China Wholesale Secret

Copyright © 2006 by Early to Rise All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic, or mechanical, including photocopying, recording, or by any information storage and retrieval system, without permission in writing from the publisher.

Published by: Early to Rise 245 NE 4th Avenue, Suite 201 Delray Beach, FL 33483 Phone: 1-866-565-1117 Canadian and Global Customers: 1-203-699-2995 Web site: www.earlytorise.com Email: [email protected]

China Wholesale Secret Program Start Your Own Internet Import/Export Business OVERVIEW Chapter 1: The Multi-Trillion Dollar Import/Export Market ..................................................................1 Chapter 2: Benefits of an Internet Import/Export Business ..............................................................4 Chapter 3: Hot New Rising Trends ........................................................................................................6 Chapter 4: The Most Powerful Import/Export Website on the Internet for Entrepreneurs ....12 Chapter 5: Google and other Monster Traffic Generators..............................................................17 NUTS AND BOLTS Chapter 6: Nuts and Bolts of an Online Import/Export Business ................................................30 Chapter 7: How to Determine Which Products to Import/Export ................................................35 Chapter 8: Obtaining Products from Overseas Manufacturers for the Wholesale Market ....37 Chapter 9: Reselling Products on the Internet ..................................................................................41 Chapter 10: Wholesaling Products to Retailers................................................................................46 Chapter 11: How to Become an Import/Export Middleman ..........................................................50 MARKETING Chapter 12: Dominating Internet Search Engines and Directories ..............................................53 Chapter 13: Powerful Linking Strategies ............................................................................................58 Chapter 14: Buying Keywords and Phrases on Search Engines..................................................62 Chapter 15: The Secrets of Effective Online Advertising ..............................................................67 Chapter 16: Reselling Imported Products with Online Classified Ads........................................71 Chapter 17: How to Build and Market eStores “On Demand” ......................................................74 ACTION PLAN Chapter 18: Fast Start Strategy — Completing Your First Deal ....................................................78 Chapter 19: Growing Your Business for Even Bigger Profits........................................................86 Chapter 20: Importing and Exporting Billionaires ............................................................................90 Chapter 21: Focus on One Product at a Time ..................................................................................93 ADDITIONAL RESOURCES Chapter 22: Trade Resources................................................................................................................98 Chapter 23: Forms, Contracts and Agreements ............................................................................105 Terminology ............................................................................................................................................120

INTRODUCTION

Introduction Dear Entrepreneurs: We’re pleased to present to you this comprehensive import/export business kit. Congratulations for making the decision to learn about and launch this fascinating business. Rest assured — you’ve made the right decision! This business is NOT a passing trend that will be obsolete in a couple of years from now. The import export market is a multi-trillion dollar market — and it’s growing by leaps and bounds every day. On top of that, there has never been a better time to get into this business — what is more, the Internet has made it easier than ever. Just imagine what the great importing tycoons of times past could have done with the Internet. My guess is they would have been thrilled! This kit is packed with up-to-date information to help you get started quickly and easily. More important, this kit is designed to enable you to start making money immediately! There will be a tendency to skip through the kit and grab only the information that appeals to you at the moment. I know you want to start importing and exporting products as soon as possible. And we’ve designed this kit so you can get started making money quickly. But please take the time to read, study and review this information with as much focus as is humanly possible. The benefits for doing that will manifest itself for months, years and decades down the road. We’ve also designed this import/export business kit much like the Egyptians did when they built the great pyramids. We’ve laid a strong foundation so you can build your import/export business as large or as small as you want. But regardless of the size and scope of your venture you will have a firm foundation on which to build. By the way, you could search the Internet for a lifetime and you would never find all of this information in one place. In addition, we’ve consulted with many of the greatest business minds, entrepreneurs and

INTRODUCTION import/export gurus on the planet with a view toward developing THE BEST IMPORT/EXPORT BUSINESS KIT THAT MONEY CAN BUY. We spared no expense in showing you all of the pitfalls that beset most entrepreneurs that get involved in the import/export market. The hardest part of an import/export business is finding products that have the greatest demand. But we’ve made it easy for you. This kit contains all of the hottest products and markets on the market today. What’s more, we’ll show you HOW to identify and contact hundreds of companies that need products immediately! Importing and exporting is the largest marketplace in the world today. Imports to China will be more than $1.5 trillion in 2006 — that’s trillion. More important, the Chinese import market is still in its infancy. And China isn’t the only show in town… There are more than 195 countries in the world today, many looking for products that you can provide. Granted, boarders change on a daily basis. But there are a lot of countries that NEED products and are willing to pay for them. For example: 

Japan’s imports from the U.S. increased to more than $12 billion in 2005.



U.K.’s imports were more than $4 billion.



Brazil’s imports were more than $1.5 billion.

If you think that’s great — then you’ll love this: You can import products and sell them on the Internet… all from your own home. This kit shows you all of the “nuts and bolts” of importing products and reselling them on the Internet. Your importing or exporting business can be up and running in a matter of hours. You don’t even need a website or ecommerce to make it work! In addition, this kit includes a section on Internet search engines, keywords and linking strategies.

The import export market is a 24-hour windfall of cash You’ll learn about the hottest import export website on the Internet. They boast more than 1.7 million active members — most of whom are entrepreneurs just like you. The benefits of importing and exporting are too numerous to mention here. But know this — this is one of the great liberating businesses of the 21st century!

INTRODUCTION 

You can run your import export business from anywhere in the world.



You can build it as small or as large as you want.



You can specialize in products or industries that you’re most knowledgeable about or you can delve into new markets.

Everything you need to be successful is right here in this import/export business kit. So take your time and focus on all of the material that we’ve assembled for your benefit. You won’t be disappointed. Congratulations! Sincerely,

Marc Charles Early To Rise

CHAPTER 1: The Multi-Trillion Dollar Import/Export Market

CHAPTER 1

The Multi-Trillion Dollar Import/Export Market The worldwide import/export market is a multi-trillion dollar windfall of cash! A hundred years ago it was almost impossible for small entrepreneurs to break into this market because one needed significant capital, contacts and a lot of expertise in international law and contracts. All that has changed. Today entrepreneurs can start an import/export business from the comfort of their own home with just with a computer, phone line, Internet access and a bank account. On top of that, there are hundreds of websites and resources available to entrepreneurs today that didn’t exist ten years or even five years ago. For instance, the website Alibaba.com is the largest and most successful import/export site for entrepreneurs in the world. Alibaba.com boasts of more than 18 million members in 200 countries! And that’s only the tip of the iceberg! Although Alibaba.com facilitates more than $5 billion in import/export transactions each year — that still leaves trillions of dollars in business on the table. The international import/export business is the new frontier of the 21st century for both aspiring and established entrepreneurs… this is where opportunity awaits.

Here are some recent testimonials from a few of the import/export entrepreneurs on Alibaba.com: 

Mr. Wai Khean Wong (Malaysia/Home & Office Furniture) “Our first order was valued at close to $160,000 USD!”



Mr. Jason Yee (Singapore/Refurbished Notebooks) “Ten deals and all stocks sold out!”



Mr. Choi Jin-Woo (South Korea/Health and Beauty Products) “Within one month, we received dozens of inquiries from buyers in more than 50 countries.”



Mr. Chester Chou (Taiwan/Sports Products) “Ten purchase orders for $100,000 USD in first year on Alibaba.”



Ms. Diana De Avila (USA/Clothes) “Alibaba.com is our competitive edge. We receive more than 250 inquires a month!”

Start Your Own Internet Import/Export Business

1

CHAPTER 1: The Multi-Trillion Dollar Import/Export Market 

Mr. Kan Sen Leon (Peru/Clothes-Apparel) “When I signed up for TrustPass, the demand for my products skyrocketed.”



Cai Xia (China/Interactive Toys, Arts & Crafts) “For 3 months, on average we received about 10-20 inquiries a week from overseas buyers. A great result!”



Mr. Henry Stewart (USA/General Merchandise) “It is the best website to source from in the world!”

The sky is the limit with an import/export business! What’s more, businesses in practically every country of the world need thousands of different products in hundreds of categories. This is a ground floor opportunity in every sense of the word. Look at these recent import/export statistics: 

China imports are estimated to be more than $1.5 trillion by 2007!



Japan imports from the US are expected to exceed $12 billion by 2007



UK imports from US - $4 billion by 2007



Brazil imports from US $1.5 billion by 2007



New Zealand imports from US should exceed $170 million — by 2007



US exports to Canada should exceed $28 billion by 2007!



US exports to Mexico $17 billion by 2007



US exports to France $2 billion by 2007



US exports to Hong Kong $2 billion by 2007

The leading import countries in 2004 are (in order): 

United States $1.6 trillion



Germany $716 billion



China $561 billion



France $470 billion



UK $467 billion



Japan $454 billion



Italy $355 billion



Netherlands $319 billion



Canada $280 billion



Belgium $278 billion

The leading export countries in 2004 are (in order):

2



Germany $910 billion



United States $818 billion



China $593 billion



Japan $566 billion China Wholesale Secret Program

CHAPTER 1: The Multi-Trillion Dollar Import/Export Market 

France $452 billion



Netherlands $357 billion



Italy $354 billion



UK $347 billion



Canada $317 billion

The total world import/export market will exceed $10 trillion dollars by 2010! This is the largest marketplace in the world or on the Internet. There are unlimited opportunities for entrepreneurs of every background and level. We’ll show you in plain, everyday language, HOW to tap into this trillion-dollar marketplace from the comfort of your home so you can start generating major profits too. Here’s a glimpse of what you’ll learn: 

Hot New Rising Trends



The Most Powerful Import/Export Website on the Internet for Entrepreneurs



The Benefits of an Internet Import/Export Business



The Truth About Internet and Email Marketing



How to Determine Which Products to Import/Export



How to Obtain Products from Overseas Manufacturers for the Wholesale Market



How to Resell Products on the Internet



How to Wholesale Products to Retailers



How to Become an Import/Export Middleman

Plus! 

How to Dominate Internet Search Engines and Directories



How to Utilize Powerful Linking Strategies



How to Buy Keywords and Phrases on Search Engines (in order to sell products)



The Secrets of Effective Online Advertising



How to Resell Imported Products with Online Classified Ads



How to Attract Customers with Monster Prospect Machines



How to Build and Market eStores “On Demand”

You can scour the Internet, Google, Research Libraries, the Public Domain and Business Colleges a LIFETIME — but you will never find all of this information in one, easy-to-read report. Until Now!


3

CHAPTER 2: Benefits of an Internet Import/Export Business

CHAPTER 2

Benefits of an Internet Import/Export Business The benefits of owning your own Internet Import/Export business are too numerous to list, but here are just some of the benefits that you can enjoy:



Be your own boss One of the greatest freedoms in the world is working for yourself and calling all of the shots. If you have a hunch you can act on it without having to go through middle managers and people who don’t have the same passion and excitement for your business as you do.



Work your own hours Imagine working when you feel like it. Maybe you prefer to work late at night when the kids are in bed. Or maybe you are an early riser and prefer to get everything done before 10 o’clock. You can set and work your own hours. The problem is you’ll enjoy this business so much you’ll want to work all the time!



Unlimited profit potential There are very few businesses in the world that offer unlimited profit potential. Most retail businesses are dependant on foot traffic. Other businesses may have huge profit potential but also require you to have a substantial net worth. An import/export business has unlimited profit potential. One of the great import/export entrepreneurs of all time was Aristotle Onassis — he became a billionaire in this business.



Portability — work from anywhere in the world How many businesses can you think of that could be packed up in a laptop computer, moved around the world, and be started again with very little effort? This business enables you to work from anywhere in the world — and when it’s time to move on just pack up and take your business with you.



Simple learning curve An import/export business is incredibly easy to learn. You simply identify someone or a company that needs a product. You locate that product for them in the quantity they desire, arrange for payment, ship the products (the company with the product typically takes care of the details) and you are done. It’s that simple.



Very little start up capital required Fifty years ago it would have been almost impossible to start an import/export business

4

China Wholesale Secret Program

CHAPTER 2: Benefits of an Internet Import/Export Business without a significant bankroll (and contacts). But today — with the Internet — having capital is not that important.

More Benefits! Develop rich, fulfilling relationships with likeminded entrepreneurs in practically every country of the world 

Tax benefits (consult your tax professional for specifics)



Respect from the business community



Instantaneous money exchanges



No billing



No face-to-face selling (unless you want to)



Be a part of the global community



Gain a deeper understanding of other cultures



Travel abroad at deep discounts



Work anonymously (if so desired)



Enjoy the dynamics of an industry that is constantly changing



Prestige — Become a renowned expert and sought after speaker



No language barriers (translators are available when needed)



No employees (unless you want them)



No physical buildings, offices or storefronts required



No understanding of currency markets required (but it’s a good thing to know)

I’ve only just touched upon the many benefits of this exciting business. Being your own boss, having unlimited profit potential and low start-up capital requirements are perhaps the most attractive benefits for most entrepreneurs. In the next chapter we’ll show you the hottest, new rising trends in the import/export market and how you can position yourself to benefit from these trends.


5

CHAPTER 3: Hot New Rising Trends

CHAPTER 3

Hot New Rising Trends There are hot new trends to be found emerging in the import/export market. Your business will be in a position to benefit from these trends. One of the ways to identify emerging trends is to watch population shifts and growth. As the population in a particular area expands so does the demand for hundreds of different products and services. Another way to identify hot new trends is by watching the growth of per capita income in specific areas. When income levels rise so does the desire to spend it! Countries like China, India, Thailand, Croatia, Brazil and Russia are importing products from the U.S., Canada, Europe and South America in droves! In fact, imports to China from the USA increased by more than 28% in 2004 according to the U.S. Commerce Department. So what does this mean for your Internet Import/Export Business? Everything. The demand for products has never been greater — and the trend is growing at a phenomenal rate. There has never been a better time to profit from an Internet-based Import/ Export business.

Here are the fastest growing categories according to the World Trade Organization (WTO) in 2005:

Here is just a small sample of the products that people and businesses need — and they’re willing to pay a premium to get them:

Office and Telecom Equipment 10%

China The price that people and companies are willing to pay for these items will vary depending on the quantities, frequency, quality, shipping

6

Textiles 11%

Clothing 12% Automotive Products 15%

Iron and Steel +27% Ores and Minerals +23% Consumer Fuels Goods +22% +19% Ag Products Chemicals +20% +20%


CHAPTER 3: Hot New Rising Trends and other factors. But you will find that people will be eager to work with you because of the demand and potential for profit. 

Plastic strapping / Black plastic strapping



Soybeans / 50,000mt per month x 12



Cigarettes / Mild Seven SE555 (new packing) or brand cigarettes



Oats / Instant rolled oats, oat bran, breakfast cereals and organic cereals.



Palm Oil / crude palm oil 55 gal



Feathers / original American turkey feathers



Horse Hair / Horse tail hair, yak hair and goat hair for yarns and textiles



Cashews / 3000mt cashew and 15000mt sesame seeds



Garlic / need garlic urgently 6.0cm+, loose, 9kg cartons



American Rice / 2000 MT x 12 months



Sesame seed oil / any quantity



Apples / all kinds of fruits including apple, pear and more



Garden Equipment / Garden tools & wooden garden tools & equipments



Dried Rosehips / Any quantity



Gas-powered trimmers / All sizes / crates of 6



Also, business equipment, toys, automobiles, DVDs, jeans, tee shirts, beer, gold, designer clothes and handbags, safety vests, security equipment, toiletries, herbs, ginseng, zircon sand, quartz watches, polyester resin, glycerin, sulphur, playing cards, PS2 parts, and thousands more!

India 

Soybeans / 50,000mt per month



Cigarettes / generic



Garlic / 9kg cartons



American Rice / 5000 MT



Raw wool / 40Ft Container C. I. F at any port at New Mumbai, India



Apples / Will negotiate quantity



Garden Equipment / garden tools



PVC resins / bulk



Iron Ore / 63.5% iron ore fines - Quantity 60,000 lbs x 12 months



Nokia Mobile Phone accessories / Nokia & Sony models of Mobiles



Dried Rosehips / All quantities



Gas-powered trimmers / all sizes



Bricks / Kiln Inlet ISO Shape Bricks 620



Bicycles / BMX, children & MTB models



Rechargeable batteries / Lithium Ion Rechargeable battery PP29E11146, 3.7 V 1400mAh no.1CR17670


7

CHAPTER 3: Hot New Rising Trends 

Titanium wire / All gauges



Turbine engines / 2 to 3 MW steam turbine, 480 V, 60 hz, 3ph Inlet steam 250 psi@500 deg F, non condensing type.



Pen torch / Need to buy blinking torch – 30000pcs



Cable TV Receivers / Cable TV receiver with pvr has HDD (40gb/60gb/80gb)



Antennas



LED Torches / 300 to 500 pieces of small white LED lamp Key chains having 10,000 MCD



Bamboo fiber / Regular bamboo fibers



Blankets / Acrylic mink blankets in size 220 cms x 240 cms weight 4kgs



Herbal tea / High quality teas, green tea, black tea, ice tea, ginger tea, lemon tea, herbal tea and slimming tea



Raw tobacco / Raw tobacco and processed tobacco



Also, business equipment, jeans, tee shirts, beer, gold, designer clothes, toiletries, herbs, ginseng, polyester resin, glycerin, computer parts, and thousands more!

South Korea

8



Egg powder (animal feed) / All quantities



Olive oil / 500 MT



Yellow Corn / 5000 bsh x 12



Mushrooms / All varieties



Yucca / 5 kilo containers



Cosmetics / Top brand cosmetic sample as sk2, Lancome, Dior, Estee Lauder, Mac, etc



Nose trimmers / all types



Plywood / 4x8 / pallets



Granite / Top grade unpolished India black slabs



Wallpaper / wallpaper made from natural resource



Low density F-board / odd sizes like 22 x 28, 23 x 36, 25 x 40,



Nokia handsets / small quantities



iPod batteries / all quantities



Wi-Fi light switches / high grade



Bluetooth headsets / new only



Used cellphones / 100 bx



Frozen seafood / All types, packaging and quantities



Organic fruit juice / not frozen



Dairy products / All types



Chicken meat / cleaned and processed only. Must pass inspection



White sugar / All grades and quantities



Wine / All varieties



Beer in cans / American only



Canned tomatoes / All types, packaging and quantities



Dried squid / fresh and frozen / all quantities



Also, business equipment, jeans, tee shirts, computer parts, printing equipment, paper, lumber, cable, floating glass, toys, noodles, urchins and thousands more!

Thailand 

Wire mesh / Black annealed wire Bwg 18 = 50 KG/coil = 8 containers @ 25 tons each



Insulation / All type of heat shrinkable tubes and insulation material



Rainwear / All types like gents black, ladies misc design and prints, children’s umbrella, fancy umbrella, rainwear of all types and uses



Hair clips / All shapes, colors, sizes and quantities



Footballs / football ball number 4-5 and basketball ball number 7 - 20 containers



Platinum / High quality high fashion products



Palm oil / crude palm oil



Herbs / All types especially organic



Zinc ingots / zinc bromide byproduct to manufacture zinc bromide



Computers / All brands and makes



Mobile phone parts / All brands and makes (only new)



Shortening / Organic Shortening



Also, business equipment, paper, lumber, cable, toys, noodles, urchins, fresh fish, crabmeat and thousands more!

Europe 

BAT Cigarettes / Marlbro red and Marlbro light in big quantity



Cocao nibs / All quanities



Frozen broccoli / IQF (frozen) vegetables



Wheat Milling Machine



Almond kernels / Large quantities



Used tractors / All makes, models, brands and year



Palm Oil / Large quantities



Barley (for animal feed) / USA grains



Soya / Soya bean milk quantity:5 FCL In bulk



Fishmeal / All quantities



Hydroponics grow lamps



Soy oil / All types and quantities



Tea / Fresh and organic



Herbs / gymnema sylvsetre leaves



Peanuts / red skin peanuts


9


Basmati rice / All types – bulk



Gooseberry extracts / 1 liter containers



Chick Peas / all shapes, sizes and grades



Olives / All kinds of olives and olive oils



Sunflower meal / Refined sunflower oil, 500 ton



Razors / Razors & shaving products



Cosmetics, perfume / All brands



Sauna belts / top quality only



Medical supplies / All



Household items / All



Colored contact lenses / Assorted sizes, colors and shapes



Blood pressure monitors / Medical grade



Toothbrushes / especially kids



Also, business equipment, toys, gold, ginseng, glycerin, and thousands more!

This is only a brief sampling of the products that are needed! The best part is you won’t need to know a lot about these products to import or export them. You will simply need to know where to find them and be able to strike a deal in order to get them to the end user.

Developing third world countries have an insatiable appetite for thousands of different products and services. But your business won’t be limited to doing business with these countries. There are hundreds of companies in dozens of countries that need high-end luxury items, too! Here are of some of the high-end luxury products are needed: 

Kuwait – caviar, exotic woods, jewelry, cell phones, smart cards



United Arab Emirates – fresh crabmeat, fish, lobster, diamonds, gold bullion



Switzerland – premium garlic, silver, platinum, organic beef, automobiles



Brazil – cognac, premium wine, fur, diamonds, cell phones, DVD players



Panama – digital cameras, smart cards, blank media, laptops

It is simply a matter of understanding what people and companies need and getting it to them. If you have specialized knowledge about some of these products that’s even better. The learning curve will be less. But know this — there is a website on the Internet that is the fastest growing import/export portal in the world. In fact, this website has been in the Top 10 of total Internet traffic for two years in a row.

10


CHAPTER 3: Hot New Rising Trends Forbes magazine awarded this website Best of the Web four years in a row! On top of that, the site is devoted to helping importers and exporters make money and build relationships. The website I refer to is Alibaba.com. In the next chapter we will show you this spectacular website in detail. You’ll understand why it has become the number one import-export portal in the world and on the Internet! You’ll quickly see why entrepreneurs everywhere are raving about Alibaba.com!


11

CHAPTER 4: The Most Powerful Import/Export Website on the Internet for Entrepreneurs

CHAPTER 4

The Most Powerful Import/Export Website on the Internet for Entrepreneurs The playing field for entrepreneurs has changed — especially when it comes to entrepreneurs in an importing and exporting business.

Trillions of dollars of products are purchased, imported and exported every year. Ten years ago, almost every import and export deal was done over the phone or by snail mail. In some cases entrepreneurs would have to travel to countries by air, boat or rail to meet with their importing or exporting clients. Granted, some of that is still done today. But in 1999 Jack Ma and a small group of entrepreneurs in Hangzhou, China had a vision for making the process of importing and exporting products much easier. On top of that, they understood the Internet would have to be the central focus in getting this done. They launched a website called Alibaba.com. The rest, as they say, is history. Alibaba.com has become much bigger than anyone ever expected. Alibaba.com has become the most powerful and efficient website in existence for import and export entrepreneurs. Here are just a few of the current statistics for this incredible website and portal.

