The exporter has to make the necessary reservation,

in case goods are to be sent by sea. The reason is there is shortage of shipping space and equally

their frequency is also limited. Exporter has to gather information about the sailings for the port of

destination, matching the delivery schedule. Necessary information can be gathered from Daily

Shipping intelligence to which exporters may subscribe. Shipping agents work on behalf of the

shipping. Companies who can be contacted too about the availability of the required space to match

the schedule of delivery, at economic cost. Clearing and Forwarding agents are the specialized

people in this line of activity who can be appointed. Exporter sends the cargo to the clearing and

forwarding agents who take care of shipment of goods. In case, goods are to be sent by air, the

problem is not that difficult as there are adequate airlines for booking the cargo.

There are two kinds of acceptance in case of shipment by sea, Shipping Advice and Shipping Order

(Dead Freight). Shipping advice is only an intimation by the shipping company to the exporter that

the goods would be accepted on the ship if there is availability of space on the ship. In this case,

shipping company is not bound to accept and there is no commitment at the part of shipping

company to provide space on board. Exporter would be running the risk if there is no space soon

after the goods are sent for shipping and may not be able to send the goods as per delivery

schedule. Where delivery schedule is not important, exporter can book on this basis which is not,

normally, the case in exports. Shipping order, on the other hand, is a total commitment on the part of

shipping company to provide the space on board and reserves the area for that exporter to whom

commitment is made. If shipping company fails to provide the shipping space after issuing shipping

order, shipping company can be sued for damages. As and when shipping order is issued to the

exporter, shipping company sends a copy of shipping order to the commander of the ship for

earmarking the space to the exporter.

Packing and forwarding:-

Package forwarding is an international shipping service offered by shipping companies to
international online shoppers who want to do cross-border online shopping. Package forwarding is
becoming more and more popular among international shoppers nowadays because of the high
growth rate of e-commerce websites and shipping limitations of most such websites.[1] Package
forwarding service is provided by package forwarders to make cross-border shopping convenient
and easy, getting rid of the problems in payment and shipping. A package forwarding service is
different from mail forwarding. Mail forwarding refers to the mails in traditional meaning, or
magazines or papers that are normally called mails, while package forwarding refers to the online
purchases or orders that are shipped within a package.

Insurance of goods:-

Custom clearance:-
The documented permission to pass that a national customs authority grants to imported goods so
that they can enter the country or to exported goods so that they can leave the country. The custom
clearance is typically given to a shipping agent to prove that all applicable customs duties have been
paid and the shipment has been approved
Customs clearance involves preparation and submission of documentations required to
facilitate export or imports into the country, representing client during customs
examination, assessment, payment of duty and co taking delivery of cargo from customs
after clearance along with documents.

Some of the documents involved in customs clearance are:

1. Exports Documentation: Purchase order from Buyer, Sales Invoice, Packing List,

Shipping bill, Bill of Lading or air way bill, Certificate of Origin and any other specific
documentation as specified by the buyer, or as required by financial institutions or LC
terms or as per importing country regulations.

2. Imports Documentation: Purchase Order from Buyer, Sales Invoice of supplier,

Bill of Entry, Bill of Lading or Air way bill, Packing List, Certificate of Origin, and any
other specific documentation required by the buyer, or financial institution or the
importing country regulation.

The rules, regulations, and laws are a bit different from country to country, sometimes
from port to port within a country, making someone who specializes in customs
clearance very important to a shipper exporting and importing goods.

These specialists are called customs brokers and the work they do is called customs
brokerage or sometimes customs broking.

Shipping containers are warehoused as they go through customs clearance.

Warehousing and storage fees can add up quickly. If there is a problem with your
customs brokerage and your customs clearance does not happen smoothly, your
shipping costs could go up.

On top of these costs, the delay in getting your shipping containers released to you
because of customs clearance problems could cost your business more money because
the arrival of your shipment is delayed.
Your freight forwarder should also be able to handle your customs clearance, but you
can choose to handle it separately with your own customs broker.

When choosing a freight forwarder, you want a company with the experience to handle
your customs clearance well and who knows what to do should any issues arise.

For these reasons, going with the cheapest freight forwarder you can find to handle your
international shipping can turn out to be much more expensive than hiring a freight
forwarder with a little higher quote but who has much more experience in the business.

There are other things you can do to help ensure your shipping containers make it
through customs smoothly.

Here are 2 ways you can help make the customs clearance process smooth for your
shipment.

 Properly Load Your Shipping Container

 Provide Complete and Accurate Information to Your Customs
Broker/Freight Forwarder

Obtaining mates receipts:-

A document issued by the carrier to the shipper, indicating receipt of the goods, but not loading on
board. Like a Bill of Lading B/L, a mate´s receipt can be either clean or claused/dirt/foul, depending
on whether or not the goods have been received in apparent good condition The mate´s receipt can
later be exchanged for the bill of lading. Mate´s receipts are used only for charter shipments.
Shipments made on liner terms (where the sip line handles vessel loading an unloading) are covered
by dock receipts signed when de goods are delivered to the ship lines terminal.

Payment of freight and issuance of bill of lading:-

A bill of lading (sometimes abbreviated as B/L or BoL) is a document issued by a carrier (or

their agent) to acknowledge receipt of cargo for shipment. In British English, the term relates to ship
transport only, and in American English, to any type of transportation of goods. [Citation needed]
A bill of Lading must be transferable, [1] [2]
 and serves three main functions:

 it is a conclusive receipt,[3] i.e. an acknowledgement that the goods have been loaded; [4] and
 it contains or evidences[5] the terms of the contract of carriage; and
 It serves as a document of title to the goods, [6] subject to the nemo dat rule.
Bills of lading are one of three crucial documents used in international trade to ensure
that exporters receive payment and importers receive the merchandise.[7] The other two documents
are a policy of insurance and an invoice.[8] Whereas a bill of lading is negotiable, both a policy and an
invoice are assignable.
In international trade outside of the USA, Bills of lading are distinct from waybills in that they are not
negotiable and do not confer title.