Selecting Products for Importation

One of the most important import decisions an exporter-importer must make is the selec­tion of the proper product that serves the market need. In the absence of such a product, one is left with a warehouse full of merchandise that no one is interested in buying. Nevertheless, importing can become a successful and profitable

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Determining Import Volume

Much of the literature on imports underlines the importance of high per capita incomes and population size in determining import levels. All other things being equal, countries with higher per capita incomes will be able to import more per person than countries with lower levels (Lutz, 1994). Larger countries (in terms of population) import

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Selecting the Import Supplier

The product selected for importation may be manufactured by several firms in different countries or within the same country. The next important step is to assess and select the right supplier on the basis of a number of critical factors, such as quality, delivery time and supplier reliability, transportation cost, import duty implications, protection

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Pricing the Imported Product

Knowledge of the price structure for imported goods makes it possible to determine the ap­propriate price to be charged for the merchandise. The price structure in Table 17.4 could be used as a general guide. Source: Seyoum Belay (2014), Export-import theory, practices, and procedures, Routledge; 3rd edition.

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Import Marketing Channels

One of the fundamental decisions for foreign suppliers is whether to sell their products directly or through intermediaries. Relying on an intermediary relieves the producer of in­ternational marketing activities. However, the producer forgoes part of the export profit and does not obtain firsthand information on the market, and this, in turn, may reduce the

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Financing Imports

Imports can be financed by using methods such as documentary collection, letters of credit, transferable letters of credit, or back-to-back letter of credit. Readers can refer to the section in Chapter 11 on the various types of letters of credit. Source: Seyoum Belay (2014), Export-import theory, practices, and procedures, Routledge; 3rd

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International Sourcing

The outsourcing of products and services to external suppliers continues to expand, as firms search for ways to lower costs while improving their products to remain competitive. By the end of 1998, it is estimated that U.S. companies had spent more than $100 billion on outsourcing. Outsourcing is commonly used by firms in the

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The ATA Carnet: Unlocking Customs for Temporary Entry of Goods

The ATA Carnet is an international customs document used by travelers to tem­porarily import certain goods without paying tariffs or going through customs formalities. The term “ATA” stands for the French words “Admission Temporaire.” It is created by an international convention to promote world trade and can be used in more than ninety countries.

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Maytag’s Triad Strategy

Firm strategy plays an important part in determining the competitiveness of an industry in a global market. As governments embrace trade liberalization, local industries have become increasingly exposed to fierce competition from a grow­ing array of international suppliers. Domestic producers of bulk appliances like dishwashers and refrigerators were largely insulated from foreign competition be­cause

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The Entry Process for Imports

1. Filing Entry Papers The entry process requires filing the necessary documents to enable customs to determine whether the merchandise may be released from its custody, as well as for duty assessment and statistical purposes. Both of these processes can be accomplished electronically via the Automatic Broker Interface Program. What are entry documents? Entry

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The Harmonized Code (HS Code)

The HS code is a harmonized commodity description and coding system that is used for classifying traded products. The Harmonized System was developed under the auspices of the World Customs Organization (WCO), with the active participation of governments and private organizations. Since entering into force on January 1, 1988, the HS has been partially

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Customs Valuation

In 1979, the United States adopted the customs valuation system that was the result of the Tokyo Round negotiations of the GATT. Valuation of a product is important because most imported products are subject to tariffs based on the percentage of the value of the import (ad valorem rate). It also helps countries to

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Rules of Origin and Other Marking Requirements

Imported articles are to be marked with the name of the country of origin to indicate to the ultimate purchaser the name of the country in which the product was manufactured. The ultimate purchaser is generally the last person in the United States who will receive the article in the form in which it

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Deemed Liquidation by Customs

Koyo Corporation of USA (Koyo) imported roller and ball bearings for resale in the United States. At the time of entry, antidumping duty orders issued by the De­partment of Commerce were in effect. The orders required duty deposits to cover estimated antidumping duties between 48 and 74 percent ad valorem. Liquida­tion of the entries

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Product Classification

Better Home Plastics Corp. (BHP) imported shower curtain sets that consisted of an outer textile curtain, an inner plastic magnetic liner, and plastic hooks. While the textile curtain is semitransparent and decorative, the inner liner also matches the curtain and adds to the set’s decorative appearance. The sets are sold to retailers at prices

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Import Relief under the WTO

The WTO’s most-favored-nation principle provides for equal treatment of goods and ser­vices from all member countries. This principle of nondiscrimination, however, is subject to certain exceptions: A. Unfair imports Actions taken against dumping (selling at an unfairly low price) Subsidies and special “countervailing” duties to offset the subsidies B. Fairly traded imports Emergency measures

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Unfairly Traded Imports

1. Antidumping Actions The WTO’s Antidumping Agreement governs the application of antidumping (AD) mea­sures by WTO member countries. A product is considered to be “dumped” if it is exported to another country at a price below the normal price for a like product in the exporting country. Antidumping measures (the imposition of antidumping duties

Fairly Traded Imports

The WTO’s safeguards agreement establishes rules for the application of safeguard measures by WTO member countries. A safeguard is a temporary import restriction (e.g., a quota or tariff increase) that a country is allowed to impose on a product if imports of that product are in­creasing to an extent that causes or threaten to

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U.S. Import Relief to Domestic Industries

The U.S. trade policy is based on combating unfairly traded imports. There are regulations in place to provide relief to domestic producers that are adversely affected by imports that benefit from government subsidies in home countries or are dumped at low prices in the U.S. market. The U.S. rules are largely consistent with the

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Antidumping and Countervailing Duties

U.S. antidumping and countervailing duty laws have been subject to several changes over the years; the most recent amendments were to implement the Uruguay Round Agreements of the GATT. An important effect of the agreement is that it has reduced the discretion previously available to the administering authorities by imposing strict statutory time limits.

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