Alibaba.com Facts Employee Headcount 

2,400

2004 Financials

12



Non-GAAP Revenue: US$68 million



Free cash flow: US$25 million China Wholesale Secret Program

CHAPTER 4: The Most Powerful Import/Export Website on the Internet for Entrepreneurs Alibaba International (www.alibaba.com) is Alibaba’s business-to-business marketplace for global trade. 

Registered members: 1.7 million



Member geographic distribution: 200+ countries and territories



Estimated 2004 transaction volume: US$1.5 billion



Number of site listings: 1.4 million



Alexa.com worldwide website traffic ranking: No. 28 • Alibaba.com has been ranked No.1 as the “Most Popular in International Business and Trade” on Alexa.com, a subsidiary of Amazon.com which provides independent website tracking data.

Alibaba China (www.china.alibaba.com) is a Chinese-language online marketplace for the domestic China business-to-business trade. 




Estimated 2004 transaction volume: US$3 billion




Taobao.com (www.taobao.com) is China’s top ranked consumer marketplace. 




Q2 2005 transaction volume (Gross Merchandise Volume or GMV): US$200 million






Alexa.com worldwide website traffic ranking: No. 26 in the world / No. 9 in China overall


13

CHAPTER 4: The Most Powerful Import/Export Website on the Internet for Entrepreneurs AliPay (www.alipay.com) is China’s leading online payment system. Paid Customers & National Sales Network 

Alibaba.com: Currently, more than 100,000 businesses in China pay between US$250-US$10,000 per year for Alibaba.com’s online marketing services. Most are small and medium-sized enterprises (SME’s)



Taobao and AliPay: Taobao and AliPay services are currently free to all users



Sales force: In China, Alibaba.com maintains a national direct sales force of more than 1,000 sales and service specialists, serving and training China’s exporters and domestic traders in e-commerce

Taobao.com (a subsidiary) is China’s top ranked consumer marketplace with 9.1 million members! That is huge! But if you think that’s great just keep in mind that Alibaba.com is just a babe. Alibaba.com has only been live for three years. Yahoo! recently entered into a long-term relationship with Alibaba.com to join forces in China.

Alibaba.com is here to stay! Jack Ma, Alibaba.com founder and CEO, was asked recently what he thought about eBay: “eBay thrives elsewhere but may falter in China. eBay may be a shark in the ocean, but I am a crocodile in the Yangtze River. If we fight in the ocean, we lose - but if we fight in the river, we win.” Where eBay is more focused on consumer auctions, Alibaba is more focused on entrepreneurs, and importers/exporters in particular. But eBay and Alibaba.com members are not at each other’s throats as it may appear. In fact, Alibaba.com participated in “eBay Live 2005” in San Jose, California last year. Thousands of eBay members are also Alibaba.com members. What’s more, entrepreneurs like Steve Gibson (CEO/Skyabove) are using Alibaba.com on a daily basis for their sourcing needs. Here is what Steve said about his relationship with eBay and Alibaba.com “We sell jewelry and consumer electronics products in our eBay store. Running an eBay business is time consuming. We spend the majority of our time looking for new products to sell. Alibaba has been like godsend. So far we haven’t had an incident that we cannot find products that we look for on Alibaba.com. Alibaba is perfect for us!” And there’s more…

14


CHAPTER 4: The Most Powerful Import/Export Website on the Internet for Entrepreneurs

Alibaba.com Awards and Honors Alibaba.com is the only import-export marketplace named “Best of the Web” four years in a row by Forbes Magazine . The site has also been selected as a “Top Website for Entrepreneurs” by U.S.based Entrepreneur magazine and the most popular B2B website by readers of the Far Eastern Economic Review, a leading financial weekly magazine published by Dow Jones in Asia. Amazon.com subsidiary Alexa (www.alexa.com) ranks Alibaba the world’s most popular site in the categories of Import-Export and International Business and Trade. Alexa also ranks Taobao.com as China’s most visited auction marketplace and one of the top 30 websites in the world, ahead of all other e-commerce sites in China. Jack Ma, Founder, founder and CEO of Alibaba.com was named a Young Global Leader by the World Economic Forum in 2005.

Alibaba.com Investors SOFTBANK Corporation SOFTBANK Corporation (Tokyo Stock Exchange: 9984) is one of the world’s Internet leaders. Through its ownership positions in more than 300 Internet companies and its unique, global approach to building Internet enterprises, it is able to realize unprecedented synergies among its group of companies. Fidelity Capital As the leading global money management firm with over $900 billion under management, Fidelity Investments goes to great lengths to understand the companies in which they invest our clients’ money. Fidelity’s entrepreneurial team of professionals is able to reach investment decisions quickly while preserving the independent, personal nature of the venture process. Granite Global Ventures Granite Global Ventures is a technology-focused investor sponsored by Venrock Associates, TIF Ventures of Singapore, and U.S. Bancorp Piper Jaffray. It invests in expansion stage companies in the software, communications, and healthcare industries. Through offices in Menlo Park, California; Singapore; and Shanghai, Granite Global Ventures and its affiliates are well positioned to assist portfolio companies to generate business opportunities in the U.S. and Asia. For more information, visit the Granite Global Ventures Web site at http://www.ggvc.com. Venture TDF Pte Ltd. of Singapore Venture TDF is a venture capital fund management company in Singapore, which was founded in October 1995. It currently has approximately US$400 million under direct and indirect management, investing exclusively in technology companies. Venture TDF’s goal is to assist talented entrepreneurs build world-class technology companies. Start Your Own Internet Import/Export Business

15

CHAPTER 4: The Most Powerful Import/Export Website on the Internet for Entrepreneurs Transpac Capital Transpac Capital is one of the oldest, largest and most prominent private equity investment firms in Asia. Transpac Capital has invested in over 190 companies in East Asia and the United States. The company is headquartered in Singapore and has offices in China, Hong Kong, Indonesia, Malaysia, the Phillipines, Taiwan, Thailand and the United States.

Alibaba.com is a solid company with a bright future. More important, there is still time to get in on the action and make a lot of money fast. Entrepreneurs are joining in droves because it’s so easy to get into the import/export business with a portal like Alibaba.com. More than 300,000 people visit the site every day. Most of the people who come to the site are global buyers and importers looking to find and trade with sellers in other countries. Importing and exporting is the fastest growing business sector in the world… and you can be a part of it!

16


CHAPTER 5: Google and other Monster Traffic Generators

CHAPTER 5

Google and other Monster Traffic Generators One of the keys to selling imported or exported products on an Internet website is targeted traffic. If you can drive qualified traffic to your website without a huge expense – you have a literal goldmine at your fingertips. This is especially true when it comes to reselling imported or exported products on a website. This section is devoted to the search engine Google — and for good reason. Google generates massive targeted searches everyday. We will show you Google in all its glory, and what this means for you and your business. We will also cover some of the other monster traffic generators like Yahoo!, eBay, Amazon.com, MSN, AOL and more! When you gain a deeper understanding of how Google works and how it can deliver unfathomable targeted traffic to your site and ventures — it will mean astronomical profit opportunities. We are confident this information will help your online business and bring big bucks to your pockets for years to come.

All About Google What does “Google” mean? The name “Google” is derived from the word “googol”. The word googol was coined by Milton Sirotta. Milton was anephew of American mathematician Edward Kasner. According to Wikipedia a googol is a number represented by a 1 followed by 100 zeros. A googol is a very large number. There isn’t a googol of anything in the universe — not stars, not dust particles, not even atoms! Google’s use of the term reflects their mission to organize the world’s immense information pool and make it universally accessible and useful.

Google Facts 

Google.com is one of the 5 most popular sites on the Internet and is used around the world by millions of people



Google is the #1 search engine in the Argentina, Australia, Belgium, Brazil, Canada, Denmark, France, Germany, India, Italy, Mexico, Spain, Sweden, Switzerland, U.K., U.S. (Nielsen/NetRatings 6/05, based on total number of unique visitors)


17

CHAPTER 5: Google and other Monster Traffic Generators 

Global unique users per month: 380 million (Nielsen/NetRatings 4/06)



112 international domains



Global audience: More than 50 percent of Google.com traffic is from outside the U.S.



More than 1.6 billion web pages indexed



255 million unique searches per day

Business Model Google generates revenue primarily through two programs: highly targeted advertising and online search services.

1) Google AdWords for Advertisers Google offers a highly effective advertising program that is widely recognized as one of the Web’s most efficient advertising vehicles. 

Pricing – Auction based pricing based on the value (cost-per-click or CPC) an advertiser assigns to particular keywords. An ad’s position on the page is determined by a combination of the CPC and the click-through rate (number of times the ad is clicked on by users) so that the most relevant ads are displayed more prominently. The cost of creating an account is $5 and there is no minimum ad spend required.



Technology – Prices for some clicks are adjusted based on their expected value to help ensure better performance for advertisers. An automated discounter keeps the cost of each click at the lowest amount possible in order to hold its position above a competitor’s ad. Other options include ad targeting by location and numerous tools for optimizing accounts, including a keyword suggestion tool and daily budget management.



Format – Messages appear adjacent to web search results on Google.com and partner sites. Labeled as “sponsored links,” they may appear on targeted content pages across the web.



Targeting – Based on advertiser selected keywords or sophisticated content analysis algorithms, so ads always appear in context with other information on the page.



Support – Two options: Advertisers sign up online and manage their own accounts, which are activated with a credit card. For larger advertisers, a full service account team sets up accounts, designs campaigns based on the advertiser’s defined metrics and then monitors creative and click-through rates to continuously optimize those campaigns.



Customers – Recent advertisers include: Sony, Cisco, Alamo Car Rental, Ameritrade, Amazon.com, Canon, Disney, General Motors, L.L. Bean, Nordstrom, Sears, Smith & Hawken, Sprint, Volvo and Xerox.

2) Google AdSense and Web Site Services The objective of Google’s AdSense program is to serve relevant ads on search result and content pages. 

18

Technology – Innovations include the ability to target relevant advertising based on keywords provided by a searcher or to dynamically analyze content and select relevant ads to display on a page. China Wholesale Secret Program


Support – Two options: (1) Publishers can manage their own accounts, which are activated through an online application process and implemented by simply cutting and pasting some HTML onto their web pages. (2) A dedicated sales team customizes programs for sites receiving more than 20 million page views per month.



Customers – USATODAY.com, ABC.com, Forbes.com and 60% of the comScore Media Metrix top 100 sites, as well as thousands of other specialty content sites.

Google Search Services enable publishers to search the content on their website — this is useful to a publisher’s audience, readership and subscriber base because it allows people to search a targeted pool of content. The search results can also be used to generate revenue with the AdSense program. 

Technology – Google search is based on a continuously evolving set of technologies that offer innovations in every aspect of information retrieval and provide users with the most relevant results.



Support – Hosted by Google, with results customized to customer’s specifications. Results available via HTTP and can be formatted in XML or Google’s proprietary protocol.



Updates – Conducted on a regular basis to ensure fresh content.



Reporting – Reports on daily number of traffic, top queries, top keywords searched, and other information.



Indexing – Billions of pages, the largest index on the web.



Features – Searches can be narrowed to a specific domain/subdomain or a specific language. Google also supports OR operators, keyword exclusion and phrase searching if quotation marks are used.



Customers – Washingtonpost.com, AOL/Netscape, Palm, Fujitsu NIFTY (Japan), NEC BIGLOBE (Japan), NetEase (China),Yam.com (Taiwan), Vodafone Global Platform and Internet Services Group (U.K.), Retivision (Spain), Sapo (Portugal), and Virgilio (Italy).

The Google Search Appliance is a scalable device that provides searches across individual websites and/or company intranets. 

Technology – Google search is based on a continuously evolving set of technologies that offers innovations in every aspect of information retrieval and provide users with the most relevant results.



Delivery – Hosted at the customer’s location on the Google Search Appliance, with results customized to customer’s specifications. Three models offer search across any size collection up to 15 million documents.



Updates – Crawls available on a schedule set by the customer. Password protected or secure pages can be indexed in most cases. Google’s caching technology makes it possible for users to access pages even if the hosting server is busy or down.



Reporting – Reports on daily number of traffic, top queries, top keywords searched, and other information.



Indexing – Customers can elect to offer different segments of their index to different users (e.g., by language, country, etc.)


19


Features – Searches can be narrowed to a specific domain/subdomain or a specific language. International language support enables search over documents in the following languages: Chinese (Simplified), Chinese (Traditional), Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hebrew, Hungarian, Icelandic, Italian, Japanese, Korean, Latvian, Lithuanian, Norwegian, Polish, Portuguese, Romanian, Russian, Spanish, Swedish. Google also supports OR operators, keyword exclusion and phrase searching if quotation marks are used. Partners can set a specific URL or set of URLs to be returned at the top of a list of returned queries.



Support – 24/7 technical support



Customers – PBS, The World Bank, Procter & Gamble, Cisco Systems, Boeing, Stanford University, Nextel and Kaiser Permanente

Google Wireless Services delivers search results to Personal Digital Assistants (PDA) wireless phones and other mobile devices.

Google Technology Overview Google is endeavoring to build the “perfect search engine”. The co-founder of Google Larry Page defined the “perfect search engine” as something that “understands exactly what you mean and gives you back exactly what you want.” That’s a lofty goal — but many people believe no one does search better than Google. Google has also developed its own serving infrastructure and the breakthrough PageRank™ technology. Combined these have changed the way searches are conducted on the Internet. Google’s developers realized that providing the fastest, most accurate results required a different kind of server architecture.. Most search engines use several large servers to handle searching tasks but this approach often slows down during peak loads. Google on the other hand — simply linked PCs to quickly find each query’s answer. This innovation (linking PCs) paid off in faster response times, greater scalability and lower costs. Other search engineshave since copied this approach, but Google is continually working on their back-end technology to make it even more efficient. The software behind Google’s search technology is also revolutionary. It conducts several simultaneous calculations requiring only a fraction of a second. Most of the other top search engines rely on how often a word appears on a web page. Google uses PageRank™ to examine the link structure of the web and determines which pages are most “important”. Then the software conducts hypertext-matching analysis to determine which pages are relevant to the specific search being conducted. It all sounds very complicated and sophisticated. But it is very logical and simplistic. By simply combining the overall importance and query-specific relevance, Google is able to put the most relevant and reliable results first.

20



PageRank™ Technology 

PageRank™ measures the importance of web pages by solving an equation of more than 500 million variables and 2 billion terms.



But instead of counting direct links, PageRank™ interprets a link from one page to another page as one vote..



PageRank™ then determines a page’s importance by the number of votes it receives. It’s a simple and logical way to determine the importance of a particular web page.



PageRank™ also considers the importance of each page that casts a vote. Web pages are considered to have greater value if they cast a vote, thus giving the linked page greater value.



The end result is important pages receive a higher PageRank™ and these pages appear prominently in the search result pages. Google’s technology uses the “collective intelligence” of the web to determine a page’s importance.



There is no human involvement or manipulation of the results, which is why users have come to trust Google as a source of objective information untainted by paid placement.

Hypertext-Matching Analysis Google analyzes the actual content on a web page too. However, instead of scanning for page-based text (which can be manipulated by site publishers through meta-tags), Google’s technology analyzes the full content of a page and also factors in fonts, subdivisions of content and the precise location of each word. This is another reason why Google’s search technology is so effective. But that’s not all — Google also analyzes the content of “neighboring web pages” to ensure the results returned are the most relevant to a user’s query. Google pioneered the first wireless search technology for on-the-fly translation of HTML to formats optimized for Wireless Application Protocol (WAP), i-mode, J-SKY, and EZWeb. Google provides its wireless technology to AT&T Wireless, Sprint PCS, Nextel, Palm, Handspring, and Vodafone, among others.

Life of a Google Query A typical Google search query usually takes less than a half a second., It involves a number of steps that must be completed before results can be delivered to a person seeking information.

Google Web Server

Query

Google User

3. The search results are returned to the user in a split second.

1. The web server sends the query to the index servers. An index server is similar to the index in the back of a book — it tells which pages contain the words that match the query.

Index Servers

2. The query then travels to Docs Servers


the doc servers, which actually retrieves the stored documents. Snippets are generated to describe each search result.

21


Using Google to Generate Monster Traffic to Your Website There are two main ways of utilizing Google to generate monster traffic to your Website.

1) Website URL submission into the Google index This may be the most overlooked aspect of tapping into the power of Google — and it’s free! You simply submit your website URL into Google’s database. If accepted (and most sites are) your website will be scheduled for a “crawling” by a Google spider. Once your site is “crawled” it will be added into the Google index database. When a user searches Google the search results will “pick up” the “meta tag” keywords and description that are built in your website code (HTML, PHP, FrontPage, etc.). For example: If some searches for “Main Street Imports” and those keywords are used in your website meta tags — that page will appear. That doesn’t mean this page will necessarily appear on the first search result page. There may be thousands of other people and companies that have used these exact keywords. Therefore selecting the right keywords, phrases and description for your site is of the utmost importance.

2) Purchase targeted keywords and phrases with Google AdWords This is perhaps the most popular tool for generating monster traffic to your website with Google. Google AdWords enables you to “bid” on and purchase specific, targeted keywords and phrases. The cost for each keyword or phrase varies depending on popularity and availability. When a user searches Google utilizing one of the keywords or phrases that you have purchased — your advertisement will appear on the right hand side of the search result pages. You will see these listed vertically on the right hand side of the search result pages. There are typically 8-10 Google AdWord advertisements displayed on each search result page. For example: If a user searches for “Persian rugs” and you own that phrase your AdWord advertisement will be featured at the top of the vertical list. You can see why thousands of entrepreneurs are bidding on tens of thousands of keywords and phrases everyday! A top Google AdWord advertisement could generate thousands of click thrus to your website everyday — or in some cases hundreds of thousands, or even millions! It’s important to remember that Google is searched more than 255 million times a day!

Using Other Monster Traffic Generators In addition to Google, there are hundreds of other top search engines, portals and websites that can generate monster traffic to your website. Granted, advertising on hundreds of search engines, portals and high traffic websites can be costly. However, in most cases you can set “caps” on the amount you are willing and able to spend — if anything. What’s more, you can “test” to see which search engines, portals and high-traffic websites generate the most traffic at least expense. 22


CHAPTER 5: Google and other Monster Traffic Generators Testing is a common practice of the most successful direct marketers and entrepreneurs. Once you have identified the best search engines, portals and high-traffic websites for your purposes you can “roll out” very successful, and relatively inexpensive “campaigns”.

Here is a List of the 100 Top Traffic Websites on the Internet (as of this writing): (Courtesy of Alexa Internet) 1. Yahoo! Personalized content and search options. Chat rooms, free e-mail, clubs, and pager. www.yahoo.com 2. Microsoft Network (MSN) Dialup access and content provider. www.msn.com 3. Google Enables users to search the Web, Usenet, and images. www.google.com 4. Baidu.com http://www.baidu.com 5. QQ.com http://www.qq.com 6. MySpace http://www.myspace.com 7. Sina.com http://www.sina.com 8. Yahoo! Japan http://www.yahoo.co.jp 9. 163.com http://www.163.com 10. eBay http://www.ebay.com 11. Sohu http://www.sohu.com 12. Yahoo! China http://www.yahoo.com.cn 13. Live.com http://www.live.com Start Your Own Internet Import/Export Business

23

CHAPTER 5: Google and other Monster Traffic Generators 14. Microsoft http://www.microsoft.com 15. Amazon.com http://www.amazon.com 16. YouTube http://www.youtube.com 17. Wikipedia http://www.wikipedia.org 18. Passport.net http://www.passport.net 19. Blogger.com http://www.blogger.com 20. Google UK http://www.google.co.uk 21. Taobao.com http://www.taobao.com 22. Google Japan http://www.google.co.jp 23. BBC Newsline Ticker http://www.bbc.co.uk 24. Orkut http://www.orkut.com 25. Google Germany http://www.google.de 26. Go http://www.go.com 27. Naver.com http://www.naver.com 28. CNN http://www.cnn.com 29. CraigsList http://www.craigslist.org 30. Alibaba.com http://www.alibaba.com

24


CHAPTER 5: Google and other Monster Traffic Generators 31. Tom.com http://www.tom.com 32. Wretch http://www.wretch.com 33. RapidShare http://www.rapidshare.de 34. The Internet Movie Database http://www.imdb.com 35. AOL http://www.aol.com 36. eBay UK http://www.ebay.co.uk 37. Mixi http://www.mixi.jp 38. Google Espana http://www.google.es 39. 3721 http://www.3721.com 40. Flickr http://www.flickr.com 41. Xanga http://www.xanga.com 42. SOGOU.com http://www.sogou.com 43. Google Turkey http://www.google.com.tr 44. Megaupload http://www.megaupload.com 45. Friendster http://www.friendster.com 46. Rakuten http://www.rakuten.co.jp 47. Google France http://www.google.fr Start Your Own Internet Import/Export Business

25

CHAPTER 5: Google and other Monster Traffic Generators 48. Google Canada http://www.google.ca 49. Mail.ru http://www.mail.ru 50. Yandex http://www.yandex.ru 51. Nate.com http://www.nate.com 52. Daum http://www.daum.com 53. Livedoor http://www.livedoor.com 54. Geocities http://www.geocities.com 55. Hi5 http://www.hi5.com 56. Google SA http://www.google.com.sa 57. PC Home http://www.pchome.com.tw 58. China Ren http://www.chinaren.com 59. Newsgroup.la http://www.newsgroup.la 60. Google India http://www.google.co.in 61. LiveJournal http://www.livejournal.com 62. Soso http://www.soso.com 63. eBay Germany http://www.ebay.de 64. Thefacebook http://www.thefacebook.com

26


CHAPTER 5: Google and other Monster Traffic Generators 65. Apple Computer http://www.apple.com 66. Rediff.com http://www.rediff.com 67. Zhongsou http://www.zhongsou.com 68. Comcast.net http://www.comcast.net 69. Discuss.com http://www.discuss.com.hk 70. Google Mexico http://www.google.com.mx 71. Photo Bucket http://www.photobucket.com 72. ImageShack http://www.imageshack.com 73. The New York Times http://www.nytimes.com 74. eBay China http://www.ebay.com.cn 75. Mop.com http://www.mop.com 76. Fotolog http://www.fotolog.com 77. SourceForge http://www.sourceforge.com 78. About http://www.about.com 79. CNET.com http://www.cnet.com 80. Xinhuanet.com http://www.xinhuanet.com 81. Google Italy http://www.google.it


27

CHAPTER 5: Google and other Monster Traffic Generators 82. Dell Computers Online http://www.dell.com 83. Mojo Works http://www.mojoworks.com 84. Soufun.com http://www.soufun.com 85. China.com http://www.china.com 86. Uwants.com http://www.uwants.com 87. FC2 http://www.fc2.com 88. Free http://www.free.fr 89. MapQuest http://www.mapquest.com 90. StatCounter http://www.statcounter.com 91. VNET.cn http://www.vnet.cn 92. Google Australia http://www.google.com.au 93. Weather.com http://www.weather.com 94. Goo http://www.goo.ne.jp 95. Adobe http://www.adobe.com 96. CNNIC http://www.cnnic.cn 97. Digg http://www.digg.com 98. 21CN.com http://www.21cn.com

28


CHAPTER 5: Google and other Monster Traffic Generators 99. CMFU http://www.cmfu.com 100. HiNet http://www.hinet.net

Four Ways to Generate Monster Traffic From High Traffic Websites 1) Advertise Almost every high-traffic website, search engine and/or portal accepts all levels of advertising, with the exception of shopping sites (like Wal-Mart). Advertising can take the form of simple text links, banners, graphic buttons, images or pop-ups, and video.

