Seeing your small business grow with you is a very satisfying process, but as all small-business owners know, the learning curve can be steep.
When we started Merchant’s Pantry, it was based on all things food and liquor that we loved. We thought if WE love these products, surely other people will too. We successfully learnt to procure yummy goodies locally, both from importers and local producers. But like most small business owners – and people in general – we have been suffering from wanderlust. Two years of Terra Australis (and limited, oft locked down Australis at that!) had us wanting to spread our wings internationally.
Enter the idea of bringing some of Switzerland to Australia. We decided on a product that is everyone’s darling at the moment: Gin. We found an amazing producer who created the original Swiss Gin – a gin that incorporates botanicals particular to the alps and expresses its origin. Seemed like an easy situation – right? Weeellll, maybe not so much!
Here are five things I learnt from importing the first time:
Communication is the key with pretty much any relationship in life and it holds true when importing. Remember, there is time zone differences, cultural differences and just plain old personality differences to take into consideration. Video Conferencing is your friend. Creating a relationship and getting to know your producer is still vital. The better you know them, the better the relationship can be. When you receive your samples, have a meeting with the supplier whilst you taste the samples, to discuss and go through things as you would in a normal meeting.
2. Shipping agents
A shipping agent is your key to a smooth importing process. Before choosing, ask them: Which ports do they use, can they organize land transport, their fees and shipping times. What requirements are there for pallets, product restrictions and customs duties. A shipping agent will have their own customs broker to help get your products released and help you navigate duties and fees, so choosing one who really knows their stuff and can do all this intricate work for you is crucial. This leads into the next point…
3. Do your maths
A good ol’ spreadsheet is your friend here. Know your costs. Set up columns so you can calculate the cost of goods (and currency conversion), GST, Duty, Excise and Freight. If you get this part as accurate as possible, you minimize any nasty shocks when the goods are landed. Work out your wholesale and retail pricing. This can all be calculated pretty simply by doing the homework at the start. Don’t fall in love with a product, import it and then realise you can’t sell it because your math is wrong (or non-existent).
4. Know your standards
Australia has strict labelling standards for food and beverage so whilst you can wait for the inspection on arrival and add on any missing information, it’s better to have compliant labels before products leave their country of origin. You also need to let the supplier know any requirements for pallets and packaging that Australia may have.
Whilst we had no issues with needing to claim insurance, this almost goes without saying, but make sure you get insurance. Your shipping agent can help but it is not automatically included in your agent’s fees, so shop around and make sure your butt is covered – especially with goods coming by sea.
Importing can be a great additional string to your business bow, but it’s not for the faint-hearted or the impulsive entrepreneur who falls in love with a product and then gets tunnel vision about having it. Do the research, do the numbers, and do it right.