After struggling for months, your hardwork has finally paid off and you have recevied your first order. But to keep the momentum going, it’s essential to make this first delivery a success. Here’s how:
Confirm if the product specification is the same as what you deal in and check if – the importer requires additional documentation, any specific packing, labelling and marking requirements or other compliance requirements of the destination country.
There should be no discrepancy between the terms of the export order and the ones offered by you in your proforma invoice/contract.
You should get an idea of how big the order is and whether you can deliver it within the required time.
Find out who is responsible for the insurance of the consignment.
Read through the payment terms and ensure they are as per your suitability.
After a full rundown of the order, go ahead and confirm your acceptance to the importer. In case any clarification or renegotiation is required, try to close it at the earliest.
Post your confirmation to the importer, you will have to get your product or service ready. Ensure that the production process is fast enough to honour the timeline of the order. You might also be interested in government schemes that address the pre-shipment working capital needs of the Indian exporter. For example, the MSME exporter’s subsidy was raised from 3% to 5% last year under the “Interest Equalisation Scheme on Pre and Post Shipment Rupee Export Credit”.
Once your goods or services are ready, get your paperwork with Central Excise in place. Exporters can pay excise duty under a claim of rebate and clear the goods without examination, after preparing the application form ARE-1. Alternately, goods may be passed at Central Excise level with the examination. Manufacturer exporters can also execute a bond/letter of undertaking for the duty amount, instead of paying the duty.
After the sign-off by the Superintendent of Central Excise, the Customs examines the goods. They then issue an Inspection Certificate in triplicate (for the importer, the exporter and the Customs). The examination can be done consignment wise, in-process quality control and self-certification.
Thereafter you have to appoint a C&F agent who will take care activities like packing, labelling and marking of consignment, transport arrangement, customs clearance and other in-transit and port documentation.
Space is reserved for the goods with the shipping company, which then issues a Shipping Order. This reservation can be done directly with the company, through a C&F agent or a freight broker. At this stage, you will also get the goods insured. Loading to the railway is done based on documents like a Forwarding Note, Shipping Order and Wagon Registration fee receipt. After loading, the railway issues a Railway Receipt, which is sent to the C&F agent.
The C&F agent receives the goods and stores them in the warehouse. In order to get customs clearance and bring the goods to the shipment shed, the C&F agent will furnish documents like the Shipping Bill, Contract Form, Letter of Credit, Commercial Invoice, GR Form, Inspection Certificate, AR4/AR4A form and Packing List to the Customs House.
After the shipping company provides the Bill of Lading to the C&F agent, you will receive the following documents - Commercial Invoice (attested by the customs), Drawback Copy, Export Promotion Copy, Clean on Board Bill of Lading, Gate Pass and AR4/ AR4A, Letter of Credit, , and the GR Form (duplicate). Based on these, you can now apply for the Certificate of Origin from the Chamber of Commerce.
You then need to send the Shipment Advice to the importer, which will inform him of the date of shipment and expected date of arrival. You will also have to send the Bill of Lading (non-negotiable copy), Commercial Invoice, Packing List and Customs Invoice to the importer to facilitate receipt of the consignment.
You will then submit a host of documents to your bank for realising the amount due from the importer. These documents include
With this, your first order handling process is almost complete, and you can proceed to claim the export incentives applicable to you.