2) Partnerships and Affiliate Programs Most search engines, portals and high-traffic websites have partnership and affiliate programs available. A partnership program would include cross marketing, link exchanges and/or promoting each other’s properties. Affiliate programs are typically when you sell someone’s products or services on your website and in exchange receive a commission or promotional credit.

3) Link Exchanges Link exchanges are the process whereby you promote a search engine, portal or high-traffic site’s products and or services on a website. In turn the reciprocating property does the exact same thing for you. In many cases it’s simply an agreement to a graphic image or logo that is assigned to a unique URL.

4) In kind services (usually content or images) In kind exchanges is an agreement whereby a search engine, portal or high traffic website agrees to promote your website or company in exchange for an article, content or images that you provide. You now have a basic understanding of how Google works. This will help you leverage Google’s products and drive traffic to your website with a view to increasing sales of imported products. We also included links to the Top 100 Highest Traffic Websites and Portals on the Internet and showed you how to create partnerships with these sites and leverage their traffic for your benefit. In the next chapter we’ll begin laying the foundation for your successful import/export business. We’ll explain all of the nuts and bolts for getting your business off to a fast, profitable start!


29

CHAPTER 6: The Nuts and Bolts of an Online Import/Export Business

CHAPTER 6

The Nuts and Bolts of an Online Import/Export Business We have been focusing most of our attention on the incredible opportunities offered by Alibaba.com.

But there are hundreds of different types of import/export sites on the Internet. We have listed many of these in the Additional Resources Section (chapters 22 and 23). But the process of launching an online import and export business will be basically the same. This section is designed to give you a nuts and bolts overview for starting an online import and export business.

What Is an Alibaba.com Buyer and Seller? 

Sellers (or exporters) post his or her company information and product photos (together with descriptions, specifications, shipping terms, etc.) on Alibaba.com.

Selling Overview Please follow the steps below to sell your products on Alibaba.com.

1. Register To sell or promote your products on Alibaba.com, you first need to become a member. Simply click on the “Join Now” link on the top-right corner of any Alibaba.com page and follow the process. Then you can promote your products to attract buyers.

2. Post Products and Selling Leads You can add detailed specifications to your products and edit them at any time. You will also have a Company Profile page to present a general introduction of your business. Newly posted information will be added to the Trade Alert section and sent to interested buyers.

3. Explore Buying Leads Browse buying requests (Buying Leads) by category or open searching. 30



4. Contact buyers Once you find a potential buyer for your products, you can contact him/her by sending a quotation.

5. Promotion Opportunities You can also promote your business on Alibaba.com by: 

Obtaining the priority listing for products in search result listings.



Applying for TrustPass qualification, as well as a TrustPass profile page to further demonstrate your credibility to buyers.

Posting Products and Selling Leads Posting your product images, specifications and descriptions on Alibaba.com increases your exposure to buyers. On Alibaba.com, a member can post multiple products. Selling Lead means a Trade Lead posted by a seller. It can contain product information, availability, timelines and so forth. Trade Leads are sorted according to the date they are posted. This makes for a highly interactive and timely method to sell your products.

Posting Trade Leads Use Selling Tools within MyAlibaba or from other pages by clicking on the “Post Products” link in the “Seller Tools” box. Free members are allowed to post up to five products. Paid members can post more products and buy extra product spaces.

Posting Products You can post Selling Leads in “Selling Tools” within My Alibaba, or from many other pages by clicking on the “Post Selling Leads” link in the “Seller Tools” box. Upon publication, buyers will be able to see your Products and Selling Leads, to which they can reply. All of the buyers’ messages will be sent to your own Message Center in MyAlibaba.

Buying Overview Buying on Alibaba.com is easy. Follow these steps to begin your buying experience: 

If you are new to Alibaba.com, Join as an Alibaba.com member first



Look for Products and Suppliers



Contact Sellers after you find products



Post Buying Leads to get instant seller quotations

Looking for Products and Suppliers If you want to find a product, or the suppliers who produce that product, you can use either our search function or browse by category. Start Your Own Internet Import/Export Business

31


Browsing 

Click the “Buy” tab

on the main navigation bar on any page.



You can browse the extensive product categories to find whatever you want.



Use the filters above the listing to refine your browse.

To see the product categories, click here

Search Basics 

If you already know what you are looking for, enter the product name in a search box to start a search.



The results will look like this:

They will include the title, the posted date, summary, the company name of the seller, its country, and the icon(s) denoting the membership type(s) of the seller. 

The results are sorted by relevance and by membership type.



Use the filters above the listing to refine your search results.

Search Tips 

To refine your search results, use the filters above the listing.



If the results are unsatisfactory, reduce the number of words (i.e. “bicycle framework” instead of “carbon bicycle frame work”).



Avoid keywords which are too specific or specialized (i.e. “4X4 Honda ATV”).



Only search one product at a time.



Don’t include a country/region’s name in your search (i.e. “shoe China”).



Don’t include the word “buyer” or “seller” in your keyword phrase (for example: “shoe buyer”).

Get More Accurate Search Results

32



Use asterisk (*) sign: To broaden your search, use an asterisk (*) at the end of a word or partial word. For example, “auto*” would return all postings starting with “auto”, such as “auto” or “automobile” or “automation”, etc.



Use quotation marks (“ “): For exact results, use quotation marks (e.g., “ac adapter”). If the results are not satisfactory, try again without quotation marks (e.g., ac adapter).



Use plus (+) sign: When using the operator “+” a keyword will definitely appear in the search


CHAPTER 6: The Nuts and Bolts of an Online Import/Export Business results (i.e. “red+apple” will return results containing “apple,” but may not contain “red,” although those with the word “red” will be listed first.) Please note: Do not leave any spaces between the “+” sign and the keyword. 

Use minus (-) sign: When using the operator “-” sign, a keyword will not appear in the search results. (i.e. “apple-red” will return all results containing “apple”, but no results containing “red” will appear.) Please note: Do not leave any spaces between the - sign and the keyword.



Remember, make sure that no punctuation marks except +, -, and “ “ are included in your keyword phrase (i.e. bearing 3000/sec).

Contacting Suppliers Sending Inquiries 

You can send inquiries to sellers you find through browse or search. Use these steps:



Select the checkbox beside each product or supplier you are interested in



Click



Complete the inquiry form and submit.



If you check more than one product or supplier, your inquiries will be sent to these suppliers simultaneously.



Once you send out your inquiry, it will probably take sellers a few days to respond. Their replies will be sent to your Message Center in MyAlibaba.

button.

Send Multiple Inquiries to Products or Suppliers 

Select the checkbox beside each product or supplier you are interested in.



Click



When you are ready to make your inquiry, go to the Inquiry Basket located at the top-right corner of each page.



Review your selection and click “Contact Now” button.



Complete the inquiry form and submit.

button.

Your Inquiry Basket works like a shopping cart, thus offering buyers greater convenience. You can add up to 38 items in your Inquiry Basket. The items in your Inquiry Basket will remain active only if you keep at least one Alibaba.com page open. Please send your inquiries before you leave the Alibaba.com website.

Trade Alert Trade Alert is a customized email that delivers information and business leads directly to you. Subscribe to Trade Alert to get the freshest business opportunities.

Subscribing to Trade Alert If you are already an Alibaba.com member, please sign in at MyAlibaba go to “My Subscriptions,” and click “Subscribe.”


33

CHAPTER 6: The Nuts and Bolts of an Online Import/Export Business Follow the instructions to set up your Trade Alert preferences. Once you have completed the process, you will receive Trade Alerts by email as soon as new content matching your preferences is published online at Alibaba.com. If you are not yet an Alibaba.com member, you are strongly recommended to join Alibaba.com and subscribe to the Trade Alert located in MyAlibaba as described above. Or, if you choose to subscribe to Trade Alert as a non-member, please click “Free Trade Alerts” in the navigation bar of “Trade Leads — Products — Companies.” Follow the instructions and complete the process.

Adjusting Trade Alert Settings If you are already an Alibaba.com member, please sign in at MyAlibaba, go to “My Subscriptions,” and click “Manage Trade Alerts.” Follow the instructions to modify your Trade Alert settings. You can also go to the “Manage Trade Alerts” page in MyAlibaba by clicking the “Manage Trade Alerts Preferences” link in any of the Trade Alert emails you receive at your registered email address. If you have subscribed as a non-member, you cannot modify any setting.

Un-subscribing to Trade Alert If you are already an Alibaba.com member, please sign in at MyAlibaba, go to “My Subscriptions,” and click “Unsubscribe.” Simply follow the instructions to unsubscribe. You may also unsubscribe by clicking the “Unsubscribe” link in any of the Trade Alert emails you receive at your registered email address. If you are not an Alibaba.com member, you can unsubscribe only by clicking the “Unsubscribe” link in any of the Trade Alert emails you received at your registered email address. You now have a basic understanding and foundation for doing business on Alibaba.com and launching a profitable import/export business. In the next chapter we’ll cover one of the most important aspects to any import/export business — identifying the best products!

34


CHAPTER 7: How to Determine Which Products to Import/Export

CHAPTER 7

How to Determine Which Products to Import/Export The best way to determine which products to import or export is to look at the Trade Leads on Alibaba.com. The Trade Leads will tell you which products are in demand for and which products are not. An example: There were 48,365 Selling Trade Leads and 3687 Buying Trade Leads posted on Alibaba.com today. That means more than 48,000 products were posted for sale and 3687 products were posted that people or companies wanted to buy. Both of these figures may be misleading because the quantities of these products are not mentioned. In one case an exporter had more than one million cubic bushels of rice for sale! In another post, a company in Mexico had more than 5,000 pounds of fresh coffee beans for sale. Alibaba.com is one of the best sites on the Internet to determine which products to buy and sell because the statistics are always posted on the main page. But let’s take this one step further… There’s another section on Alibaba.com called Hot Products. The reason these products are “hot” is because they’re moving in a big way. For instance, in the Hot Products section today there were more than 253 products for sale, one of which was Dried Anchovies from China. Another Hot Product that a company (also in China) wanted to buy was seashell ornaments (bracelets, necklaces, and so on). And the list goes on! To help you even further, Alibaba.com has launched a new service called the Resources Channel. The Resources Channel is a place where you can find essential information, education, tutorials and discussion forums — all designed to help you become a successful importer or exporter. Another way to determine hot products and rising trends is by subscribing to News Alerts on Google. Whenever news is available on the topics or keywords you select you are notified by email Start Your Own Internet Import/Export Business

35

CHAPTER 7: How to Determine Which Products to Import/Export with a link to the story or news source. The Google News Alert service is free and scours more than 4800 top news sources. You will hear news long before your local newspaper prints it. You can subscribe to the Google News Alert at http://www.google.com/alerts

36


CHAPTER 8: Obtaining Products from Overseas Manufacturers for the Wholesale Market

CHAPTER 8

Obtaining Products from Overseas Manufacturers for the Wholesale Market Obtaining products from overseas manufacturers is fairly easy to do — and especially with Alibaba.com. The most common reasons for obtaining products from overseas manufacturers is to wholesale them to companies in other parts of the world. This is another exciting aspect to running a profitable import and export business over the Internet. Your objective is to identify companies that need specific products and then identify the manufacturers that produce them. This is referred to as the “wholesale side” of the import/export market. For example: Let’s say that you identified a company in Zimbabwe that needs 900 tons of maize every month for 12 months. This was an actual “buying lead” on Alibaba.com this morning. The next step would to identify a company that grows or produces maize. The company could be located anywhere in the world — it doesn’t matter in this case. A simple search of “selling leads” on Alibaba.com located several companies that grow and export maize. Upon further investigation you learn that three companies are able to fulfill an order of 900 tons per month. You would contact the company in order to obtain a price quote that includes shipping. Once you’ve obtained this price quote you would notify the company in Zimbabwe that you would like to submit a bid — they accept your bid and you reach an agreement. Now arrangements will need to be made with regards to money transfers and shipping. There are several ways to approach this but either way Aliabab.com makes it easy – and especially with the new TrustPass Program. The TrustPass Program pre-approves companies and obtains letters of credit and references. In this example we used two companies (buyers and sellers) that we listed on Alibaba.com. But believe it or not, most business people have never even heard of Alibaba.com…which makes you — with your business expertise and knowledge — even more desirable and unique. Start Your Own Internet Import/Export Business

37

CHAPTER 8: Obtaining Products from Overseas Manufacturers for the Wholesale Market Let’s say, for example, that you’ve located companies in China, Australia, Brazil Egypt or United Arab Emirates that are not familiar with Alibaba.com. The companies that you’ve identified need certain products — in this case, dairy products. All you need to do is search the selling leads on Alibaba.com for dairy products. You find a company that manufactures all kinds of dairy products and is able to ship them via refrigerated containers to anywhere in the world. Next you check back with the companies that need dairy products and find out specifically which dairy products they need, and how much. Then contact the selling lead for a specific price quote that includes shipping and any other fees. Finally, you would contact the company that needs the dairy products and you submit your bid. But remember — you’re in the import/export business to make money — so be sure to increase the price of your dairy product bid by at least 15%. Obviously a 15% surcharge or commission will not be suitable for every product and every deal that you transact. But in this case, a 15% surcharge or commission seems to be very reasonable. In some cases, you will be able to charge a 40% surcharge or more! It will take some time for you to learn the specifics for each product and market you’re involved in, but with experience, you’ll find it’s easier and easier.

Payment Transactions and Money Exchanges Again, Alibaba.com makes payment transactions easy and in most cases very simple. The best thing to do is to open a bank account specifically earmarked for your import/export business. Once the account is opened you can ask your bank representative for the wire transfer details. [Note: If the bank representative is clueless about wire transfers then you’re at the wrong bank or it’s too small or unable to handle international transactions.]

Top International Banks that Offer Wire Transfer Capabilities Barclays http://www.barclays.com Wells Fargo http://www.wellsfargo.com Bank of America http://www.bankofamerica.com

38


CHAPTER 8: Obtaining Products from Overseas Manufacturers for the Wholesale Market CitiGroup http://www.citigroup.com HSBC Holdings http://www.hsbc.com Sumitomo Mitsui Banking Corp. http://www.smbc.co.jp National Australia Bank http://www.national.com.au Dresdner Bank AG http://www.dresdner-bank.com/ UBS Group http://www.ubs.com Royal Bank of Canada http://www.royalbank.com Bank Leumi http://english.leumi.co.il Once you have an account that can accept wire transfers you can start making deals. Most of the time a portion of the money is set-aside in a type of escrow (you’ll learn more about this later). Escrow is a fairly common procedure when it comes to international business — and specifically with respect to import/export businesses. The escrow procedure protects both parties should something unexpected transpire. For example, let’s say that you’ve completed your first deal. A portion of the money is wired into your account. The remaining portion will be wired once the buyer receives the product. But what if the boat carrying the product capsizes in the North Atlantic due to a horrendous storm. The entire product onboard is lost. Who pays? There are provisions in every import/export deal and agreement that specifically address such unfortunate circumstance. You can see that obtaining products from overseas manufacturers can be fun, easy and very profitable. In the example of the buyer who was interested in obtaining maize — the profit would have worked out as follows:

Buyer Agrees to purchase 900 pounds of maize at 70 cents per pound ($630) for 12 months (for a total of $7,560 plus $1,950 for shipping).

Seller Agrees to sell 900 pounds of maize to you for 45 cents per pound ($405) for 12 months (for a total of $4,860 plus $1,950 for shipping). Start Your Own Internet Import/Export Business

39

CHAPTER 8: Obtaining Products from Overseas Manufacturers for the Wholesale Market Buyer agrees to wire half of the amount that you quoted into your account ($3,780) — you in turn wire half of the amount the Seller quoted to you ($2,430). Buyer agrees to wire the remaining amount in full upon receipt of the first shipment (terms obviously will vary) — which in this case would $3,780. Your profit would calculate as follows: Buyer Quote and Agreed Upon Purchase Price: $7,580 (+ shipping) Seller Quote and Agreed Upon Selling Price: $4,860 (+shipping) Your Profit: $2,720 Not bad for a couple of emails and/or phone calls! But keep in mind this is a very small deal. There are thousands of deals like this waiting to be completed with your name of them! The wholesale side of any import/export business can be very profitable. On top of that, the size of the deals can be significant. Obtaining products from overseas manufacturers is fairly easy to do with Alibaba.com. The most common reason for obtaining products from overseas manufacturers is to wholesale them to companies in other parts of the world. In the next chapter we’ll show you the secrets for reselling imported products on the Internet.

40


CHAPTER 9: Reselling Products on the Internet

CHAPTER 9

Reselling Products on the Internet You can import products incredibly cheap and sell them on the Internet with profit margins of 200%, 400%, 600% or more!

Here’s a List of 40 Best Selling Products Priced under $45 on the Froogle (Google’s shopping site)

These are generally accepted prices that you could expect to pay when importing these products in bulk: Under $45 Optical mouse Crème brulee torch Glow stick Pond pumps Emerald ring Chopsticks Forceps Docking station Cargo pants Whey protein powder Buffalo meat Low rise jeans Olive oil Running shoes Bumper stickers Skim board Viagra Mp3 player Lawn gnome Vitamins Herbs and extracts Start Your Own Internet Import/Export Business

Import Price $1.95 $7.50 $.22 $8.00 $2.50 $.14 $1.95 $2.25 $5.00 $.90 lb $.80 lb $3.40 $6.00 gal $3.35 pr $.27 ea (unprinted) $1.98 $.65 tablet/generic $6.65 $2.25 $1.55 bottle Varies 41

CHAPTER 9: Reselling Products on the Internet Belly button rings Climbing shoes Ladder Blow dryer Hearthrug CD burner Spa pump Sigma lens Stationary bike Flip flops Gold chain Makeup USB CD writer Aviator sunglasses Men’s watches Sheepskin boots Balloons Money clip

$1.90 $2.90 pr $4.00 $3.95 $2.00 ea $6.25 $12.75 Varies $22 $.95 pr Varies $1.65 ct mascara $2.85 $6.25 $1.55 $2.90 $3.95 pr $.35 dz $.45

The profit potential for selling products like these on the Internet is staggering! Granted, in some cases you will need to purchase bulk quantities (but not always), so you’ll want to be sure that you can move a particular product. There are powerful resources on the Internet available to Import/Export entrepreneurs that will help you determine which products require that you purchase them in bulk or not. If you’re selling into a hot market, like the products listed above, you don’t want to have a huge stockpile or inventory.

Wal-Mart is the Largest Retailer in the World because of Their Unique “On-Demand” Inventory and Distribution System — Not because of Low Pricing. The secret to success online is selling products that are already successful. Don’t try to reinvent the wheel — or try selling products that do not have a track record. Granted, there are a lot of products that became overnight sensations on the Internet, like iPod, Viagra, Red Sox apparel and memorabilia, CD burners, LCD screens and Coral Calcium. But to predict these phenomena and stockpile huge inventories would not have been prudent. The best and most profitable way to sell products on the Internet is to import products at deep discounts and maintain very small inventories. 42


CHAPTER 9: Reselling Products on the Internet Always keep in mind that markets and the demand for products shift quickly. In order to resell products on the Internet you’ll need a website where people will visit to find out about your products and order. There are many ways to approach this part of the import/export business but starting small and as inexpensively as possible is always a good rule of thumb.

How to Design a Website so It Generates the Most Possible Sales The best examples of successful website designs are the ones that are generating sales! Copy success. Copy the design, layout, navigation and ordering process of the websites that are selling the most products on the Internet. Granted, you may not have the same budget as Amazon.com, Buy.com or Overstock.com so duplicating these websites might appear to be difficult. But remember, all these sites started out small. Amazon.com consisted of less than 75 pages when it launched in 1998. Today there are thousands of pages of reviews, product photos, content and recommendations. You’ll want to copy the “essence” of what makes these websites so effective with respect to selling products on the Internet.

Here are the Top 10 Websites for Shopping on the Internet according to Alexa Internet: Amazon.com http://www.amazon.com eBay (eBay doesn’t actually sell any products — but they facilitate sales – it’s still a good model) http://www.ebay.com Overstock.com http://www.overstock.com Wal-Mart http://www.wal-mart.com Yahoo! Auctions http://www.yahoo.com Target http://www.target.com


43

CHAPTER 9: Reselling Products on the Internet BestBuy http://www.bestbuy.com Netflix http://www.netflix.com eBay Stores http://stores.ebay.com Buy.com http://www.buy.com

What do these websites have in common? 1) White space! All of these sites surround products with a lot of white space, which makes it easy to see the products. 2) High quality product photographs! 3) Easy Ordering and Checkout! If you keep these 3 things in mind when you’re designing a website to sell products on the Internet you will be light years ahead of the competition. In one sense these sites are not good examples because they present HUGE inventories of products. In most cases it’s better to focus on one product or sector when you’re first starting out. This will help to simplify your business, the importing process, and shipping orders. It will also make it easy for your customers to place an order!

Here are 10 Successful Niche Product Websites: Delorme Maps http://www.delorme.com Sunglass Replicas http://www.sunglassreplicas.com Vitamin World http://www.vitaminworld.com Body Candy (belly button rings) http://www.bodycandy.com Neato (blank media and CDs) http://www.neato.com Glenbrook Farms (organic herbs) http://www.glenbrookfarm.com/herbs

44


CHAPTER 9: Reselling Products on the Internet Fragrance Net (perfume) http://www.fragrancenet.com 800-Pillows http://www.800pillows.com HealthyPetNet http://www.healthypetnet.com Christmas Ornaments http://www.bronners.com

You don’t need to design or build websites yourself — hire freelance contractors to do it for you! In most cases the designers and developers that you find on these sites are very reasonably priced.

