In 2015, Zimbabwe exports were valued at $2.7 billion while imports were valued at $6 billion dollars. Operating an import export business in Zimbabwe is highly profitable but it requires hard work and dedication. On this one, you don’t count leave days or overtime. It requires an individual who can adapt and can work at the pace that the business requires. The import export business doesn’t require much capital and one does not necessarily need to have own product to succeed. To kick start the export import business, market research is required and can help you establish the countries you wish to export to and the products niches. The internet can be put to use to research your potential buyers and to fully get to know about them before engaging them. A website may be your best chance of advertising the export import business. It is rare for people to engage in business with companies that cannot be found on the internet.
Types of Import Export Business
The import and export business is wide and let us break it down into three most viable sections which are more suitable with minimal costs.
You may handle an export business for a domestic company that has an interest in exporting but is not keen in knowing how to handle this type of business. Your job is to hire dealers, distributors, representatives, handle advertising, marketing and promotions, oversight of packaging, shipping arrangements and even financing arrangement. In some instances, you may take ownership of goods and thus become the distributor. Your area of specialization can be done by product, foreign market or both. Remuneration may be commission based or a salary.
You will be providing services to foreign buyers who would want products from the domestic market. You will have to do market research so that you link the buyers and sellers.
Import/ Export Merchant
This would perfectly fit the market for most entrepreneurs who wish to join the import export business in Zimbabwe. As merchant, you simply identify foreign buyers, and determine what products they want from Zimbabwe. You then track down domestic manufacturers and distributors who manufacture the products. After that you pack, ship and resell products under your brand. Thus you will be taking all risks involved. Your line of business may vary depending on the change in choice of your client base. On the upside, it means you get all profits. The profits may be massive if you properly manage your products and volumes.
You have to carry out market research and write a good business plan before you start the import export business. Below is a list of a few areas to consider investigating (in depth) before considering moving into this business
- The product/ service to provide
- Who is the end user? Is it mass market consumption, light industry, government?
- Which countries to import and export to
- Which trade channel is feasible? Direct sales, distribution?
- Are there any permits or licences needed to import and export the goods?
License or Permit
Companies usually choose to do business with a licensed individual or one with a permit to carry out such a trade. Having a license will help in cementing your reputation and such information can be added on the website. You also require import and export permits and licences for certain goods. If you don’t have the required permits and licenses, your goods maybe detained by ZIMRA. Permits are issued by different ministries under which your importation lies. You should first carry out a research of the permits and licences required for the kind of goods you will be importing or exporting.
You will require premises for your import export business. Once you set up your network, that is you have signed your trade agreements with clients, you may proceed to look for offices and warehouse to stock your goods. In some instance, warehouses may not be required since you may get your goods straight from the manufacturer and load into trucks. Emphasis is on starting the import export business with minimal costs and thus you may need to enter into an agreement with an entrepreneur in the trucking business. The trucker owner may help you in delivering goods to the various destinations.
The import export business come with high risks and thus requires you to insure your business. Insurance policies vary due to the uniqueness that the industry comes with and therefore it is imperative that you select an insurance cover that reflects your specific needs. You can get import insurance and export insurance to cover your business and whatever damages to your products during transit.
Management and Staff for Import Export Business
The number of staff required will depend on the scale of your business. Some employees may be part time e.g. people who would help in loading the trucks with goods. You will also need accounting, finance, marketing and operations personnel.
Zimbabwe is actively involved in international trade. The market for imports and exports is huge. One needs to ascertain the products to be exported and quantities. In order to fully capture your market, you need to zoom in and get contracts only on quality products. Planning is pivotal as it will help you determine your potential clients you’re your target geographic locations. To turn your import export business into a profit center, you need to carry out a massive market research as highlighted earlier and select your perfect niche. This is because any product is fair game as long as you have the skills to convince and get clients.
Costs and Profitability
Putting in sufficient capital will help fully establish your import export business. Startup costs may range from at least $5000 to more than $250000 for this business. If you do not have sufficient capital, then to reduce costs you may locate your office at home. Funds may be set aside for the acquisition of a computer, printer and fax. Most importantly you need internet access. At first you may not need employees or inventory (unless you are a distributor). The key is in building relationships which will help you get big import and export projects. Have a positive mindset and treat your business relationships like assets.
Income ranges and mostly it is based on the amount of effort put into marketing and creating long time partnerships and relationships which will prove worthwhile. The number and size of transactions you do will determine your revenue. Annual gross income may range from as little as a few thousand dollars to millions of dollars. You just have to put in the time and you will surprised at the pace at which you can manage multi-million dollar projects.
Why is the import export business viable?
International trade will never die. In this present day and age, no country can survive in isolation.
Availability: It is impossible for an economy to produce everything and even grow most products. This creates a gap and the need for import and export. Zimbabwe imports most of its products. We import everything from electronic gadgets (laptops, cellphones e.t.c) to clothing, motor vehicles and even food.
Price: From a cost perspective, some goods are cheaper when imported from outside the country. For example Chinese electronic gadgets, Korean toys, Mexican clothing and raw materials such as coal, gold, platinum from Africa.
Reputation and Image: The rich and famous are found and scattered all over and they prefer to maintain their lifestyles by importing products such as caviar and champagne. Class therefore cannot be home grown to replace Egyptian cotton, Scandinavian furniture, French perfume and ancient Roman paintings and books.
We wish you the best in your import export business. Check out more business ideas and our collection of business plans. Like us on Facebook, follow us on Twitter, and subscribe to receive notifications of new posts in your email.
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