What nobody tells you on day one
Exporting is not selling further away: it is selling with more people in between. Between your warehouse and your customer’s there is a freight forwarder, two customs authorities, a bank and, with luck, an insurer. Each one asks for a document, charges something and has its own deadlines. None of it is hard on its own. What is hard is the order.
Most problems on a first order are not knowledge problems: they are sequence problems. A price is quoted before anyone knows what it costs to put the goods there, an Incoterm nobody has read gets accepted, the truck is loaded before payment terms are closed. When that happens the order is not lost: it is won at a loss, which is worse because nobody sees it.
This guide is the sequence. Nine steps, in the order they actually happen. Each one says what you decide and what is not up to you, which is the other half of the information that tends to be missing.
The nine steps of a first order
Top to bottom. You can go back, but skipping one forward always costs money.
- Know what you sell in customs termsYour product has a number: its tariff heading. The duty your customer pays, the paperwork they will be asked for and the trade data you can look up all hang off it. Without it you can neither price nor pick a market, so it comes first. You classify it, and you answer for it: the code your supplier uses does not have to be yours.
- Choose the country, do not just accept itMost first exports start with an email that arrived on its own. Answering it is fine; building on it is not. Before you spend a year on a market, look at how much of your heading it imports, at what average price and what barriers it has. A country that imports a lot has demand, which is not the same as having room for you.
- Check you can get inBarriers before price. Three questions: does your product need registration, certification or its own labelling there? Is there a trade agreement with the EU that lowers your customer’s duty? Are the consignee or the destination on any sanctions list? All three can be answered in an afternoon and all three can cancel the whole thing.
- Work out the landed costYour ex-works price is not your price there. On top go inland haulage, clearance, freight, insurance, import duty, VAT or its local equivalent and every channel margin. The same product easily costs twice as much on the shelf. This number is calculated before quoting, not after the customer says it is expensive.
- Choose the IncotermThree letters that split who pays what, where your risk ends and who handles each customs clearance. It is not a detail of the quote: it is half the quote. On a first sale, something in between and well understood — FCA or CPT — usually protects you better than an EXW that leaves you outside the transaction or a DDP that makes you the importer in a country whose rules you do not know.
- Make the offer: the proforma invoiceThe proforma is the formal offer. It is not an invoice and does not go in the books, but it is the document your customer uses to request financing, apply for a licence or open a letter of credit. It carries price, Incoterm with its place, currency, validity, lead time and payment terms. Without those five it is not a comparable offer: it is a loose price.
- Close how you will get paidBefore producing, not after loading. On a first order with a customer who has no track record, the norm is full or partial payment in advance, or a letter of credit if the amount justifies it. The rule that avoids trouble is simple: never lose control of the goods and control of the payment at the same time.
- Prepare the shipment and its paperworkNow the forwarder comes in. They book, you document: commercial invoice, packing list, proof of origin if there is an agreement, and whatever that destination specifically asks for. The golden rule is that all three documents say exactly the same thing — same packages, same weights, same descriptions — because whoever compares them at destination does not have your emails, they have the papers.
- Clear, ship and keep the proofCustoms validates the export declaration and, when the goods leave, issues the exit confirmation. That document is what justifies invoicing without VAT. File it with the operation, next to the transport document and the proof of payment: if there is ever an inspection, that folder is what gets reviewed.
Who decides what
Half the arguments on a first order come from not having this clear. Useful to remember when the buyer pushes.
| Decision | Who rules | How much room you have |
|---|---|---|
| Tariff heading | You, and you answer for it | None: it is what it is. Justified by the product description. |
| Incoterm | Negotiated | A lot. It is where you can concede most in exchange for price or payment terms. |
| Payment terms | Negotiated | A lot on the amount, little on the principle: with no track record, no open credit. |
| Freight forwarder | Whoever pays the freight under the Incoterm | If it is yours, choose it. Always ask two quotes with the same scope. |
| Product requirements | The destination country | None. Either you comply or the goods do not enter. |
| Import duty | The destination country | Only through origin: if there is an agreement and you can prove it, it drops or disappears. |
Before sending your first quote
If any box is unticked, the quote that goes out will cost you money.
- I have my product’s tariff heading and I know where it came from
- I know what duty my customer pays there and whether an agreement lowers it
- I have checked my product can enter: registrations, certificates and labelling
- I have calculated the landed cost, not just my ex-works price
- I have chosen an Incoterm and I know exactly where my risk ends
- I know how I will be paid and what happens if the customer does not pay
- I have asked a forwarder for transit time and price, not estimated them
- My quote carries validity and currency, so the exchange rate does not eat the margin
The mistakes that keep repeating
- Quoting EXW because “it is simpler”EXW leaves the buyer doing your export clearance in your country, a formality that belongs to an established exporter. Many EXW deals end in an administrative mess or in an export you cannot evidence as such.
- Giving a delivery date without asking the forwarderReal transit times include pickup, consolidation, weekly sailings, transit and clearance at destination. What gets promised from memory is usually two weeks off what happens.
- Invoice, packing list and transport document not matchingIt is the number one cause of held cargo. Customs at destination compares all three and any difference in weight, packages or description opens a check.
- Treating proof of origin as one more piece of paperIt is what makes your customer pay less duty, and what their customs can review years later. If you issued it without meeting the origin rule, you are the one who answers.
- Invoicing in foreign currency with no validity on the quoteNinety days can pass between quoting and getting paid. A five per cent move in the rate takes a whole margin with nobody having done anything wrong.
What to do this week
If you have never exported, the order to start today is this: classify your product, look at who imports it, and call a forwarder for an indicative price to the two or three destinations that come up. With those three things you can build a real cost breakdown, and with a real breakdown you can talk to a buyer without gambling.
The rest — the contract, the insurance, the currency hedge — gets sorted when there is an order on the table. Starting there is the most common way of never starting at all.