Additional Website Design and Developer Resources to Help Your Business Guru.com http://www.guru.com eLance http://www.elance.com CraigsList (Computer Services) http://www.craigslist.com ScriptLance.com http://www.scriptlance.com GetAFreelancer http://www.getafreelancer.com One of the best do-it-yourself website design software tools is XSitePro http://www.xsitepro.com

In the next chapter we’ll show you how to import products for the retail market.


45

CHAPTER 10: Wholesaling Products to Retailers

CHAPTER 10

Wholesaling Products to Retailers There are more than 2.6 million retail gift stores in the United States and Canada, according to InfoUSA. The profit potential for importers is staggering! Granted, most retail business owners prefer to purchase products from companies they’ve worked with in the past and people they have relationships with. But that’s true with almost every business in existence. However, very few retail business owners will pass up the opportunity to make more money, and that’s what you bring to the table. Retail business owners will tell you which products they are most interested in receiving quotes for. You can scour Alibaba.com for those products, obtain a quote from the exporting company, and in turn submit a quote to your retailing customer. For example, one of the largest and most successful international gift shows for retailers today is the New York International Gift Fair. There are more than 2,800 exhibitors and 45,000 attendees. Most of the attendees are retail business owners and chains. New York International Gift Fair http://www.nyigf.com Most of the attendees would be very responsive to receiving quotes for products from you. One of the hottest product sectors in the retail industry is known as Home goods. Home goods include home improvement products, furniture, consumer electronics and home fashions. The service you can provide to retail businesses is invaluable. You can obtain products for these companies at a fraction of what they’re currently paying. On top of that, retail business owners won’t have to replace their current product wholesalers — which is a great selling point and a unique proposition. If you focus on the retailer’s customer and hot products you will have more business than you could possibly handle. What’s more, you won’t have to compete with the importers that work with the retail giants (unless you want to). In most cases, the small to medium-sized retailers will be your target market. 46


CHAPTER 10: Wholesaling Products to Retailers

Here’s a list of the products that retail gift stores purchase on a regular basis (according to RetailNet): 20-ounce tumblers (for drinking)

Tortilla makers

Espresso makers

Splatter screen (for cooking)

Ice cube trays

Wood salad bowls

Wood handle barbeque brush

Colored pencils

Sidewalk chalk

Giant coloring books

Flashing necklace

CD lens cleaner

Batteries

Balloons

Birthday party supplies

Fly swatters

Emergency rain ponchos

Men’s personal electronic trimmer

Scissors

Beach mat

Camping knife

Hands free cell phone headset

Pet toys

Painted vase

Retail News indicated recently that there are more than 22,000 products sold in retail business around the world! The opportunities for import entrepreneurs who want to sell products to retail business owners are unlimited. What’s more, you can start out small, with almost no capital, and build your business part-time.

Additional resources Retail Industry http://retailindustry.com Retail Forward http://www.retailforward.com RetailNet http://www.retailnet.com Chain Store Age http://www.chainstoreage.com The Retail Bulletin (UK news) http://www.theretailbulletin.com


47

CHAPTER 10: Wholesaling Products to Retailers Retailer Management http://www.retailernews.com/archives.html America’s Gift Show (excellent online resource for importers and retailers) http://www.americasgiftshow.com NRF Annual Conference and EXPO (The BIG Retail Event) http://nrfannual06.expoexchange.com

Approaching retailers is easy! The best prospects will be the retailers that already purchase products from importers, or wholesalers. In addition to the resources listed above you can also contact mailing list brokers that specialize in managing lists of retail business owners. A quick search on the Internet or Yellow Pages will produce hundreds of potential brokers. Once you have obtained a mailing list of retail business owners you can send them a simple letter of introduction. Almost everyone in business today has a website. You can include your website address in your letter. If you don’t have a website that won’t be a problem. You can build and post one on the Internet in no time flat. We’ve included some resources below to help you do just that. Here is a sample letter that could be used when contacting retail business owners:

Premium Gift Wholesale Co. 361 Ocean Drive Suite 322 Miami FL 33139 Date Ms Jessica Doe XYZ Retail 1111 Jackson Blvd. Kansas City KS

Dear Ms Doe: My name is John Brown. I’m the founder and President of the Premium Gift Company in Miami, Florida. We import thousands of products and gift items from around the world, and wholesale them to retailers at deep discounts. I’ve been to your website — so I’m familiar with your products and customers. Would you be open to reviewing some of our products and prices? No one will call you (unless you want us to)!

48


CHAPTER 10: Wholesaling Products to Retailers You can submit your request for specific products/prices via our website, email, fax or 24 hour voice mail system. We’ve been in business since 2002 — and we currently serve 103 retail businesses just like yours. We would love an opportunity to be of service to you! Please call, write or stop by our website today. Thank you. Sincerely yours,

John Brown Premium Gift Wholesale Co. http://www.premiumgiftwholesale.com (800) xxx xxxx [email protected]

P.S. We offer free shipping to your business for the first 6 months. That means there are NO shipping charges whatsoever for the first 6 months. All the more reason to give us a try!

In the next chapter we’ll show you how to become an import middleman!


49

CHAPTER 11: How to Become an Import/Export Middleman

CHAPTER 11

How to Become an Import/Export Middleman We’ve discussed obtaining products from overseas manufacturers for the wholesale market in Chapter 8. But there’s another twist to an import/export business — and that is becoming a “middleman.” This is the part of the business that enables you to compete with other importers and exports for major multimillion-dollar deals. The learning curve may be a bit steeper than other aspects of an import/export business — but the rewards and benefits are greater as well. Many countries and companies have insatiable appetites for thousands of different types of products. For example, there are companies that import millions of cubic tons of soybeans, tea, coffee, corn, wheat, steel, coal, copper, zinc and aluminum. Often times the purchasing directors place orders directly with manufacturers in other parts of the world. The problem is, although they purchase millions of cubic tons of product, in some cases they need more — a lot more! That’s where you come in! You will simply identify the companies that are importing the largest quantities of products and then find secondary suppliers for them. For instance, listed as a Buying Lead on Alibaba.com is a company in Singapore interested in 25,000 metric tons of Wheat (Durum). Singapore imports tens of millions of metric tons of wheat every year. They’re buying it from someone! All you need to do is locate a company that is able to fulfill this request. You could work on a retainer or commission basis to begin with if you don’t have the capital to “float” deals this size. In other words, you would locate a company that is able and willing to fulfill an order of this size (25,000 metric tons per month). Then you would contact this company and tell them you have a prospective buyer in Singapore. If they’re interested in submitting a quote they will need to “retain” your services. The exact wording of a proposal will vary. 50


CHAPTER 11: How to Become an Import/Export Middleman But most companies want to move product as quickly and trouble free as possible. You’ll find that many companies will be eager to work with you. But as you can see — this is a great income opportunity. On the other hand, if you do have the capital to float deals like this you would simply obtain a quote from the manufacturer or producer for 25,000 metric tons of wheat (durum). You would submit this quote (with a 15% premium added — your profit) to the interested party. If the quote were accepted you would arrange for payment and delivery. It’s that simple! What’s more, money flows very quickly in the import/export industry, unlike hundreds of other industries. An import/export middleman simply facilitates large product orders by bringing buyers and sellers together and making a “premium” or percentage of the deal.

Here’s a Short List of MAJOR Import and Export deals (tens of millions of dollars). All of the middlemen facilitating these deals earn a percentage. Crude Palm Oil – Mainland China Soybean Oil – Mainland China Wheat (durum) India, China, Pakistan, Malaysia Corn – Brazil, China, Singapore, India, Australia, Egypt, South Africa Fishmeal – China, India, Japan, Pakistan, Thailand, Korea, Chile, Argentina Ma Huang Extract – Mexico White Rice – Malaysia, China, Japan, UK Peanuts, Poland, Thailand, UAE Olive Oil – Portugal Saw Palmetto Extract – China Black Tea – Iran Cashews and Almonds – India Palm Oil – United States Bananas – Turkey Soybean Meal – Bangladesh Copper – China, Japan, India Steel – China, Mexico, India, Indonesia Crude Oil – all countries Natural gas – all countries The list of products goes on and on!


51

CHAPTER 11: How to Become an Import/Export Middleman The opportunities for import/export middlemen have never been greater. Once again Alibaba.com is a great resource to help you identify these deals. But Alibaba.com is not the only resource! There are dozens of websites to assist you in getting your import/export venture off the ground.

Additional Resources to Help You Become An Import/Export Middleman InfoBanc / Indian Bazaar http://www.infobanc.com/ Global Sources http://www.globalsources.com Thomas Global Register http://www.thomasglobal.com FITA http://fita.worldbid.com ImportEurope http://www.importeurope.com/ ForeignTrade.com http://www.foreign-trade.com/ Export Bureau http://www.exportbureau.com/ Berlinkauf – Trade Leads http://www.berlinkauf.com/ Muslim Trade Network http://www.muslimtrade.net/b2b/ Export Zone USA http://www.exportzone.com/ Trade India http://www.trade-india.com/

In the next chapter we’ll show you how to dominate the major search engines and directories. Dominating the search engines and directories will help promote your import/export middleman strategies, or promote specific products and services.

52


CHAPTER 12: Dominating Internet Search Engines and Directories

CHAPTER 12

Dominating Internet Search Engines and Directories If you’re planning to import products from companies and individuals overseas and sell them on the Internet, you will need to learn how to dominate search engines and directories. By dominating search engines we mean two things: 1) Your website appears prominently in the search results 2) Your advertising appears prominently around the search results In order to accomplish this you’ll need to understand a few basics regarding search engine technology and how it really works. This information and insight will give you a tremendous edge over most of the people that sell products on the Internet — or do any kind of Internet marketing.

How Search Engines and Directories Really Work Internet search engines are websites that help people find information. All Internet search engines perform three basic tasks: 

They search the Internet based on keywords or phrases that are entered by the user.



They keep an index of the words they find and where they find them.



They enable users to look for words or phrases found in that index.

The earliest search engines consisted of an index of a few hundred thousand pages and documents. Today, top search engines will index hundreds of millions of pages, and respond to tens of millions of queries per day! In this chapter, we’ll tell you how these major tasks are performed, and how Internet search engines put the pieces together in order to let you find the information you need on the Web. Before the Web became the most visible part of the Internet, there were search engines in place to help people find information on the Internet. Programs with names like “Gopher” and “Archie” kept indexes of files stored on servers connected to the Internet. This dramatically reduced the amount of time required to find programs and documents. Start Your Own Internet Import/Export Business

53

CHAPTER 12: Dominating Internet Search Engines and Directories In the late 1980s, being a serious Internet user meant knowing how to use gopher, Archie, Veronica and the rest. Most Internet users today limit their searches to the Web, so we’ll deal with the search engines that focus on the contents of Web pages. In order for a search engine to tell you where a file or document is, it must be found. To find information amidst the hundreds of millions of Web pages that exist, a search engine employs special software robots called spiders. Spiders build lists of the words found on Web sites. When a spider is building its lists, the process is called Web crawling. In order to build and maintain a viable list of words, a search engine’s spiders have to look at a lot of pages.

How Does a Spider Start Traveling Over the Web? The obvious starting points are typically lists of heavily used servers and popular pages. The spider will begin with a popular site, indexing the words on its pages and following every link found within the site. In this way, the spidering system quickly begins to travel, spreading out across the most widely used portions of the Web. Google.com, for instance, began as an academic search engine. Google’s initial system used multiple spiders. In order to keep everything running fast, Google created a system to feed necessary information to the spiders. The early Google system had a server dedicated to providing URLs to the spiders. Rather than depending on an Internet service provider for the domain name server (DNS) that translates a server’s name into an address. Google had its own DNS with a view to keeping delays to a minimum. When a Google spider looks at an HTML web page, it notes two things: 

The words within the page



Where the words were found

Words occurring in the title, subtitles, meta tags and other positions of relative importance were noted for special consideration during a subsequent user search. A Google spider was built to index every significant word on a page, leaving out the articles “a,” “an” and “the.” Other spiders use different approaches. The different approaches usually make the spider operate faster, and allow a user to search more efficiently. For example, some spiders keep track of the words in the title, sub-headings and links, along with the 100 most frequently used words on the page. These spiders also keep track of each word in the first 20 lines of text. Lycos is said to use this approach to spidering the Web. Other search engines and spidering systems, like AltaVista, index every single word on a page, including “a,” “an,” “the” and other “insignificant” words. The push to completeness in this approach is matched by other systems in the attention given to the unseen portion of the Web page, the meta tags. 54


CHAPTER 12: Dominating Internet Search Engines and Directories

What are Meta Tags and What Difference Does It Make? Meta tags enable the owner of a web page to specify key words or concepts under which the page will be indexed. This can be really helpful, especially in cases in which the words on the page might have double or triple meanings — a meta tag can guide the search engine in choosing which of the several possible meanings for these words is correct. There is a downside with over-reliance on meta tags, though. A careless or unscrupulous page owner might add meta tags that fit very popular topics but have nothing to do with the actual contents of the page. To protect against this, spiders will correlate meta tags with page content, rejecting the meta tags that don’t match the words on the page.

Building the Index Once the spiders have completed the task of finding information on Web pages the search engine must store the information in a way that makes it useful (actually this task is never actually completed — spiders are always crawling). There are two components involved in making the gathered data accessible to users: 

The information stored with the data



The method by which the information is indexed

In most cases a search engine could just store the word and the URL where it was found. But in reality, this would limit the search engine in a big way because there would be no way of telling whether the word was used in an important or a trivial way on the page. In other words, there would be no way of building the “ranking list” that tries to present the most useful pages at the top of the list of search results. In order to deliver more results, most search engines store more than just the word and URL. An engine might store the number of times that the word appears on a page. The search engine would then assign a weight to each entry. Each commercial search engine has a different formula for assigning weight to the words in its index. This is one of the reasons why a search for the same word on different search engines will produce different lists, with the pages presented in different orders. Regardless of the precise combination of additional pieces of information stored by a search engine, the data will be encoded to save storage space. An index has a single purpose: It allows information to be found as quickly as possible. There are a number of ways to build an index, but one of the most effective ways is to build a hash table. In hashing, a formula is applied to attach a numerical value to each word. The formula is designed to evenly distribute the entries across a predetermined number of divisions. This numerical distribution is different from the distribution of words across the alphabet, and that is the key to a hash table’s effectiveness. Start Your Own Internet Import/Export Business

55

CHAPTER 12: Dominating Internet Search Engines and Directories In English, there are some letters that begin many words, while others begin fewer. You’ll find, for example, that the “M” section of the dictionary is much thicker than the “X” section. This inequity means that finding a word beginning with a very “popular” letter could take much longer than finding a word that begins with a less popular one. Hashing evens out the difference, and reduces the average time it takes to find an entry. It also separates the index from the actual entry. A hash table contains the hashed number along with a pointer to the actual data, which can be sorted in whichever way allows it to be stored most efficiently. The combination of efficient indexing and effective storage makes it possible to get results quickly, even when the user creates a complicated search.

Search Engine Optimization (SEO) and Search Engine Marketing (SEM) Search engine optimization is the technique of fine-tuning your website so it appears more frequently and with a higher ranking in search engines, and thereby increasing traffic to your site. Each search engine compiles a database of web pages, which are then ranked by relevance when a particular search term is entered. Each search engine uses different algorithms in order to determine a web page’s relevance for a given search. But there are a number of things you can do to help a web page receive a higher ranking in search results. Search engine marketing is the implementation of strategies to elevate a site’s page ranking in search engines. A strong search engine ranking enables you to connect more easily with people who are looking for the products or services that you offer. Search engine marketing would include purchasing keywords and phrases (advertising). The two most popular types of advertising on search engines are keyword buys/cost per click (CPC) and flat rate keyword buys.

In Order to Dominate Search Engines and Directories You Must: A) Build your website to accommodate different spider technologies and especially the technologies of the top five search engines: Google, Yahoo!, MSN, Lycos and AOL. B) Purchase relevant keywords and/or phrases in the top five search engines and top directories on a cost per click basis and/or flat fee basis Building your website to accommodate different spider technologies can be as simple as placing “meta tags” in your source code. There are hundreds of resources and books on programming and HTML that can help you or your webmaster set this up properly. Purchasing relevant keywords in the top search engines and directories is very easy to do. All of the top search engines have step-by-step instructions on their sites. In most cases, it will take about 20 minutes to purchase all of your keywords on each engine or directory. What’s more, all of the major search engines have an administration section available when you set up your account and purchase keywords. The administration section will help you to revise, edit, change or delete keywords — as well as purchase new keywords instantly. 56


CHAPTER 12: Dominating Internet Search Engines and Directories In the next chapter we’ll discuss the benefits of having powerful linking strategies in place. On the surface this topic might appear to have nothing to do with an import/export business. But entire World Wide Web is built on hypertext links! If you’re going to do business on the Internet, or market anything on the Internet — it’s absolutely crucial that you understand linking strategies.


57

CHAPTER 13: Powerful Linking Strategies

CHAPTER 13

Powerful Linking Strategies Linking strategies not only improve your “page ranking” on most of the top search engines. They will also increase traffic to your website, and enable other sites and people to link to you and improve the “viability” of your site. One of the grandmasters of linking strategy and techniques is Eric Ward. You can learn about Eric’s linking services and URL announcement services here: http://www.ericward.com You can also listen for FREE to a 30-minute, power packed interview that Eric gave to SEO-Radio on Linking Strategies here: http://www.seoradio.com/20050322-eric-ward-on-link-publicity.html Either way you look at it linking strategies are absolutely crucial to the success of your website as it relates to traffic, popularity and search engine page ranking. Here are a few things to keep in mind (courtesy of Eric Ward):

Linking’s Holy Grail: The Passively Obtained Backlink A passively obtained backlink is nothing more than a link to your site that you had nothing to do with obtaining. You didn’t know a thing about it. Didn’t ask for it, didn’t pay for it, and didn’t swap for it.It just happened. The search engines love passive links like this. Why? Because they can trust them. Here’s an example. You sell organic produce. You have a web site. You sell your produce all over the U.S., to hundreds of stores, food chains, and specialty markets. You’ve never once asked anyone to link to your site, yet your site has several hundred links. How can this be?

Reason 1: Many of the stores you sell your organic produce to also have web sites, and on their sites they have a section named “Suppliers”. In this section they list the companies (like yours) that they purchase products from, and when those companies have web sites, they make a link out of the company name.Bingo, a passively obtained backlink for your organic produce company.

Reason 2: You are going to attend an upcoming trade show for your industry. It just so happens that the trade show has a web site, and on the trade show site there’s a section with links to the web sites of all the companies that are going to attend. Once again, another passively obtained backlink. 58


CHAPTER 13: Powerful Linking Strategies These are just a couple of reasons a site might have links they didn’t seek. Search engines judge these types of links as being a better indication of the quality of the content on the site they are linked to than the links you DO actively pursue and obtain. This makes sense to a certain point, since the basic nature of the web from the early days was a massive network of passively obtained links. Back in 1993, nobody was seeking links in order to improve their search rankings, because none of the search engines looked at links. They looked on-site only. But here’s a dirty little secret. Many links that appear to have been passively obtained are in fact actively obtained. How do I know this? Because many of the links I mentioned for the organic produce company in “Reason 1” (above) actually came about because I requested them. Many of the grocery web sites existed before the organic produce company had a web site, so the grocery store sites couldn’t link to the organic produce site, since there was nothing to link to. But once the organic produce company launched their web site, there was something for the grocery store sites to link to. The only catch is that all those grocery sites have no idea the organic produce company has launched a site, so link requests HAVE to be made. What appears to be a passively obtained backlink is in fact an actively obtained backlink. All this masks the more important lesson: Every web site has its own universe of inbound links it can reasonably expect to come about from a passive approach. But you can’t just sit back and wait for a webmaster somewhere to happen upon your site and link to it. The key is to be strategically active, rather than randomly active. Make sure you know which sites are the best targets for your link requests. If you aren’t sure, seek advice from someone you trust. The goal is not to trick the engines into thinking an actively pursued link is a passive link. It’s to make sure you obtain the links your site has a natural and logical reason to obtain. Identifying the natural and logical targets is 90% of the battle. Until next time, I remain, Eric Ward, The Link Mensch

Using Google to Identify High Quality Link Targets Building links to your site improves rankings in certain search engines. Not all of the search engines put as much weight on inbound links, but one that does is Google. Google has become the 800-pound gorilla in the search engine wars, seemingly overnight. Did you know you could use Google to identify the sites you need to have links from? Not all links are created equal, and Google know this. They know that FFA links are useless, as are link farm links. They help you clog your own inbox and that’s all. In Google’s case, the sheer number of links doesn’t determine your ranking. Google’s ranking algorithm takes into account each link’s importance along with other factors like the proximity of your search keywords in the documents. In other words, it’s not just about the number of sites that link to a given page, but also the importance of those sites (measured by the links to each of them). Google has given a name to its ranking algorithm for determining a web page’s importance; it’s called PageRankTM. Start Your Own Internet Import/Export Business

59

CHAPTER 13: Powerful Linking Strategies In order to accurately view a page’s PageRank, according to Google, you will need to install the Google Toolbar into your Internet Explorer. Download it from http://toolbar.google.com/ You’ll notice after it’s installed that there’s a green “PageRank” meter. That meter is your window into the inside of Google, telling you how important and high-quality Google considers your site to be. And thus how well it’s going to rank in a relevant search. Placing your cursor over the meter will display the numerical rating, an integer value between 1 and 10. Granted the PageRank meter isn’t very precise, but nonetheless it is still immensely illuminating. You can learn more about “PageRank” at: http://www.google.com/technology/ Once the Google toolbar is installed, you can start visiting sites that you want to consider requesting links from to see how good their PageRanks are. Those with high PageRanks are the ones to approach for reciprocal links, because they’ll help you the most with improving your own PageRank. Don’t forget that your PageRank is only part of the equation. A web page must still have enough content on it for Google to ascertain its theme. According to the CTO of Google (see the interview at http://www.ibizinterviews.com/craigs1.htm for more), the key to ranking well in Google is two-fold: having content-rich web pages, and building a web of links to your site from other reputable, relevant sites.

