In India, the Make in India movement launched by the Modi government has seen favourable changes in imports and as well as exports. In FY 2017-18, Indian exports increased by 9.98 per cent. The total value of goods exported in the year 2016-17 was $ 275,852 million, while in the FY 2017-18, the exports increased to $ 303,376 million.
In consideration of the current economic scenario of the country, starting an export business can be extremely profitable. Discussed below is a step-by-step guide to starting an export business in India-
- Establishing an Organization – The first step is to set up a company, proprietary concern or a partnership firm so that there is a business setup to work with. Choose a suitable name and logo, that is comprehensible in the international market.
- Opening a Bank Account – Open a current account with a bank that is authorized in Foreign Exchange.
- Obtaining Permanent Account Number – It is mandatory for all businesses participating in international trade to obtain a Permanent Account Number (PAN) from the Income Tax Department.
- Obtaining IEC Number – An Importer-Exporter Code (IEC) is a 10-digit number which is issued against the PAN from the Regional Authority of the Directorate General of Foreign Trade (DGFT). IEC number is mandatory for businesses to operate with the import and export of goods.
- Obtaining the RCMC – A Registration cum Membership Certificate (RCMC) is essential for availing benefit or concession under the Foreign Trade Policy 2015-2020. In addition to this, an RCMC also gives the exporters the access to services and guidance by the concerned Export Promotion Councils, Community Boards, and other respective authorities.
- Product and the Market – Before deciding products and their destination countries, make sure that it is not listed under the prohibited or restricted list of the concerned authorities. Decisions should only be made after understanding current export trends, market size, competition, and other factors.
- Finding Buyers – Explore prospective buyers through trade fairs, buyer-seller meets, exhibitions and B2B portals. Seeking help from Indian Mission Abroad and Indian Chamber of Commerce are other ways of finding buyers.
- Sampling – Establish brand authenticity by providing customized samples in accordance with the demands.
- Pricing/Costing – Take into account all expenses incurred from production to marketing, Offer the best quality products at competitive prices, with a maximum profit margin. To ensure successful deals, be open to negotiations.
- Covering risks through ECGC – The Export Credit Guarantee Corporation Limited (ECGC) covers the risks associated with international trade. The ECGC policies cover exporters against non-payment by the buyers.
The current economic scenario is conducive to export businesses in India. Make the most of it by intelligently participating in International Trade. This will not only open up new avenues for business but also for the country.