Looking for Links In All The Wrong Places? In their frenzy to build links to curry favor with the engines, web site owners miss a far more important audience using topical tools. Most people will tell you that links from Yahoo and DMOZ to your site are vital, and to a certain extent I agree. Who wouldn’t want to be listed with two of the most widely used directories in the world? It’s what marketers do after they get the Yahoo and DMOZ links that can make or break them. Pursuing links just for Pagerank and Link Popularity in the major search engines is not going to go away, as much as I wish it would. And by trying to impact Pagerank artificially, Pagerank as it is determined now is doomed. Whether that happens in 2005 or 2010 I don’t know, but once thousands of sites are after links for reasons other than relevancy, no link can be trusted enough to reward it, right? Aside from the ethics of link building, pagerank, etc. let’s discuss sites and search engines dedicated to niche topics. Niche and topical search engines and directories can bring your site highly targeted traffic, maybe not a stampede of traffic but a steady trickle of perfectly qualified users. And while some marketers are quick to claim nobody uses niche search engines because they’ve never heard of them, I can tell you from ten years of experience they’re wrong. It probably wouldn’t surprise you to find out there were search engines devoted to popular topics like financial web sites or even Fish web sites. But for proof that search engines are truly going vertical, look no further than ElvisFind, a search engine and directory that only indexes content about Elvis Presley. At the time of this writing ElvisFind contained 320 Elvis related web sites in 9 categories. Obviously, if your site doesn’t have content about Elvis Presley, you have no reason to request a link from them or submit your site to their editors. 60


CHAPTER 13: Powerful Linking Strategies But if your site sells vacation packages to Memphis and has a “Spend the day at Graceland” package, well, suddenly ElvisFind makes a lot more sense. Some specialty search engines focus on more than just a specific topic. SearchEdu.com is a good example. This search engine indexes pages from educational sites hosted on .edu domains. I use this search engine to find links to pages at educational sites, since for my kind of clients’ educational links pages are extremely useful (and they are pretty good for improving Pagerank too). One nice aspect about specialty search engines is they typically don’t charge for links (although a few have started charging), and better still I’ve noticed they add links and index sites far quicker than most of their bigger brethren. There isn’t a sandbox at ElvisFind... While there are hundreds of specialty search engines available, it can be hard to find the best ones in any particular subject area. I have included some of the tools I use below. Once you find a specialty search engine, the link request or site submission process is usually fairly straightforward. Look for the “add your site” link and follow their directions. Options may even be available for paid links or sponsored links. Here are some online tools you can use to find specialty search engines. Danny Sullivans’ List of Directories and Search Engine’s by Topic http://searchenginewatch.com/links/specialty.html SearchEngineGuide http://www.searchengineguide.com/searchengines.html Open Directory Specialized Search Engines Category http://dmoz.org/Computers/Internet/Searching/Search_Engines/Specialized/ InvisibleWeb http://www.invisible-web.com/

Powerful linking strategies can propel your import export business into the stratosphere. In the next chapter we’ll walk you through the process of buying keywords on the major search engines. Keyword advertising will enable you to promote products to a very targeted audience of eager buyers. We’ll dispel all of the popular misconceptions and walk you through the keyword buying process step-by-step.


61

CHAPTER 14: Buying Keywords and Phrases on Search Engines

CHAPTER 14

Buying Keywords and Phrases on Search Engines You can purchase keywords and phrases in more than 200 top search engines and directories with a view to marketing your import/export business and products. There are currently two ways or methods for purchasing keywords and phrases on search engines. 1) Cost per click (CPC) 2) Flat fee Both of these methods have advantages and disadvantages. Let’s talk about why someone with an import/export business would purchase keywords and/or phrases on a search engine or directory. Let’s say that you’re reselling products on the Internet that you’ve imported from China. Let’s also say that you have a retail component and a wholesale component to your business. On the retail side you are targeting individuals or businesses that only purchase products in small quantities. — Let’s say that your product is tee shirts. On the wholesale side you are targeting retail stores, shops and the like. The best way to approach this is to keep the two components completely separate. That’s not what most people do — but most people do not understand how the Internet works. If someone comes to your retail site and checks out your products — and then stumbles onto your wholesale section — they’ll be shocked to learn they’re paying up to ten times the wholesale price (or more)! That’s true even if you have special or secured access to the wholesale section. It’s much better to keep the two components (retail and wholesale) completely separate and on different websites (and domains). Okay — let’s talk about purchasing keywords and/or phrases in the top search engines. Google’s AdWords is likely the most popular advertising network for search engine keyword purchases on the Internet. The Google AdWords “system” is really quite simple. 62


CHAPTER 14: Buying Keywords and Phrases on Search Engines Advertiser’s “bid” for specific keywords and phrases in an open market. Words like: “100% cotton tee shirts,” “Cotton tee shirts” and “Colored cotton tee shirts” are fairly popular. In fact, all of these words are fairly popular based on Google AdWords Keyword Relevance Tool: https://adwords.google.com/select/KeywordSandbox You can also choose expanded broad matches like: “t shirt,” “customized t shirt” or “hilary duff t shirt.” Once you’ve selected the keywords that you want to purchase you’ll begin bidding on them. Let’s say that you are the high bidder and are able to purchase the keyword/phrase, “100% cotton t shirt” and your “bid” amount is $1 per click. That means when someone enters the term or phrase “100% cotton t shirt” into the Google search box your keyword “ad” matching that phrase would appear on the right hand side of the search results page. There will be other advertisers featured with you — but your ad should appear first on the page if you are the highest bidder for that word. In your Google AdWords account you can set a “spending cap” too. You can limit the amount you spend each month for advertising keywords by simply specifying a spending cap. Let’s say that you have set your spending cap at $500 per month. That means if you receive 500 clicks (at $1 each or $500) your ad would be shut off automatically — and the next highest bidder would take your spot. Granted, click fraud or clicks that are generated maliciously or fraudulently is a problem. But generally speaking, it’s manageable. If you received 500 unique click thrus from targeted buyers there’s a very good chance a percentage of these people will make a purchase on your website. Hopefully you can see the value of purchasing the right keywords on the right engines — because you receive targeted traffic and business. The downside to cost per click keyword programs is obviously cost. The best and most sought after keywords and phrases can be very expensive. If you have a limited budget you’ll have a hard time competing on this playing field with large advertisers. Some advertisers will purchase hundreds or even thousands of keywords and/or phrases. An alternative to cost per click keyword buy programs is flat rate keyword buys like those offered on the search engine ExactSeek: http://www.exactseek.com/featured_listings.html ExactSeek also offers one of the best “bulk Keyword Buy Programs” on the Internet. Granted, ExactSeek traffic pales in comparison to Google’s (ExactSeek currently receives about 150 million unique searches a month), but it’s still pretty formidable and costs a lot less. Whatever engine or approach you prefer buying keywords and phrases in, it’s a great way to market your import/export products and services. Start Your Own Internet Import/Export Business

63

CHAPTER 14: Buying Keywords and Phrases on Search Engines

Gain insight into consumer buying habits and uncover profitable niche markets with these websites and tools Overture Keyword Suggestion Tool http://inventory.overture.com/d/searchinventory/suggestion/ Yahoo Leading Searches http://buzz.yahoo.com/ Google Search Trends - Zeitgeist http://www.google.com/press/zeitgeist.html Amazon Movers and Shakers List http://www.amazon.com/exec/obidos/tg/new-for-you/movers-and-shakers/-/ books/104-6832628-4759129 Amazon Best Sellers http://www.amazon.com/exec/obidos/tg/new-for-you/bestsellers/-/books/ Wordtracker - Advanced Keyword Analysis Tool http://www.highertrustmarketing.com/part/wordtracker Adword Analyzer http://www.infoproductcreator.com/part/adwanalyze URLTrends http://www.urltrends.com

The “Top Tier” Search Engines with Keyword Buy and/or Pay Per Click Programs Yahoo! http://www.yahoo.com Google http://www.google.com MSN http://www.msn.com AOL http://www.aol.com Go.com http://www.go.com

64


CHAPTER 14: Buying Keywords and Phrases on Search Engines Overture (now part of Yahoo!) http://www.overture.com SearchScout http://www.searchscout.com Lycos http://www.lycos.com AltaVista http://www.altavista.com Excite http://www.excite.com

The Top 20 “Second Tier” Search Engines with Keyword Buy and/or Pay Per Click Programs: eSpotting http://www.espotting.com ExactSeek http://www.exactseek.com FindWhat http://www.findwhat.com LookSmart Listings http://listings.looksmart.com Enhance.com http://www.enhance.com ePilot.com http://www.epilot.com Kanoodle http://www.kanoodle.com Dogpile http://www.dogpile.com Vivisimo http://www.vivisimo.com HotBot http://www.hotbot.com


65

CHAPTER 14: Buying Keywords and Phrases on Search Engines Kartoo http://www.kartoo.com Mamma.com http://www.mamma.com SurfWax http://www.surfwax.com Excite http://www.excite.com Fazzle http://www.fazzle.com InfoGrid http://www.infogrid.com IXQuick http://www.ixquick.com MetaCrawler http://www.metacrawler.com Turbo10 http://www.turbo10.com Lycos InSite http://insite.lycos.com Buying keywords on the top Pay Per Click (PPC) Engines will help you target eager buyers for your imported products. Another popular alternative to PPC engines are flat fee keyword buys like those offered on ExactSeek.com. In the next chapter we’ll show you the secrets of effective online advertising.

66


CHAPTER 15: The Secrets of Effective Online Advertising

CHAPTER 15

The Secrets of Effective Online Advertising Many entrepreneurs walk away from Internet advertising disillusioned, discouraged and/or broke. In most cases, these entrepreneurs did not understand the concept of “testing” ad copy and offers. What’s more, people do not typically understand which advertising mediums are the best for a particular product or service. For example, running a conventional banner (468 x 60 pixels) on “general interest” websites and portals is generally a waste of time and money. If a banner is run on a targeted website or portal there’s a much higher probability that it will be “clicked” or responded to. Generally speaking, conventional banners are a waste of time on the Internet these days because the click thru rate is abysmal. In addition, running a “text link” advertisement on a website or portal that already has dozens of text links is a waste of time and money too – in most cases. The secret to effective online advertising is a “targeted” audience and achieving “direct response”. Direct response advertising has many shapes and sizes but it always focuses on targeted, qualified prospects. Most entrepreneurs target “the masses” with mass media advertising tools like television, newspapers, radio, billboards, generic email blasts, or bulk snail mail. What’s more, you don’t need a lot of money to run effective online advertising campaigns if you do it right. The Internet is a direct marketer’s paradise! The key is to focus on a very targeted audience. Mass-market advertising does the exact opposite. Does mass-market advertising work? It depends on the offer, ad copy and timing. Most of the time it will be disastrous. Mass-market advertising could be much more effective if it focused on a target audience. According to most advertising agencies a “prime” target audience would be anyone in the 18 to 34 year-old age bracket. We all know there’s a big difference between an 18 year-old and 34 year-olds. What’s more, this is NOT a targeted audience. It is a huge slice of the population. Start Your Own Internet Import/Export Business

67

CHAPTER 15: The Secrets of Effective Online Advertising

A highly targeted audience profile might look like this: 

20 year-old college student



Internet, iPod, Web savvy



Frequent online buyer of iPod accessories, software, music, books and clothes



Disposable income — credit card carrier



Most recent purchase — dozens roses from ProFlowers.com

That is a targeted audience and prospect! The secret to effective online advertising is to think in terms of direct response, targeted audience and “A Prospects.” An “A” prospect in this context would be someone who has recently purchased the same thing (or similar) that you are selling. Most of the people that are doing business online today overlook the “A” prospect formula – thus costing them a lot of money in wasted advertising and profits. What does this mean in the real world? If you’re selling the products that you’ve imported from overseas companies you’ll want to advertise to a targeted audience. Google and the other search engines enable you to purchase keywords and phrases that people might use to find your products. But these “searchers” are not always a targeted audience or “A prospects.” Just because someone is searching for “brushed marble tile” does not mean they are in the market to buy it. It could be distributor-researching competitors. It could be someone looking around because they might buy “brushed marble tile” someday. What’s more, someone might be searching “brushed marble tile” because they purchased those words in Google and they want to see when it comes up on the search result pages! The point is not all of the people searching for “brushed marble tile” will be targeted, “A” prospects. That said, Google and the other top search engines can be very effective when it comes to advertising. The difference is you can “test” specific keywords and phrases, monitor the click thru and more importantly the click thrus that convert to sales.

Targeted Email Newsletters Targeted email newsletters are perhaps THE most overlooked advertising medium on the Internet. There is a world of difference between “generic email promotions” and promotions that are sent to targeted, opt-in subscribers. Most of the large advertising agencies try to use “generic email lists” the same way they use snail mail lists. That’s a big mistake. 68


CHAPTER 15: The Secrets of Effective Online Advertising Targeted email newsletter subscribers have opt-in and/or requested specific information or publications. Generic email lists typically start out with someone making a specific purchase or request for information. But as months and years pass these lists are used hundreds of times — over and over — and become “watered down” and in most cases irrelevant. For example, someone may have requested information on a new business directory. The publisher sends the subscriber the information that was requested. But the publisher continues to send the requester email every week for a year offering other products and services. Then the publisher sells his or her company and the new publisher begins sending email three times a week selling everything from business directories, to website hosting, ecommerce products and more. This is why people end up receiving hundreds of email that has nothing to do with the original request. It’s called “generic email” — it’s a common occurrence but an accepted practice for many advertising agencies and email list brokers. Targeted email newsletters on the other hand often address topics or categories rather than a specific product. Think of email newsletters as targeted email publications. There are millions of email newsletters circulating on the Internet today covering everything from animal health to network security. The best thing about them is advertising is usually reasonably priced. On top of that, in a print publication or magazine you may have 20 or 30 advertisers. Most email newsletters are typically only a standard web page in length and only feature two or three advertising messages. SiteProNews, for example, is an email newsletter devoted to professional webmasters and eBusiness site owners. It’s published three times per week. The newsletter only features three advertisers per issue. There are usually only three advertising “spots” or positions per issue. The advertising spots are fairly large (by industry standards) and measure 400 x 175 pixels. This particular email newsletter reaches a very targeted audience and has 500,000+ opt-in subscribers.

Blogs, RSS feeds and Podcasts Blogs, RSS feeds and Podcasts have not really caught on as an Internet advertising medium. Part of the problem is the audiences are usually too small, and oftentimes too targeted. The upside is that advertising on blogs, RSS feeds and Podcasts is relatively inexpensive. Start Your Own Internet Import/Export Business

69

CHAPTER 15: The Secrets of Effective Online Advertising Here are a couple of resources for advertising on these mediums: BlogAds http://www.blogads.com RSS –Ads http://www.rssads.com/rss/default_rss.jsp Podcast Directory http://www.podcastdirectory.com/advertising/

Internet and Email Discussion Lists Advertising is generally frowned on in Internet and email discussion lists. But everybody does it — even if it’s only advertising his or her opinion. The catch is to have a signature that advertises your website URL. These can be very profitable — and especially when you’re on targeted discussion lists with other movers and shakers. Highly recommended. Tile.Net Discussion List Directory http://www.tile.net/lists Google Groups http://groups.google.com Topica http://lists.topica.com CraigsList http://www.craigslist.com

The key to effective online advertising is to focus on a targeted audience. Buying advertising on the major search engines (keyword ads), email newsletters, blogs, RSS feeds, podcasts and discussion lists can be very effective. In the next chapter we’ll show you how to resell imported products through classified ads.

70


CHAPTER 16: Reselling Imported Products with Online Classified Ads

CHAPTER 16

Reselling Imported Products with Online Classified Ads Online classified ads are probably the most underused method for advertising and marketing in the world. Granted, thousands of new classified websites have been launched in the past few years with an eye to taking revenue from print newspapers and magazines. But the problem with most of these sites is actual real-time traffic. What’s more, whenever you ask the site’s owners or customer service for verified traffic results and statistics they often misplace your email — by accident of course. The secret to using online classified ads to sell anything is: A) Targeted real-time traffic B) Proven products C) A website that can handle a sale quickly (without having to jump through rings of fire) One of the largest and most successful online classified sites is called CraigsList http://www.craiglist.com People from every walk of life visit CraigsList on a daily basis looking for jobs, apartments, relationships, automobiles, advice, companionship, freelance experts and more. In the old days you would place an ad on an online classified site and wait until someone responded. But that has all changed. Today you can automate the process with software and manage your online classified campaign with a couple of clicks. On top of that, sites like ClassifiedClub http://www.classifiedclub.com/submissionsorder.html that offer do it yourself classified submission software and/or professional software submission services. Due diligence is an absolute requirement when it comes to classified submission software and submission services — not all are created equal! The best way to find out if classified submission software or a submission service is legitimate is to ask people that have used it. The best place to do that is on webmaster and eBusiness marketing forums — WebmasterWorld.com and WarriorForum.com. Online classified sites can be a tremendous source of customers and targeted traffic if used correctly. Start Your Own Internet Import/Export Business

71

CHAPTER 16: Reselling Imported Products with Online Classified Ads Most online classified sites have very little traffic — let alone targeted traffic. You’ll want to focus on the top 15 or 20 online classified sites that have significant targeted traffic. It’s a good thing to remember that most people come to online classified sites to save money — they’re looking for a deal. On top of that, other than automobiles, concert tickets or cruise vacations, lower priced products will always sell better. Information products like eBooks, eReports and software programs priced under $30 often perform well on classified sites, too.

How to Sell Products Successfully with Online Classifieds 1) Place the ad in the right category 2) Powerful headline — short and to the point — include benefit 3) The right product (stick with items that are already selling — i.e. iPods, Cell phones, wellness products, etc. 4) Priced to sell 5) Include a link to a website that can handle the sale quickly

The Top 20 Online Classified Websites Google Local Classifieds (coming soon) http://local.google.com Inetgiant http://www.inetgiant.com TraderOnline http://www.traderonline.com AOL Classifieds http://classifieds.aol.com US Free Ads http://www.usfreeads.com Sell.com http://www.sell.com CraigsList http://www.craigslist.com Yahoo! Classifieds http://classifieds.yahoo.com

72


CHAPTER 16: Reselling Imported Products with Online Classified Ads Live Deal http://www.livedeal.com Ziply http://www.ziply.com AdPost http://www.adpost.com SuperClassifieds (classified site directory) http://www.superclassifieds.com Half.com http://www.half.com AdQuest http://www.adquest.com SFGate http://www.sfgate.com/classifieds AmericaNet http://www.americanet.com/Classified Loot.com http://www.loot.com eClassifieds http://www.e-classifieds.net ClassifiedAds.com http://www.classifiedads.com eDirection http://www.edirection.com

Online classified ads are a great way to advertise to a very targeted audience of prospective buyers (looking for a good deal). Online classifieds are typically less expensive than all other forms of advertising. Some classified sites like CraigsList and Yahoo! reach millions of people every month. Granted, you probably won’t get rich by selling products through classified ads — but it can provide a nice supplemental income stream. In the next chapter we’ll show you the benefits of having eStores and how to market them successfully.


73

CHAPTER 17: How to Build and Market eStores “On Demand”

CHAPTER 17

How to Build and Market eStores “On Demand” One of the best ways to sell imported or exported products on the Internet is with online or eStores. Ten years ago eStores were expensive, complicated and required hours of sophisticated programming. That has all changed — for the better. Today there are hundreds of eStore options available to entrepreneurs. What’s more, many of the online stores today are inexpensive and incredibly easy to maintain.

The 4 Most Important Aspects of an Online Store (according to Amazon.com — one of the largest and most successful!): 1) The shopping cart must be easy to use and trouble free 2) You must be able to accept all payment methods in multiple currencies (including PayPal, eChecks and paper checks) 3) The product photos and images must be professional quality, and clearly marked with a price and description 4) The order confirmation must be clear and concise — and be shown on the Web upon completion as well as with email Whenever you begin selling products online to the public you should test the system yourself. That doesn’t mean delegating the task to a webmaster, programmer, graphic designer, customer service person, web host or customer. We recommend that you test the system yourself using your credit card and money! Believe it or not — most of the people that do business online never bother to check the ordering process themselves. They just assume the system has been checked and doubled checked. If you place an order on Amazon.com you will see how the ordering process and confirmation should look. The key is to enable users to place orders (and send money!) as quickly and efficiently as possible. If you do it right in the beginning you won’t have to mess with it down the road. 74


CHAPTER 17: How to Build and Market eStores “On Demand” One of the most difficult aspects with respect to programming and database administration for any online store is the inventory and shopping cart process. But there’s no need to get overwhelmed. There are dozens of online store systems available on the Internet today that do most of the work for you. In most cases it’s a good idea to start small and gradually increase the size of your inventory (if you so desire). If you’re only going to focus on and offer a few products — that’s even better because it will be incredibly easy to maintain and support such a system. What do we mean by an online store that offers products “on demand”? Simply put — you should be able to instantly create a product and/ or product category in your online store. For example, Hurricane Katrina in 2005 was a devastating event. Millions of people were displaced. Many entrepreneurs saw an opportunity to help people by selling “on demand” products that were in demand, like waterproof flashlights, first aid kits, oxygen tanks, food, clothing and even donations to the American Red Cross. Important Note: Offering donations to non-profit organizations like the American Red Cross can be tricky. There is often more involved than just placing a “Donate Here button” in your online store. Be sure to check the requirements, policies and procedures for each non-profit group before offering this option in your online store. Here’s another example: A national TV news magazine ran a special feature on the health benefits of Chinese ginseng. People began searching Google in droves to find places to purchase Chinese ginseng online. If you didn’t offer ginseng in your online store — you could quickly add it and include a professional photograph. You would need to have the product on hand or in inventory in order to fulfill the demand. You could also purchase the keywords “Chinese ginseng products” (and maybe the name of the television show that broadcast the special feature!) on Google or the other top search engines in a couple of minutes. That’s what we mean by building and marketing online stores and products — on demand… the objective being to sell products “on demand” quickly and easily.

Here’s a List of the TOP TEN eStore Shopping Cart Applications and Services: MonsterCommerce http://www.monstercommerce.com MIVA http://www.miva.com Start Your Own Internet Import/Export Business

75

CHAPTER 17: How to Build and Market eStores “On Demand” Volusion http://www.volusion.com SalesCart http://www.salescart.com ShoppingCartPlus http://www.shoppingcartsplus.com ShopFactory http://www.shopfactory.com KingCart http://www.kingcart.com Storefront http://www.storefront.net AbleCommerce http://www.ablecommerce.com EasyCart http://easycart.com Build an Online Store or Shopping Cart Yourself (open source article) http://www.devx.com/opensource/Article/26654

Plug ‘N Play Online Stores (these can be set up in just a few minutes) Yahoo! Online Stores http://smallbusiness.yahoo.com Bizland http://www.bizland.com InstantOnlineStores http://www.instantonlinestores.com Froogle Merchants (Google) https://www.google.com/froogle/merchants DollarDays http://www.dollardays.com/openastore.asp WirePlanet http://www.wireplanet.com/svc_webstore.asp

76


CHAPTER 17: How to Build and Market eStores “On Demand” BuyIt-Sellit http://www1.buyitsellit.com 2Checkout http://www.2checkout.com eBay Storefronts http://pages.ebay.com/storefronts/seller-landing.html Amazon.com Merchant (and zShops) http://www.amazon.com

Online stores can be your key to riches with an import/export business. Think about it. You can import products for pennies on the dollar and resell them on the Internet for 100%, 200%, 300% markups or more! On top of that, online stores are easy to set up, maintain and market. But it’s important that you launch your online store today! Don’t waste your time thinking about how it will work. Take action. Check out Yahoo! Online Stores, Froogle, Bizland or even PayPal Stores! You’ll see how easy it is to launch a profitable online store. Don’t let this opportunity pass you by. In the next chapter we’ll help you get started. The Fast Start Strategy is designed to help you launch an import/export business as quickly and simply as possible. Let’s start making money with this business!


77

CHAPTER 18: ACTION PLAN: Fast Start Strategy — Completing Your First Deal

CHAPTER 18

ACTION PLAN Fast Start Strategy – Completing Your First Deal The first step toward building a profitable Internet based import/export business is taking the right action. That is what this chapter is designed to help you do. After completing your first deal your entrepreneurial juices will start to flow. New ideas, approaches and methods will begin appearing as if out of nowhere. Ask any successful entrepreneur what the single most important element to their success is and invariably they will tell you — taking action on an idea. Bill Gates, the founder of Microsoft (and richest man in the world according to Forbes magazine), said in an interview recently that hundreds of people were developing software programs and operating systems for personal computers. The one thing that set him apart was that he acted on his idea of becoming “the” operating system for personal computers. Taking action — no matter how large or small — will make a difference in your business success. Once you’ve decided to take action the next step will be to determine what area of importing and exporting you would like to focus on initially. Don’t make this step too difficult — it’s simply a matter of what aspect of this business interests you the most. If you’re interested and become passionate about a specific area the details and money will follow if you take the right action.

Four Main Areas of an Internet Import/Export Business 

Matching Buyers with Sellers



Import Products for the Wholesale Market



Exporting Products to Overseas Buyers



Importing Products for Resale on the Internet

We‘ll develop an Action Plan for each of these areas. Your plan may be slightly different, but this will give you a start in the right direction. 78


CHAPTER 18: ACTION PLAN: Fast Start Strategy — Completing Your First Deal

Matching Buyers with Sellers This is easy with Alibaba.com. Go to http://www.alibaba.com now. Near the top of the page next to “Search,” you will see a pull-down menu that includes Buying Leads and Selling Leads. By the way, if you haven’t registered as a member you should do so now (it’s free). Click on Buying Leads and you’ll see 30 Product Categories. Select Agriculture. In today’s listing there is an entry entitled Buy Onion. ("Alibaba is constantly updating its buyers and sellers so by the time you read this, these directions may no longer show you a lead for Buy Onion, but I want to use this example to illustrate how easy it is to match buyers with sellers and profit from it!") This is a company that is interested in buying large quantities of size 5-7 red onions. The company is located in Malaysia. When you click on their listing you also learn they need the onions shipped in 10kg mesh bags. We’re making progress! Save this web page — and open a new window in your web browser (File -> New Window) and go to the Alibaba.com home page again. Click on Selling Leads this time. Search for “red onions” in the Selling Leads. In today’s listings there are several companies that are selling red onions. Let’s pick the company with a “TrustPass” certification. This will help us identify the most trust worthy company; one that is experienced at exporting. If we click on this Seller’s Listing we find out they sell red onions (sizes 5-7 are very common) and ship them in mesh bags. Further down in their listing we’ll see the Contact Information. Click on the Inquire Now button. We need to ask this seller to send us a quote for twenty 10kg mesh bags of number 5-7 red onions including shipping costs to Malaysia. Once we’ve obtained this quote we can contact the interested Buyer and give them the quote. But remember if you’re Matching Buyers and Sellers you will need to make a reasonable profit. When you send a quote to the Buyer our suggestion would be to add 15% to the quote. This 15% charge will be your profit. When the Buyer agrees to purchase the product (in this case red onions) they will send you from one third to one half of the purchase price. You will need to send this same amount to the Seller. After the product has been shipped by the Seller and received by the Buyer the remaining funds will be sent to you (typically by wire transfer). You will in turn send the remaining balance due to the Seller (less your 15% markup/profit margin). That’s it! Start Your Own Internet Import/Export Business

79

CHAPTER 18: ACTION PLAN: Fast Start Strategy — Completing Your First Deal In this case let’s say the quote that you received from the Seller was $75 for each 10kg mesh bag of red onions (this includes shipping to Malaysia). The Buyer has requested 100 bags, so 100 bags x $75 each = $7,500. But that’s not the quote you’ll send to the Buyer — when you send a quote to the Buyer you will need to include a 15% profit margin on the total order. To calculate your profit margin, multiply the Seller’s price x your percentage profit margin: $7,500 x 15% = $1,125 (your profit margin). The quote that you send to the Buyer will be $7,500 + $1,125 = $8,625. When this deal is completed you will have made $1,125. The only things that are involved with matching a Buyer and Seller on Alibaba.com, are sending a couple of emails (or making a couple of phone calls), overseeing the shipment, and collecting $1,125 for your efforts.

Importing Products for the Wholesale Market Importing products for the wholesale market is quite simple, too. We’ll need to identify which products have the greatest demand. In Chapter 10 we discussed ways of identifying some of the products that have a strong demand. But let’s use 100% cotton t-shirts for illustration purposes (there are actually thousands of products that could be used). How many stores, shops and retailers sell 100% cotton t-shirts in the U.S.? Canada? Australia? U.K.? Middle East? Africa? We think it’s safe to say that hundreds of thousands of stores sell 100% cotton t-shirts! Let’s identify and contact twelve stores to see if they would be open to receiving a price list from you for 100% cotton t-shirts. Most of the largest retail stores have already established relationships and/or own the factories overseas that produce 100% cotton t-shirts. So let’s focus on five medium-sized clothing retailers for this illustration. We provided a link to RetailNet http://www.retailnet.com let’s go there now. On the left hand side of the homepage you will see a category entitled Apparel — click it. We’re going to scour the headlines and/or databases to identify five medium-sized apparel retailers. The following five companies work fine for this example:

80


CHAPTER 18: ACTION PLAN: Fast Start Strategy — Completing Your First Deal Stein Mart Inc. 1200 Riverplace Boulevard Jacksonville, FL 32207 Phone: 904-346-1500 Fax: 904-398-4341 Web Site: http://www.steinmart.com Bebe Stores, Inc. 400 Valley Drive Brisbane, CA 94005 Phone: 415-715-3900 Fax: 415-715-3939 Web Site: http://www.bebe.com Finish Line Inc. 3308 North Mitthoeffer Road Indianapolis, IN 46235 Phone: 317-899-1022 Fax: 317-899-0237 Web Site: http://www.thefinishline.com Gymboree Corp. 500 Howard Street San Francisco, CA 94105 Phone: 415-278-7000 Fax: 650-579-1733 Web Site: http://www.gymboree.com Charlotte Russe Holding Inc. 4645 Morena Boulevard San Diego, CA 92117 Phone: 858-587-1500 Fax: 858-587-4902 Web Site: http://www.charlotte-russe.com

The next step is to identify the purchasing manager or apparel buyer at each of the five companies listed above. You can do this by going to their website, clicking About Us or Company Profile — and digging. If you can’t find a specific contact then just call or email the company for his or her contact information. Once you have obtained the appropriate buyer contact ask them if they would be open to receiving a wholesale price list from you. You can mention that you are an importer of 100% cotton t-shirts. If you are unsuccessful with these companies continue identifying and contacting other apparel retailers. You WILL find someone that is willing to look at your wholesale price list! What’s more, these five companies may be medium-sized retailers but they are still very large. Start Your Own Internet Import/Export Business

81

CHAPTER 18: ACTION PLAN: Fast Start Strategy — Completing Your First Deal You can contact much smaller retailers in local areas, too — try search on Google Local for an apparel retailer in a city of your choice! The next step is to locate a company that manufactures, sells and is able to export 100% cotton t-shirts. Again we go to Alibaba.com. Search for “cotton t-shirts” on the Alibaba.com main page. You will find hundreds of companies that manufacture, sell and are able to export 100% cotton t-shirts. Simply identify twelve of the most promising companies — click on their listing — and click on the Inquire Now button. Ask them to send you a quote for 5,000 100% cotton shirts in various sizes and colors. When the retailers that you have contacted respond in the affirmative and want to see a wholesale price list you can send them one. Important Note: When you are sending a wholesale price list to retailers it needs to look similar to the ones they receive from hundreds of wholesalers. When you inquire for a price quote from the exporting companies ask them to send you a wholesale price list for t-shirts. You will use this wholesale price list as a “template” to design your own (with your name at the top, etc.). In addition, you will need to include a 10-15% profit margin (or more) on the items. This is how you make moneyexporting products for retailers. Let’s see how the profit calculations work when importing products for the wholesale market. Finish Line Inc. agrees to purchase 15,000 100% cotton t-shirts from your company at $1.95 each plus shipping ($4,200) for a total of $33,450. This amount includes all taxes, fees and insurance. ABC Export Company in China agrees to export 15,000 100% cotton t-shirts to your client (Finish Line Inc.) for $1.25 each plus shipping ($4,200) for a total of $22,950. Your profit when this deal is completed would be $10,500! You can see why so many entrepreneurs get hooked on importing products for the wholesale market. What’s more, there are tens of thousands of items and products waiting to be imported and sold to the wholesale or retail market.

Exporting Products to Overseas Buyers Exporting products to overseas buyers is quite simple and can be a lot of fun, too. Thousands of companies in practically every country of the world need to import products because they lack the resources in their own country. For example, China is one of the largest importers of agriculture products in the world and the trend continues to rise! They have an insatiable demand for hundreds of different products including

82


CHAPTER 18: ACTION PLAN: Fast Start Strategy — Completing Your First Deal corn, wheat, soybeans, oats, vegetable oil, foodstuffs, coffee, tea, sugar, orange juice, rye, barley and many more. Granted, most of the billion dollar deals and shipments are handled by multi-national corporations like ADM, Cargill and Dupont. But there are still unlimited opportunities for small to medium-sized exporters. For example, on Alibaba.com on any given day you will find hundreds, and in some cases thousands of Buying Leads from people and companies that are looking to import products from the U.S., Canada, Mexico and the U.K., etc. For instance, this morning a Buyer from Portugal is looking for 4 metric tons of canola oil per month. You can search Alibaba.com to see if you can match this Buyer with a Seller (as we mentioned earlier). But another way to approach this is to find a company that produces canola oil and is able to export it to Portugal. You see there are thousands of companies that produce and manufacture and export products that are totally unaware of sites like Alibaba.com. Alibaba.com can be your secret resource. You simply identify companies that need products now (Buyers) and then locate companies that produce, manufacture and can export those products. It’s fun!

How to Find Companies that Produce, Manufacture and Export Products to Overseas Markets There are many ways to find this information, but the search engine Google is a pretty good place to start. Let’s find a company that produces, manufactures and is able to export canola oil to this Buyer in Portugal. Go to Google http://www.google.com Enter these words in the search box: we produce canola oil Our first search returned results on a company in Canada that produces and exports canola oil. There were hundreds of other search result pages but this one sounds the most promising. Upon further investigation we find that this company is willing and able to export canola oil to Portugal. Although they have never shipped canola oil specifically to Portugal – they have exported product to Europe, the Middle East, Africa and Asia. So this company appears to be a good fit. All you need to do is contact this company with your prospective buyers specifications and ask Start Your Own Internet Import/Export Business

83

CHAPTER 18: ACTION PLAN: Fast Start Strategy — Completing Your First Deal for a quote. Oftentimes the companies will want to talk to you by phone — and remember you have an international exporting company. As we’ve said, deals like this are plentiful!

Importing Products for Resale on the Internet This is perhaps the most exciting aspect of an import/export business because of the profit potential. But it’s also a quick and easy way to get into this business! The objective is to import products as inexpensively as possible and resell them on the Internet with an online store. The trick is to identifying the hottest markets and trends so you don’t have to carry a large inventory. For example, let’s import sunglasses as inexpensively as possible and sell them on the Internet. What’s more, we need to get a website up and running, and be able to accept credit cards as quickly as possible. One of the best ways to do this is with “instant storefronts” like the ones we suggested in Chapter 9. For this illustration let’s use an eBay storefront and/or auction because it receives monster targeted traffic, and you can set up a store in just a few minutes. In time you might want to secure your own domain names and implement your own ecommerce applications (like those we mentioned) so as to maximize profits! You can open an eBay Store in about 20 minutes and the pricing starts at about $15.95 month: http://pages.ebay.com/storefronts/seller-landing.html It is highly recommended that you spend a few minutes reading the tutorials because you’ll learn everything you need to know about eBay Stores, policies, procedures and best of all — additional marketing and promotion ideas. Okay — we’ve opened our storefront and we’re going to focus on sunglasses because it’s a fairly hot item and because we can import them inexpensively (as you will see). The next step is to locate a company that can export sunglasses as inexpensively as possible. We go to Alibaba.com once again to find sunglasses manufacturers. Important note: There may be companies in your country that manufacture products like this but generally speaking the least expensive products are typically found in Asia, India, Pakistan, South America and Mexico). Enter “sunglasses” in the search box at the top of the page (in the Selling Leads category). You will find more than 712 Selling Leads in this category! Let’s choose the first company (they are also a TrustPass Member which enhances the credibility). Upon further investigation we find that this company is located in China (no surprise there) and is extremely competent when it comes to exporting their products anywhere in the world. We also learn they ship most of the product line in cases of 300. 84


CHAPTER 18: ACTION PLAN: Fast Start Strategy — Completing Your First Deal Most of the time you will find that exporting companies have minimum order requirements. That’s okay — because when you are first starting out in your import/export business you will only be placing minimum orders — because you don’t want to maintain large inventories. The cost for a minimum order of 300 assorted sunglasses is approximately $285 (or $.95 each) plus shipping of $75. The total cost for this order is $360. Here’s the exciting part! Let’s go back to the eBay main page and search for sunglasses. The prices and styles vary a great deal but sunglasses sell for $6.95 to $150 each. We’ll need to test different price points to see at which level we can move the greatest number. But even if we sell them at the lowest price point of $6.95 each we’ll make a significant profit. If the total sunglasses order from China is $360, that means that we’re paying about $1.20 each ($360 divided by 300 = $1.20). In this scenario we generated a profit of more than 550%!!! Sunglasses are only the tip of the iceberg! There are literally thousands of products in hundreds of categories that you can import very inexpensively and resell them on the Internet for mind-boggling profits! NOW is the time to make it happen. Take action today. Discover the hottest products on the Internet — import them as inexpensively as possible and resell them for big profits. What’s more, we only used eBay in this example! There are dozens of high traffic sites, marketplaces, online classifieds and storefronts that you can utilize to sell imported products for major profits!


85

CHAPTER 19: Growing Your Business for Even Bigger Profits

CHAPTER 19

Growing Your Business for Even Bigger Profits This chapter is devoted to growing your import/export business as well as your profits. The following information is why most entrepreneurs love this business – monster profits! Let’s take a look at a few of the most successful importer/exporters the world has ever known. Granted, many of these entrepreneurs did not have the luxury of high tech communications, satellite, high-speed Internet, supersonic transportation or sophisticated logistic systems and applications. That is why an import/export business is tailor made for today’s Internet entrepreneur!

Renowned Importers and Exporters

86



George Gray of Tunbridge Wells, U.K. was a successful entrepreneur who made a fortune from importing fruit and producing confectionery



In the 1880s the dime-store magnate F. W. Woolworth discovered Lauscha’s Glaskugeln ornaments during a visit to Germany. He made a fortune importing the German glass ornaments to America



Julius Robert Oppenheimer was the son of a German immigrant and made his fortune by importing textiles in New York City



George Smith, a Victorian publisher, made a fortune from importing mineral water



Joseph P. Kennedy and family made a fortune by importing Scotch



Sidney Frank of New Rochelle, NY has made a fortune importing the world’s most expensive vodka’s GreyGoose and Jaegermeister. He enjoyed more than $115 million in profits in 2004



Shakar Pentaka an Indian businessman, has made a fortune by importing and selling blankets in Africa



Automotive entrepreneur Malcolm Bricklin is on a mission to be the first mass importer of low cost Chinese cars. Bricklin has had a long illustrious career of importing automobiles. He started by importing Subarus in 1968 and later founded Yugo America Inc.which imported Yugo cars from the former Yugoslavia



Rajit Argawal, a very rich businessman in Karachi, India, made a large fortune by importing needles in the early 1900’s



Aristotle Onassis made his first fortune by importing tobacco and then bought a whaling fleet followed by surplus ships from the United States at the end of World War II


CHAPTER 19: Growing Your Business for Even Bigger Profits 

In the 13th Century, The Saylors of Dieppe, Viking descendants, made their fortune by importing precious wood.



Mayer Amschel Rothschild (of The House of Rothschild fame) amassed a sizable fortune by importing wine and manufactured materials from England



William Gibbs made his fortune from importing guano from Peru for use as fertilizer



Australian entrepreneur Dick Smith made his fortune by importing electronics from Asia



Three Scots, all brothers — Patrick, James and Daniel McMasters amassed a small fortune by importing British goods into the U.S.



Semon Bache made his money importing plate and window glass into the United States in the early 1900’s



William H. Gebhard made a fortune importing fine wines and liquors for a rich clientele that could afford the best



Stephen R. Lesher parlayed something as humble as imported tailors’ trimmings into a fortune



Leonard Lewisohn built a multimillion dollar fortune by importing hair, bristles, ostrich and other feathers



In the 19th century, Mark Dunham made his fortune in Wayne by importing Percheron draft horses from France



Alfred Kohlberg, a wealthy textile owner made his fortune importing Irish linen and then embroidered it very inexpensively in China



Humphrey Monmouth lived was a wealthy merchant in the 1600’s who made a fortune importing and remanufacturing cloth



Boro Vukadinovic, a multi-millionaire textile tycoon, made his fortune in America by importing Italian and Eastern European goods



Matsuhisha Kojima, a motocross champion in Japan, made his fortune importing bananas



W.W. Crenshaw made a fortune importing four million banana stems to the Golden State



Hundreds of Russians made small fortunes importing personal computers in 1990s



American millionaire Elias Haskett Derby made his money importing black pepper. He used his fortune to endow Yale University



Royal Dutch/Shell Group co-founder Marcus Samuel made his earliest fortune importing knick-knacks made from exotic sea shells from the far east



Vyasheslav Bresht made his first fortune importing luxury cars from Germany



Michael Weatherly Sr., made a fortune importing the first Swiss Army Knives in to the U.S.



Morgan Hughes, 86, a native Irishman, made his fortune importing amusement park rides from Europe after World War II



Manuel Rionda made his fortune importing sugar from South America



Trev Deely generated a multimillion dollar empire by importing motorcycles and selling them in Canada



Sandy Chadha is a multi-millionaire, and the U.K.’s largest importer and distributor of batteries


87

CHAPTER 19: Growing Your Business for Even Bigger Profits

Successful Internet Importers & Exporters 

Shenzhen Technology Rise Microelectronic Co., Ltd. is a privately owned company that manufactures and exports micro-controllers, voice chips and electronic gifts. The company is located in Baoan District of Shenzhen



T. T. Flora Co. in Thailand manufacturers and exports artificial flowers, craft flowers and bridal flowers and accessories



Shandong Jumboaudio Research Co., Ltd. manufacturers and exports car speakers, woofers, boom boxes, PA systems, wall speakers, and other car audio equipment



Joyful Path in Hong Kong manufactures and exports handbags, cosmetic bags, document bags and backpacks



Aristey Fashion in the U.S. is an international exporter and distributor of designer women’s apparel



Paranthaman Exporters (India) specializes in drilling rigs for water wells, mining, exploration and pole drilling. They also manufacture and export hammer bits, rock roller bits and drilling rods



Hong Mei Coral Jewelry Factory, based in Taiwan, was founded in 1987; they manufacture and export coral beads and cabochons, supplying both local and foreign markets



Bernard Cosmetics manufactures, exports and sells products in the USA, England, Germany, UAE and Korea



Zhejiang Wanshengda Industry Co., Ltd. in Mainland China exports playing cards and notebooks



Mahanem LLC (U.S.) exports computer and consumer electronics. Their line of products includes: Apple iPod, CPU, digital cameras, camcorders, projectors, monitors, motherboards, MP3 players and more



Shenzhen Jinhuicong Science & Technology Co., Ltd. is one of the largest manufacturers and exporters of security alarm systems, wireless cameras, fire alarms, radar detectors, and related products



Lingying Vehicle Co., exports gas scooters, electric scooters and pocket bikes to markets around the world



Xiamen Caixin Inflatable Product Co., Ltd. in the Fujian Province, China, manufactures and exports inflatable products like bouncers, castles, slides, air tents, air dancers, tunnels, mascots, arches, pools and balloons



President Furniture in Indonesia builds and exports high quality teak furniture, teak outdoor furniture, teak garden furniture, indoor furniture, steamer, chair, table, bench and patio furniture



Shandong Yijian Pharmaceutical Co., Ltd. (China) is a major importer of Citicoline Sodium



Liu’an City Guzhen Feather Craftwork Factory is one of the largest importers of turkey feathers in the world

All of these entrepreneurs saw a need and filled it by importing products and reselling them, or exporting products to other countries.

88


CHAPTER 19: Growing Your Business for Even Bigger Profits On top of that, most of them tended to focus on a particular product or market. They typically did not diversify into multiple product lines. These entrepreneurs parlayed their wealth and success by applying time-tested principles over and over, and subsequently their businesses grew exponentially at every stage. You can do the same things in your import/export business!


89

CHAPTER 20: Importing and Exporting Billionaires

CHAPTER 20

Importing and Exporting Billionaires The world’s billionaire importers and exporters do not approach business the same way as millionaires do. In fact, they play at an entirely different level, which includes relationships with government officials, multinational corporations and “sweetheart” deals. Even if you don’t have a desire to build your import/export business to this size or depth, there are still lessons to be learned by watching billionaires play the game. There are ten specific things that billionaire importers and exporters do in order to generate mind-boggling profits. According to Forbes magazine the collective net worth of the world’s 691 billionaires (in 2005) is $2.2 trillion, up $300 billion from the combined net worth of the 587 people listed in 2004. Of that number more than half of these billionaires are involved in importing and exporting products at some level!

Billionaire’s Rule Book: 1) Set Goals (be specific and include dates) 2) Steward Your Health and Wellness 3) Love, Honor and Cherish Your Family 4) Own Markets 5) Identify Formulas (sales, marketing, investing, etc.) — Apply them repeatedly and do not alter them 6) Understand Your Core Market — Don’t Dabble in Other Markets Until You Understand Them as Well or Better 7) Generously Reward Results — Penalize Incompetence (swiftly) 8) Diversify Holdings (low risk / medium returns or higher) 9) Aggressively Protect Wealth 10) Charity — Passionately Share Wealth There are probably more rules but these were complied by researching the world’s foremost billionaires.

90


CHAPTER 20: Importing and Exporting Billionaires

Billionaire Importers/Exporters Rem Vyakhirev - Russia Natural gas and heavy equipment $1.5 billion net worth Max H. Schachenmann Marble, Agriculture, Concrete $1 billion James Moran Automobiles $1.4 billion Michael Ying Apparel $1.8 billion Roustam Tariko Vodka, Automobiles, Luxury items $3 billion Nadim Khoury Beer $1 billion Solomon Lew Consumer goods $1.5 billion Thomas J. Mazzetta Frozen Seafood Unknown Lev Leviev Diamonds $2 billion Li Ka-Shing Electronics, Tourists, Consumer Goods, Mobile phones $5 billion Sidney Frank Fancy vodka and tequila $2 billion Alex Shnaider Steel $2 billion


91

CHAPTER 20: Importing and Exporting Billionaires Dhirubhai Ambani Polyester and spices $1 billion Carlos Slim Oil, industrial equipment $5 billion Vijay Mallya Liquor $2 billion Terry Peabody Fly ash – trucks $2 billion Gautam S Adani Natural resources $1 billion Olav Thon Tabacco $1.5 billion

All of these billionaire importers and exporters started with an idea. They were convinced they could make money in this business! You need to be convinced you can make money in this business, too — and one of the best ways to do that is by taking action. The conditions are no different today than they were when these entrepreneurs started their import/export businesses. They all started from somewhere. But the key is they started — these billionaires took some kind of action toward their goal or objective. In the next chapter we’ll show you the importance of focusing on one product or market when you’re first starting this business. This will keep you from getting sidetracked and it will help to make your business incredibly simple — and fun!

92


CHAPTER 21: Focus on One Product at a Time

CHAPTER 21

Focus on One Product at a Time One of the fastest ways to get started and be successful in your import/export business is to focus on one product or product line at a time. You may be tempted to jump from product to product… but don’t give in to temptation. The reason it’s important to focus on one product or line at a time is because it helps you to become more knowledgeable and proficient than your competitors. This proficiency should lead to greater profits because you will KNOW and UNDERSTAND your market better than anyone. To repeat: Our recommendation is to keep it simple when you start out and focus on one product or product line at a time. After you’re successful in one area, you can expand into additional products and lines. This is the key strategy that most successful Internet import/export businesses and entrepreneurs follow. For example, there is a company in Hong Kong called Jiaxing Maosen Flag Co., Ltd. The company imports and exports flags. That is the only product they carry. They have thousands of flags of every shape, color, design, language and purpose. Another example is Rose Best LLC — they specialize in handmade soaps. The company carries hundreds of different sizes, shapes, colors and scents. They ship worldwide. Thai Mountain Imports focuses on bamboo and wicker furniture. They export their products around the world. It will be easy to avoid the temptation to “jump around” from product to product when your first few deals are successful. You’ll see the value and benefit of focusing on products you really enjoy, or products where there is a tremendous demand. If a particular product or product line is not moving — you can easily shift into new products! That is one of the greatest advantages of an import/export business. You can move into a new product line at a moment’s notice, and that’s especially true if you’re not entangled in large inventories. The following is a list of companies and the products they have focused on: Yuyao Jinwei Sprayers Avasin Computers Start Your Own Internet Import/Export Business

93

CHAPTER 21: Focus on One Product at a Time Galleon Trade Pan Pacific Ventures Corp. Scrap metal Shaul Barnea Ltd Computer memory China Guangzhou eFiver Electronics Co., Ltd Batteries Seasons & Fashions Garments Cybercraze Computer accessories Fujian Xiamen Yongqing Trade Co., Ltd Poly resin Kaki Zawa Enterprise Co., Ltd. Brown sugar Frontier Enterprises Heavy equipment J D Overseas Handicrafts Sun Nonwoven & Paper Non woven products (like baby wipes) Sita Sourcing Solid wood furniture Raf Unique Ventures Office supplies Dimensionx Inc. Mobile phones Ghozat Poultry Units Co. Poultry products Sportsmoto Watches KCF Trades & Exports Chemicals Herbalbd Herbs Susheela Fertilizers & Pesticides Fertilizers and Pesticides

94


CHAPTER 21: Focus on One Product at a Time Stileks Steel billets Yu-va Gida Temizlik Turizm Insaat Cable Asrar Supply Services Food additives J. L Trade Co. Ltd Home appliances Jubin Part Chemico Inorganic chemicals Transaria Audi parts Dejen Enterprise Agriculture products K2B Agency Contact lenses Tuzgolu Otomotiv Ltd. Lamps and bulbs Sinoz Company Ceramics Azadsystemnet Iranian carpets and rugs Aman Trading Co Nuts Hua Bags Handbags / accessories Concept International Inc. Jewelry Zhejiang Shuangling Socks Co, Ltd. Socks 2kmg Corp. Yarn PT. Astura Fruit juice Bella Bisque Inc. Italian pottery Start Your Own Internet Import/Export Business

95

CHAPTER 21: Focus on One Product at a Time Sangho Ceramic Co.,Ltd. Ceramic products Zibo OceanFar General Merchandise Co., Ltd. Glassware Shikha International Bottles of every color and type Tianjin Tianrui Animal By-Products Co., Ltd. Animal by-products, wool, cashmere Marble Unique Inc. Marble statues Shenzhen Shinefull Shell Industrial & Trading Co., Ltd. Sea shells from around the world Herbgate Co., Ltd Eels Kabir Sports Gloves for work, sports and welding GPS Trading Lingerie Dollmac Trading Co. Baby clothes and accessories Chumsangthai Goldrice Ltd Thai rice Kenrico Ltd. Detox pads Power Drinks SL Energy drinks Rommel EMC Refurbished notebooks AGRICOLA GUARANI SRL Forestry products Ivand Trading Co. Dried fruits GM Gateway Co. Electronics CWL Import Food and confections 96


CHAPTER 21: Focus on One Product at a Time Jinoo Corp. Fabrics DCF Enterprises Clothes / jeans Viet Tra Co. Ltd Handbags/scarves Prowell Company Metals

These companies focus on one product or product line — and they are very successful. If you adapted a similar strategy and focused on one product it would not only simplify your business… it would help establish you as an expert in that area. In the next chapter we’ll include valuable trade resources to help you build your business, contacts and expertise.


97

CHAPTER 22: Trade Resources

CHAPTER 22

Trade Resources In this section we are providing more than 100 trade resources to help you establish contacts, further your education and build your import/export business. These trade resources will also help you to find products, buyers, sellers, ecommerce, online stores, web hosting and trade organizations. We’re confident you’ll come back to this section again and again to find the information you need to be successful. Federation of International Trade Associations http://www.fita.org Boletin.net (directory of importers/exporters/manufacturers) http://www.boletin.net BuySellOffers (directories of importers/exporters) http://www.buyselloffers.com ChinaBig Global (Directory of 1 million businesses worldwide) http://gtdchina.yp.com.hk Export Focus (directory of resources) http://www.exportfocus.com Global Importers Directory http://www.export-import-companies.com Importer List http://www.importerlist.com Online International Business Information Directory http://www.b2b-bestof.com TOBOC – International Trade Leads http://www.toboc.com Foreign Trade Online (massive import/export resource) http://www.foreign-trade.com TradeKey http://www.tradekey.com

98


CHAPTER 22: Trade Resources Asian Product Directory http://www.asianproducts.com Trade India (product directory) http://www.trade-india.com New York International Gift Fair http://www.nyigf.com San Francisco International Gift Fair http://www.sfigf.com Toronto International Gift Fair http://www.torontointernationalgiftfair.com World Trade Show Directory http://www.worldtradeshow.com Hong Kong Electronic Fair http://hkelectronicsfair.com Jinhan Fair for Textiles, Garments and Fabrics http://www.jinhanfair.com Canton Fair http://www.cantonfair.org.cn Productronica http://www.productronica.de Shenzhen International Toys and Gifts Fair http://www.szsinoexpo.com Export911 (Trade education and resources) http://www.export911.com GoEastDirect http://www.goeastdirect.com

International Universal Currency Converter http://www.xe.com

International Business and Personal Credit Checks Experian http://www.experian.com Equifax http://www.equifax.com TransUnion http://www.transunion.com Start Your Own Internet Import/Export Business

99

CHAPTER 22: Trade Resources

BBBOnline http://www.bbbonline.org

Top Auction Sites – (For Selling Imported/Exported Goods Online) eBay http://www.ebay.com uBid http://www.ubid.com Bidz.com http://www.bidz.com Overstock.com http://auctions.overstock.com Bidstar http://www.bidstar.net Auction.com http://www.auction.com Yahoo! Auctions http://auctions.yahoo.com MSN Shopping http://shopping.msn.com Froogle Shopping http://www.froogle.com Amazon.com Auctions http://www.amazon.com Half.com http://www.half.com Sotheby’s http://search.sothebys.com Christie’s http://www.christies.com Biddington’s http://www.biddingtons.com

100


CHAPTER 22: Trade Resources Liquidation.com http://www.liquidation.com Taobao (China’s largest auction site) http://www.taabao.com eBay China (American products are very hot) http://www.ebay.com.cn Daily Bidz http://www.dailybidz.co.uk

Free Web Hosting DotEasy http://www.doteasy.com Be-Hosted http://www.be-hosted.com Blogger.com http://www.blogger.com Yahoo! Geo Cities http://geocities.yahoo.com 50Megs http://www.50megs.com Free Web Hosts http://www.free-webhosts.com FreeWebs http://members.freewebs.com The Free Site http://www.thefreesite.com The Homestead http://www.homestead.com Bravenet http://www.bravenet.com Web Spawner http://www.webspawner.com

eCommerce Web Hosting HostMySite http://www.hostmysite.com Start Your Own Internet Import/Export Business

101

CHAPTER 22: Trade Resources ValueWeb http://www.valueweb.com SuperbHosting http://www.superbhosting.com Apollo Hosting http://www.apollohosting.com BlueHost http://www.bluehost.com Globat.com http://www.globat.com

Shared Web Hosting Velcom.com http://www.velcom.com APlus.net http://www.aplus.net Exists Hosting http://www.existhosting.com Host Gator http://www.hostgator.com Ready Hosting http://www.readyhosting.com StartLogic http://www.startlogic.com

eCommerce Shopping Carts (for online stores) Fortune 3 http://www.fortune3.com Mighty Merchant http://www.mightymerchant.com Actinic eCommerce Software http://www.actinic.co.uk Bazaar Builder http://www.bazaarbuilder.com CubeCart http://www.cubecart.com 102


CHAPTER 22: Trade Resources WirePlanet http://www.wireplanet.com Lite Commerce http://www.litecommerce.com Smart Shop http://www.smart-shop.com Charge.com http://www.charge.com Just Add Commerce http://www.richmediatech.com Product Cart by Early Impact http://www.earlyimpact.com eCom Pal http://www.ecompal.com Mal’s eCom (great for static websites) http://mals-e.com Americart http://www.cartserver.com/americart PrestoStore http://www.prestostore.com Plexxa http://www.plexxa.com ePay http://www.epay.com

Important note: Not all shopping carts and online stores are created equal. One of the best forums on the Internet can be found on Webmaster World http://www.webmasterworld.com Contributors include the people that develop, program and use ecommerce applications and storefronts on a daily basis.

Alibaba.com Resources Channel Alibaba.com Discussion Lists and Forums http://resources.alibaba.com/discussion_board/11/General_Trade_Discussions.htm Alibaba.com Tutorials http://resources.alibaba.com/discussion_board/22/Tutorials.htm Start Your Own Internet Import/Export Business

103

CHAPTER 22: Trade Resources Alibaba.com Shipping Tutorials http://resources.alibaba.com/trade_essential/a101/Shipment_Delivery.htm Alibaba.com Financing Tutorials http://resources.alibaba.com/topic/forumList.htm?forum=4 Alibaba.com Online Security Tutorials http://resources.alibaba.com/trade_essential/10/online_security.htm

U.S. Government Resources FirstGov http://www.firstgov.gov FedStats http://www.fedstats.gov/toolkit.html IRS http://www.irs.gov U.S. Department of Commerce http://www.commerce.gov International Trade Administration http://www.ita.doc.gov Federal Citizen Information Center http://www.pueblo.gsa.gov United States Customs Service http://www.customs.gov/ CIA World Factbook http://www.cia.gov

In the next chapter we have assembled a comprehensive resource of standard forms, contracts and agreements. In addition, you will find shipment inspection forms, letter of credit information and the basics of extending credit to buyers. We have also provided information for obtaining financing from import/export banks to further your business expansion. We’re confident you will find this section extremely beneficial to your import/export business.

104


CHAPTER 23: Standard Forms, Contracts and Agreements

CHAPTER 23

Standard Forms, Contracts and Agreements This section can be a little overwhelming. But keep in mind that not all of these forms, contracts and agreements are necessary in every situation. This information is simply provided as ancillary information in case you should need it at some point in your import/export business. In most cases you can begin doing business on the Internet immediately. All of these forms, contracts and agreements will not be required. But if they are required or needed you will have the information here at your fingertips.

Shipment Inspections Governments or buyers demand inspection reports for a number of reasons: 

To ensure shipments do not contain illegal or low-quality merchandise



To make sure importers are properly declaring their goods



To ensure they have received what they have paid for or are about to pay for (usually by independent inspection) The process typically starts with the buyer. Once a contract between a buyer and seller has been established, the importer or buyer will arrange with their favorite inspection company a pre-shipment inspection. Although some countries require a specific company to perform the inspection, others have opened it up to a variety of competitors. Upon requesting an inspection, the following information needs to be given to the inspecting company:



Company name and contact name of the exporter and the type and location of the goods to be inspected. Note: Regarding the time of the inspection, inspectors have busy schedules and need a five to seven day window to schedule a visit. Once you have a tentative date for inspection you need to have the goods ready for inspection. This may mean opening the shipping unit or having the container staged and ready to load.



Many “Less than Container Load (LCL)” shipments can be inspected at the port of export



It is recommended that the inspection take place where you can supervise and answer questions the inspector might have



You may also need to close up a crate or box following the inspection so it is best that you are or your forwarder is available to assist during the examination


105

CHAPTER 23: Standard Forms, Contracts and Agreements 

Following the inspection, a “Clean Report of Findings” (or something similar) will be issued. This is usually required at the time of import. Most reports are issued following proof of export and usually can be completed by fax

The importer usually pays the costs for such examinations; however, delays can be invoiced directly to the exporter. The inspector will look at the following aspects of the products in the shipment: 

Safety Are the products compliant with applicable safety regulations?



Performance Does the product function properly, and as intended?



Appearance What is the condition of the finish, printing and marking?



Packaging Is the condition of packing, marking and accessories appropriate?

Sample inspection form:

106



Quality control and compliance When purchasing volume goods internationally, there are many areas in the process where you should conduct checks on your prospective suppliers. 

The first one is during the discovery and negotiation process when you are deciding which supplier to go with. More often than not, the prospective supplier will indicate whether he or she has achieved ISO accreditation for their products. See below for details:



The other very important stage in quality checking is prior to shipment. You need to engage the services of an inspection officer to go through the shipment to check and see if what you are about to receive is what you paid for.

International Organization for Standardization (ISO) ISO (International Organization for Standardization) is the world’s largest developer of standards. ISO has built a strategic partnership with the WTO (World Trade Organization), with the common goal of promoting a free and fair global trading system. Between 1947 and the present day, ISO has published more than 15,000 International Standards. Although ISO’s principal activity is the development of technical standards, ISO standards also have important economic and social repercussions. ISO standards make a positive difference, not just to engineers and manufacturers for whom they solve basic problems in production and distribution, but to society as a whole. 

ISO:9000 is concerned with “quality management.” This means what an organization does to enhance customer satisfaction by meeting customer and applicable regulatory requirements and continually to improve its performance in this regard.



ISO:14000 is primarily concerned with “environmental management.” This means what an organization does to minimize harmful effects on the environment caused by its activities, and to continually improve its environmental performance.


107


Documents against Payment (D/P) flow diagram Documents against Payment/Bill of Exchange flow diagram (Courtesy of Wiley Publishing)

108



Letter of Credit (L/C) transactional flow diagram Letter of Credit Flow diagram: (Courtesy of Wiley Publishing)


109


When buyers don’t pay: reduce your non-collection risk In international trade, there are differing reasons why you may experience a buyer defaulting on payment. A buyer may have a legitimate complaint regarding an incorrect shipment. There may be a problem with the banks facilitating payment. Or a buyer may simply have decided not to pay for their goods. Regardless of the reason(s), there are some things you, as a supplier, can do to reduce this risk: 

It is a general rule that before international trade is conducted, both parties should always engage in some *formal and informal “checks” of the other party (see below).



It is always wise to have insurance against payment defaults, but be aware that you must exhaust all reasonable means of collecting payment before an insurance claim will be honored.



It also considered wise to select or suggest payment options, which reduce your exposure to financial loss, especially if you are dealing with a buyer for the first time. From the wide range of payment options available, the most popular among suppliers is Telegraphic Transfer (T/T) payment in advance, which means the payment is sent to you before you order shipment of products.

Another option is to select a payment process, which works both in favor of the buyer and seller. Letters of credit distribute risk evenly.

Formal and Informal Checks Common sense approaches to finding genuine buyers A long-held concern for many suppliers both experienced and new is that inquiring buyers might be showing interest only for price comparison purposes. Alibaba.com’s sellers’ advice for dealing with buyers is summarized below: 1. Pay more attention to those emails, which are highly specific, as this can be an indicator of authenticity. 2. Distinguish authentic buyers via communication (chat, phone, fax, email) by asking questions regarding: 

Product specifications



Technical requirements



Acceptable pricing



Required quantity



Brand history



The number and type of companies with which they have cooperated with in the past



How long they have been in business

3. Business cards from buyers provide information, including: a. Where their company is located in their city 110


CHAPTER 23: Standard Forms, Contracts and Agreements b. How many telephone lines they have c. Whether they have their own website or whether they do e-commerce through free services d. Whether they are retailers, wholesalers, importers or agents, or any combination 4. Give careful attention to product inquiries outside of your usual product categories. One reason is that the buyer typically cannot find a supplier who can match his requirements. This is a good opportunity for you. On the other hand, even if you do not get an order, you can gauge market demand and technical standards for new products. This information is normally very hard to get.

Popular payment methods in international trading Popular payment methods There are many ways to make and receive payment in international trade. Due to the physical distances between buyer and seller, and the fact that the transaction may have taken place without the two parties actually meeting, minimizing exposure to risk is on the minds of both parties. The buyer wants to make sure they receive their order in acceptable condition and on time, and the seller needs to know they will get paid for it.

Payment TT or Cash Advance

Details

Allocation of Risk

T/T is the easiest payment form and is typically used when samples or small quantity shipments are transported by air. T/T is also used between buyers and sellers who have already established a mutual trust, as this negates the risks associated with this, the fastest and cheapest form of payment. Documents like air waybills, commercial invoices and packing lists will be sent to you along with the shipment in the same aircraft.

100% buyer risk

As soon as the shipment arrives, you, with documentation, can clear the customs and pick up the goods. Shipping happens only after the money is safely in seller’s bank account. It usually takes 3-4 days for such a wire transfer anywhere in the world.


111


Allocation of Risk

Payment

Details

Letter of Credit (L/C)

The L/C is a guarantee, given by the buyer’s bank that they will pay for the goods exported, provided that the exporter can provide a given set of documents in accordance with clauses specified in the L/C and in a timely manner. The technical term for letter of credit is “Documentary Credit.” Letters of credit deal in documents, not goods. Thus, the process works both in favor of both the buyer and the seller. Simply put, a letter of credit is a letter written by the importer’s bank to the exporter. It verifies that the payment will be guaranteed when the bank is presented with concrete documents (bills of lading and freight documents).

Evenly shared

Most letters of credit are “irrevocable” once the importer has had them sent, which means it cannot be changed unless both the buyer and seller agree.

Escrow

Escrow is a legal arrangement (and most commonly a payment arrangement) whereby money is delivered to a third party (called an escrow agent) to be held in trust (“in escrow”) pending the fulfillment of condition(s) in a contract, whereupon the escrow agent will deliver the payment to the proper recipient. Typically, escrow is used when the Buyer and Seller are unknown to each other. In an international trade context, after the Buyer and Seller have agreed to the transaction, the buyer puts the payment in escrow by paying the escrow agent, which both parties have agreed to use. The seller sends the shipment and upon acceptance by the buyer, the escrow agent releases the payment to the seller.

Document Against Payment/Bill of Exchange

(D/P) The exporter ships the goods, and then gives the documents (including the bill of lading necessary to claim the goods at the foreign port) to his bank, which will forward them to a bank in the buyer’s country, along with instructions on how to collect the money from the buyer.

Evenly shared

Mainly with supplier

When the foreign bank receives the documents, they will contact the buyer and provide documents to the buyer only when the buyer pays.

Open Account

112

Opposite situation to T/T: The exporter receives payment only after the buyer has received and inspected the goods.

100% seller risk



Approaching the lender and understanding lender practices How they rate you Obviously, the lender will do comprehensive checks on your business and products. It is advisable to have a detailed export plan ready and be able to clearly show how and when a loan will be repaid. The typical information required might include some or all of the following: 

Year end financial statements for the last three years on the business and copies of signed tax returns



Current interim financials, normally not older than 90 days



Personal financial statements on all owners with 20% or more of the company’s shares and copies of each of their last three years’ individual tax returns



Product literature/business plan or narrative on how the business is operated, number of products produced and sold to indicate proof of ability to perform



Resumes on key management



Financial projections (P&L) and a cash flow statement



Proof that 50% of content in the product(s) originates in the country of export



Purchase order copies from foreign buyers



Information on foreign buyers and their ability to pay

What you can do Likewise, you should hunt around for the best loan, as well as the institution which understands what you want to achieve through export. Ask the following questions: 

What are the charges for confirming export documentation (letters of credit, processing drafts, and collecting payments)?



Does the bank have foreign branches or affiliate banks? If so, where are they located?



Can the bank provide buyer credit reports? At what cost?



Does the bank have experience with your federal and state government financing programs that support small business export transactions? If not, is it willing to consider participating in these programs?



What other services can the bank provide?

The basics of extending credit to buyers Frequently, buyers ask for extended credit terms and/or financing to purchase your goods, but few exporters can manage the cash flow issues or commercial risks without assistance caused by these types of contracts. This called “term financing.” Buyer credit programs typically provide loan guarantees to commercial lenders. This kind of program benefits all the parties involved: 

Exporter benefits: paid cash on delivery and acceptance of the product or service


113

CHAPTER 23: Standard Forms, Contracts and Agreements 

Buyer benefits: extended credit terms



Lender benefits: guarantees, many backed by the government, for full repayment of the loan

A general overview of the nature of loans 

Trade finance generally refers to financing individual, self-liquidating transactions. Selfliquidating means the bank collects payment for the transaction it has helped to finance. This is used to redeem the money lent to the exporter. The remainder is credited to the exporter’s account.



Pre-shipment financing is granted to the exporter to enable him to cover costs of manufacturing or shipment.



Working capital loans, which are associated with pre-shipment financing, are designed to cover more long-term operating costs related to a sales order or contract, specifically in the areas of labor, materials and inventory.



Lenders also engage in Post-shipment financing where a bank or government agency extends a cash advance to the exporter against the security of billing instruments representing the goods shipped, pending payment by the importer.



It is recommended that promotion financing, such as that needed to attend trade shows, come from the working capital of the firm.

For sellers: obtaining export financing Export financing Trade finance is a specific topic within the financial services industry. It refers both to loans sought by exporters (pre- or post- shipment) as well as to the extension of credit to importers, which enables them to purchase from exporters. Exporters can obtain financing from either commercial banks or governmental agencies looking to encourage SME (small to medium enterprise) export: 

Large multi-national banks are generally thought to be the most experienced in trade finance, but these banks are less interested in working with small businesses because of the smaller deal sizes and volumes accompanied by greater risk. Even SMEs with large trade deals are not attractive to larger banks due to risk and credit issues.



Federal and local government agencies offer programs to assist exporters with their financing needs, which include the provision of loans or grants, as well as improving an exporter’s access to credit. Government guarantee and insurance programs are used by commercial banks to reduce the risk associated with loans to exporters.

Resolving payment problems with buyers If a payment problem occurs, you will want to resolve the issue as quickly as possible with the buyer. You first need to get a good understanding of the entire situation before seeking dispute resolution assistance. Ask:

114



Were the goods supplied per the contract/invoice? Are all your shipping and customs documents in order? Was there damage or theft?



Have you attempted to negotiate a solution to the problem, along with a payment plan or


CHAPTER 23: Standard Forms, Contracts and Agreements future concessions to the buyer? Have you discussed your problem with your bank and your lawyer? Do you have copies of all correspondence and records related to the dispute? 

Help with payment disputes

If you have come to the point where negotiations with the buyer are not leading to a resolution and you are determined to collect, you will have to turn to the advice of your bank, legal adviser and perhaps other advisory bodies involved in mediation, arbitration or even litigation. The International Chamber of Commerce handles the majority of international arbitration and is usually acceptable to foreign companies because it is not affiliated with any single country.


115


116




117


118




119

TERMINOLOGY: A Glossary and Definition of Import/Export Acronyms

TERMINOLOGY

A Glossary and Definition of Import/Export Acronyms TERM -ACRONYM

DEFINITION

ABI

Automated Broker Interface - a part of Customs Automated Commercial System, permits transmission of data pertaining to merchandise being imported into the U.S. Qualified participants include brokers, importers, carriers, port authorities and independent data processing companies referred to as service centers.

ACE

Automated Commercial Environment - Part of Customs Automated Commercial System which controls imported merchandise from the time a carrier’s cargo manifest is electronically transmitted to Customs until control is provided to another segment of the ACS.

ACH

Automated Clearinghouse - The Automated Clearinghouse (ACH) is a feature of the Automated Broker Interface that is a part of Customs Automated Commercial System. The ACH combines elements of bank lock box arrangements with electronic funds transfer services to replace cash or check for payment of estimated duties, taxes and fees on imported merchandise.

ACS

Automated Commercial System - The Customs Automated Commercial System, ACS, is a joint public-private sector computerized data processing and telecommunications system linking customhouses, members of the import trade community and other government agencies with the Customs computer. Trade users file import data electronically, receive needed information on cargo status and query Customs files to prepare submissions. Duties, taxes and fees may be paid by electronic statement through a Treasuryapproved clearinghouse bank. ACS contains the import data used by Census to prepare U.S. foreign trade statistics.

Ad Valorem Duty

Duty imposed on imported merchandise based on a percentage of the value.

ADD

Antidumping duty - A tariff imposed to discourage sale of foreign goods at less than a fair market price that would be detrimental to local manufacturers. See Dumping.

120


TERMINOLOGY: A Glossary and Definition of Import/Export Acronyms TERM -ACRONYM

DEFINITION

Air Waybill

A bill of lading that covers both domestic and international flights transporting goods to specified destination. Technically, the air waybill is a non-negotiable instrument of air transport that serves as a receipt for the shipper, indicating that the carrier has accepted the goods listed therein and obligates itself to carry the consignment to the airport of destination according to specified conditions.

All Risk

Extensive insurance coverage of cargo including coverage due to external causes such as fire, collision, pilferage, etc., but does not include special risks such as those resulting from acts of war.

AMS

Automated Manifest System

APEC

Asia Pacific Economic Cooperation

APHIS

A branch of the USDA, the Animal Plant Inspection Service provides leadership in ensuring the health and care of animals and plants, improving agricultural productivity and competitiveness and contributing to the national economy and the public health.

Appraisement

The determination, by a proper Customs official, of the dutiable value of imported merchandise following procedures outlined in the Tariff Act of 1930, as amended.

Arrival Notice

This notice, which advises the consignee that cargoes have arrived, is issued by steamship lines and can also serve as the freight bill.

ASEAN

Association of Southeast Asian Nations

Assist

Items furnished to the producer either free of charge or at a reduced amount or used in the production of merchandise that will be imported. Examples include tools, dies, and molds. Artwork performed in the U.S. is not considered an assist. The value of an assist

ATPA

Andean Trade Preferences Act

AWB

Air Waybill

BEET

Business Executives Enforcement Teams

BIS

Bureau of Industry and Security

BL

Bill of Lading - A contract between the owner of the goods and the carrier. There are primarily two types of ladings. A straight bill of lading is nonnegotiable. A negotiable or shipper’s order bill of lading can be bought, sold, or traded while goods are in transit and is used for letter of credit transactions. The customer usually needs the original or a copy as proof of ownership to take possession of the goods.

Bonded Warehouse

A warehouse authorized by Customs authorities for storage or manufacture of goods on which payment of duties is deferred until the goods enter Customs territory. The goods are not subject to duties if reshipped to foreign points.


121


DEFINITION

Bureau of Census Department of Commerce

In relationship to imports, the DOC has two primary interests. The first interest pertains to the Committee for Implementation of Textile Agreements (CITA) which regulates certain textile imports under Section 204 of the Agricultural Adjustment Act. The second area of interest involves the collection of statistical data from import shipments.

Buying Commission

A buying commission consists of any monies paid to the buyer’s agent, who is controlled by or works on behalf of the buyer.

CACM

Central American Common Market

Cargo Selectivity System

The Cargo Selectivity System, a part of Customs Automated Commercial System, specifies the type of examination (intensive or general) to be conducted for imported merchandise. The type of examination is based on database selectivity criteria such as assessments of risk by filer, consignee, tariff number, country of origin and manufacturer/shipper.

CARICOM

Caribbean Common Market

Carnet

Customs documents permitting the holder to carry or send sample merchandise temporarily into certain foreign countries without paying duties or posting bonds. A carnet serves as both the entry document and a Customs bond.

Cartage

Movement of freight via trucking, draying or carting.

CBERA

Caribbean Basin Economic Recovery Act

CBI

Caribbean Basin Initiative

CCL

Commerce Control List

Certificate of Origin

Certain nations require a signed statement as to the origin of the export item. Such certificates are usually obtained through a semiofficial organization such as a local Chamber or Commerce. A certificate may be required even though the commercial invoice contains the information.

CF 3461 Immediate Release

All imported merchandise (other than merchandise admitted into a FTZ) must be released by U.S. Customs before it can be received by the importer/consignee. The CF 3461, Immediate Release, is the form used to obtain the proper release from Customs.

CFTA

Canada Free Trade Agreement

Classification

Classification is the categorization of merchandise according to the Harmonized Tariff Schedules of the U.S. Classification affects the duty status of imported merchandise. Simplified, it is the process of finding the tariff classification which best describes the imported good.

CM

Contract Manufacturer

CMC

Customs Management Center

122



DEFINITION

Compound Duty

Tax imposed on imported merchandise based on a percentage of value and also on the net weight or number of pieces, etc.

Consignment

Delivery of merchandise from an exporter (the consignor) to an agent (the consignee) under agreement that the agent sell the merchandise for the account of the exporter. The consignor retains title to the goods until sold. The consignee sells the goods for commission and remits the net proceeds to the consignor.

Consignor

The person or company shown on the bill of lading as the shipper.

Consolidation

The combination of many small shipments into one container, often with more than one destination/consignee.

Consumption Entry

Required by U.S. Customs for goods entering the United States. Information on the form includes cargo origin and description and estimated duties, which must be paid at the time the document is filed.

Container

Single rigid, sealed, reusable metal box in which merchandise is shipped by vessel, truck or rail.

Container Freight Station (CFS)

Facility used by ocean carriers to load/unload cargo to and from containers. Most less-than-container-load lots of cargo are either packed into or devanned at the CFS.

Country of Origin

Country where merchandise was grown, mined or manufactured.

Customs Broker

Individual or firm licensed by Customs to enter and clear goods on behalf of others through Customs.

Customs Territory

Includes the States, the District of Columbia and Puerto Rico

CVD

Countervailing Duty - A special duty imposed on imports to offset the benefits of subsidies paid to producers or exporters in the exporting country

Date of Exportation

The actual date the merchandise leaves the country of exportation for the U.S.

DCS

Destination Control Statement

Demurrage

Excess time taken for loading or unloading a vessel. Demurrage refers only to situations in which the charter or shipper, rather than the vessel’s operator, is at fault.

Devanning

Unloading of cargo from a container.

DOC

Department of Commerce

Dock Receipt

A dock receipt is used to transfer accountability when the domestic carrier moves the export item to the port of embarkation and left with the international carrier for export.

DOD

Department of Defense

DOE

Department of Energy


123


DEFINITION

Domestic Status

Domestic status material is Growth, product, or manufacture of the U.S. on which all IRS taxes have been paid.  Previously imported and on which duty and tax have been paid.  Previously entered free of duty and tax.

DOS

Department of State

DPL

Denied Persons List

Drawback

Refund of all or part of Customs duties paid on imported merchandise, which was subsequently either manufactured into a different article or re-exported.

DTRA

Defense Threat Reduction Agency

Dumping

The sale of a commodity in a foreign market at less-than-fair value. Dumping is generally recognized as an unfair practice because the practice can disrupt markets and injure producers of competitive products in an importing country. Article VI of the GATT permits imposition of antidumping duties equal to the difference between the price sought in the importing country and the normal value of the product in the exporting country.

Duty

Tax levied by the government on the import, export or consumption of goods and usually based on the value of the goods or some other factors such as weight or quantity or a combination of both.

EAA

Export Administration Act

EAR

Export Administration Regulations

EC/EU

European Community/European Union

ECCN

Export Control Classification Number

EFTA

European Free Trade Association

EL

Entity List

EMS

Export Management System

EPCI

Enhanced Proliferation Control Initiative

FACR

Foreign Assets Control Regulations

FDA Form 2877

Declaration for Imported Electronic Products Subject to Radiation Control

FDI

Foreign Direct Investment

FMS

Foreign Military Sales

Foreign Inland Freight Foreign inland freight consists of the charges to move the freight from the foreign factory to the place of loading. Foreign inland freight charges are dutiable unless the terms of sale are “ex-factory” or the charges were incurred incident to the international shipment.

124



DEFINITION

Freight Forwarder

An independent business which assembles, collects and consolidates lessthan-truckload freight. Also, a person acting as an agent in the transshipping of freight to or from foreign countries and the clearing of freight through Customs for compensation.

FTAA

Free Trade Area of the Americas

FTSR

Foreign Trade Statistics Regulations

GATS

General Agreement on Trade in Services

GATT

General Agreement on Tariffs and Trade

GDP

Gross Domestic Product

GSP

Generalized System of Preferences

Harmonized Tariff System (HTS)

The Harmonized Commodity Description & Coding System (or HTS) is a system for classifying goods in international trade, developed under the direction of the Customs Cooperation Council. Beginning on January 1, 1989, the new HS numbers replaced previously adhered-to schedules in over 50 countries, including the United States. For the United States, the HTS numbers are the numbers that are entered on the actual export and import documents. Any other commodity code classification number (SIC, SITC, end-use, etc.) is just rearrangements and transformations of the original HS numbers.

House Air Waybill

Contains all the information of an air waybill but is not a financial document. This is a contract between the shipper and freight forwarder. All the shipments covered by the individual house air waybills are consolidated, and a single air waybill is issued to cover the consolidated shipment.

IC

Import Certificate

IEEPA

International Emergency Economic Powers Act

Immediate Delivery

Customs entry procedure that provides for immediate release of a shipment prior to the arrival of merchandise although the merchandise must arrive within the port limits for the release to take effect. The entry summary with duties must be filed within 10 working days after release.

Importer Number

Identification number assigned by the Customs Service to track importers, usually IRS number for the company.

In bond

Procedure under which goods are transported or warehoused under Customs supervision until they are either formally entered into Customs territory and duties paid or until they are exported.

Incoterms

Maintained by the International Chamber of Commerce (ICC), this codification of terms is used in foreign trade contracts to define which parties incur the costs and at what specific point the costs are incurred.

Informal Entry

The informal entry is a simplified import entry procedure for most commercial shipments not over $2,000 in value. The statutory limit for informal entries is actually $2,500.


125


DEFINITION

Insurance Certificate

This certificate is used to assure the consignee that insurance is provided to cover loss of or damage to the cargo while in transit.

Intensive Exam

An intensive exam result means that Customs wants to physically examine the merchandise. Inspectors have the ability to “override” some intensive exams and convert them to general exams.

IPR

Intellectual Property Rights

ITA

Information Technology Agreement

IVL

Individual Validated License

L/C

Letter of Credit - A financial document issued by a bank at the request of the consignee guaranteeing payment to the shipper for cargo if certain terms and conditions are fulfilled. Normally, the letter of credit contains a brief description of the goods, documents required, a shipping date, and an expiration date after which payment will not longer be made.

LCL

Less than container load

Liquidation System

The Liquidation System, a part of Customs Automated Commercial System, closes the file on each entry and establishes a batch filing number which is essential for recovering an entry for review or enforcement purposes. An entry liquidation is a final review of the entry. The process of liquidation is currently under revision by the Customs Service.

Marine Cargo Insurance Broadly, insurance covering loss of, or damage to, goods at sea. Marine insurance typically compensates the owner of merchandise for losses in excess of those which can be legally recovered from the carrier. Losses may include fire, shipwreck, piracy, inclement weather and various other causes. Marking (or Marks)

Letters, numbers and other symbols placed on cargo packages to facilitate identification.

Marks of Origin

The physical markings on a product that indicate the country of origin where the article was produced. Customs rules require marks of origin of most countries.

MERCOSUR

Southern Common Market

MLA

Manufacturing License Agreement

Mod Act

The Customs Modernization Act is a comprehensive effort by the U.S. Customs Service to streamline and automate the commercial operations and improve compliance with Customs laws and regulations.

MOU

Memorandum of Understanding

MPF

Merchandise Processing Fee is a fee assessed for formal entries based on 0.21% of the invoice value, with a minimum of $25 per formal entry and a maximum of $485.

126



DEFINITION

NAFTA

North American Free Trade Agreement. A free trade agreement that comprises Canada, the U.S. and Mexico, exceeding 360 million consumers and a combined output of $6 trillion—20 % larger than the European Community.

NATO

North Atlantic Treaty Organization

NDA

Non-disclosure Agreement

Net Weight (Actual Net Weight)

Weight of the goods alone without any immediate wrappings (e.g., the weight of the contents of a tin can without the weight of the can).

NIS

Newly Independent States of the ex-Soviet Republic.

NVOCC

Non-Vessel Operating Common Carrier: A cargo consolidator of small shipments in ocean trade, generally soliciting business and arranging for or performing containerization functions at the port.

OAC

Office of Antiboycott Compliance

Ocean Bill of Lading

A receipt for the cargo and a contract for transportation between a shipper and the ocean carrier. It may also be used as an instrument of ownership which can be bought, sold, or traded while the goods are in transit. To be used in this manner, it must be a negotiable “Order” Bill-of-Lading. A Clean Bill-of-Lading is issued when the shipment is received in good order. If damaged or a shortage is noted, a clean bill-of-lading will not be issued. An On Board Bill-ofLading certifies that the cargo has been placed aboard the named vessel and is signed by the master of the vessel or his representative. On letter of credit transactions, an On Board Bill-of-Lading is usually necessary for the shipper to obtain payment from the bank. When all Bills-of Lading are processed, a ship’s manifest is prepared by the steamship line. This summarizes all cargo aboard the vessel by port of loading and discharge. An Inland Bill-of-Lading (a waybill on rail or the “pro forma” bill-of-lading in trucking) is used to document the transportation of the goods between the port and the point of origin or destination. It should contain information such as marks, numbers, steamship line, and similar information to match with a dock receipt.

OECD

Organization for Economic Cooperation and Development

OFAC

Office of Foreign Assets Control

Open Insurance

A marine insurance policy that applies to all shipments made by an exporter over a period of time rather than to a single shipment.

Packing Costs

Packing costs are defined as “the cost of all containers (except instruments of international trade) and coverings of whatever nature or materials used in placing merchandise in condition, packed and ready for shipment to the United States.

Packing List

A list showing the number and kinds of items being shipped, as well as other information needed for transportation purposes.


127


DEFINITION

Paperless

A paperless result indicates that the merchandise is low risk from a compliant importer. The broker places a stamp on the CF3461 and signs the document; thus, the merchandise is released without a Customs official ever looking at the documents.

PO

Purchase Order

Port of Entry

A port at which foreign goods are admitted into the receiving country; port where the imported merchandise is entered for consumption.

Port of Import

First port within the Customs territory where imported merchandise arrives.

Pro Forma Invoice

An invoice provided by a supplier prior to the shipment of merchandise informing the buyer of the kinds and quantities of goods to be sent, their value, and important specifications (weight, size, etc.).

Protest

A “protest” is the method primarily used by importers to take issue with Customs decisions with which they disagree. A protest is normally utilized as an opportunity to provide evidence that will result in the refund of duties and other charges that were erroneously paid.

Reasonable Care

“That degree of care which a person of ordinary prudence would exercise in the same or similar circumstances. Due care under all circumstances. Failure to exercise such care is ordinary negligence.”

Related Parties



Members of the same family, spouse, and lineal descendants Officers or directors if each individual is also an officer or director of the other organization  Partners  Person owning, controlling or holding with power to vote 5% or more of outstanding stock  Person who is an officer or director in both organizations 

SACU

Southern African Customs Union

SADC

Southern African Development Community

SDN

Specially Designated Nationals

SED

Shipper’s Export Declaration

Shipping Weight

Shipping weight represents the gross weight in kilograms of shipments, including the weight of moisture content, wrappings, crates, boxes and containers (other than cargo vans and similar substantial outer containers).

Ships Manifest

A list, signed by the captain of a ship, of the individual shipments constituting the ship’s cargo.

SLI

Shippers Letter of Instruction

SO

Sales Order

128



DEFINITION

Surety Bond

A surety bond is a promise or guarantee of payment to U.S. Customs in the event of a default in any terms of the importation laws. If the importer does not comply, Customs will look to the surety for payment and compliance.

Tare Weight

The weight of a container and/or packing materials without the weight of the goods it contains.

Tariff

List or schedule of merchandise with applicable rates to be paid or charged for each listed article. A schedule of duties or taxes assessed by a government on goods as they enter or leave a country.

Tariff Rate Quota

Permits a specified quantity of merchandise to be entered at a reduced rate during a specified period.

Tariff Shift

A change in tariff classification may be from one heading in a chapter to another heading in the same chapter. Some changes must be from one chapter to another chapter.

TDO

Table of Denial Orders

Textile Declaration

In addition to the original textile visa, shipments containing textiles must be accompanied by either a single or multiple country declaration which provides certification as to the article and country of origin.

Through Bill of Lading

A single bill of lading covering receipt of the cargo at the point of origin for delivery to the ultimate consignee, using two or more modes of transportation.

TIB

The Temporary Importation Bond (TIB) procedures allow importers to enter merchandise that will be exported within one year from importation for temporary use without paying duties. Merchandise entered under a TIB cannot be sold but can be repaired, altered or processed.

Trade Name

Name by which a commodity is commonly known in a trade; a name used as a trademark.

Trademark

A symbol, design, word, letter, etc., used by a manufacturer or dealer to distinguish his products from those of competitors and usually registered and protected by law.

Trailer

Vehicle without motor power designed to be drawn by another vehicle and so constructed that no part of its weight rests upon the towing vehicle.

Transaction Value

Transaction Value is the price actually paid or payable for the imported goods, with additions made for any dutiable items not included, or deductions made for any non-dutiable items included.

Transfer Pricing

Overpricing of imports and/or under-pricing of exports between affiliated companies in different countries for the purpose of transferring profits, revenues or monies out of a country in order to evade taxes.

Transship

Cargo, which is transferred from one vessel to another.


129


DEFINITION

TSCA

The Toxic Substances Control Act is intended to protect human health and the environment from unreasonable risks of certain chemicals. The EPA and U.S. Customs Service are responsible for keeping chemicals that have not undergone risk screening out of the United States.

TWEA

Trading with the Enemy Act

UCP 500

Uniform Customs and Practice for Documentary Credits

Ultimate Consignee

The ultimate consignee is the person located abroad who is the true party in interest, receiving the export for the designated end-use.

Ultimate Purchaser

The ultimate purchaser is generally the last person in the United States who will receive the article in the form in which it was imported.

URAA

Uruguay Round Agreements Act

USITC

U.S. International Trade Commission

USTR

United States Trade Representative

Value Added Fee

This method of pricing offers a base entry fee with extra charges for additional classifications, additional invoices, issuance of delivery orders, freight tracking, phone and fax charges and other miscellaneous services.

Visa

A visa is an endorsement in the form of a stamp on an invoice and consists of a stamped authorization that is usually circular, square, or rectangular in shape. The visa number normally consists of a standard nine digit number. * Click here for more on a textile visa.

War Risk

Insurance coverage for loss of goods resulting from any act of war.

Wharf age

A charge assessed by a pier or dock owner for handling incoming or outgoing cargo.

WTO

World Trade Organization

130


China Wholesale Secret

Recommend Documents