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Step by Step Export Process

Basics of Export procedures

The major concern of international trade is related to import and export of goods and services. Export
orders must conform to the terms of a contract between buyer and seller and in most case, the contract
is sent from the foreign buyer. Before the confirmation of a contract, it must be scrutinized with the
product details and their specifications, terms of payment, price, delivery schedule, etc.
The immediate task of an exporter is to acknowledge the export order which is different from its
acceptance. Then s/he should proceed to examine the export order carefully concerning the item,
product specification, pre-shipment inspection, payment conditions, special packaging, labeling and
marking requirements as well as shipment and delivery date, marine insurance, documentation etc. If
the exporter is satisfied with these aspects, a formal confirmation of the export order is sent from the
buyer’s end and exporter should proceed to enter into a formal contract with the overseas buyer. The
aspects relating to the process of an export order are discussed as under:
Before starting the export business, a manufacturer cum exporter has to collect some documents which
will widely use in executing export/import order. They are;
 Trade License
 TIN License
 VAT License
 Memorandum of Association and Articles of Association
/Partnership Agreement
 Certificate of Incorporation
 Rent Agreement or Ownership proof
 Holding Tax payment receipt
 NoC declaration from the Local Authority
 Bank Account and Solvency Certificate
 Fire Service License
 Environment Clearance Certificate
 Membership Certificate from incumbent Association/Chamber.
 Group insurance for the workers employed in the factory
 Approved Building layout plan and structural design from
concerned govt. authority
 Export Registration Certificate (ERC)/ Import Registration
Certificate (IRC)
Process flowchart of Exporting product

Nature:
Export order is a document from any specific foreign buyer to purchase items from the exporter. It
would indicate the exporter’s Pro-forma invoice/quotation number and issuing date, including item,
quantity, price, delivery date, shipping marks, insurance, payment terms etc. Before acceptance, the
export orders should be scrutinized in all aspects. The following documents are commonly used in
exporting.
1. Pro-Forma Invoice
2. Bill of lading
3. Commercial invoice
4. Certificate of origin
5. Inspection certification
6. Dock receipt and warehouse receipt
7. Destination control statement
8. Insurance certificate
9. Export license (ERC)
10. Export packing list
The process of exporting product starts after communicating with buyers. In this case, we will discuss
the process covering the RMG product. In general, an exporter exports his product following these ten
steps.
 Step -1: Communicating with Buyer
The starting point for any Export Transaction is an inquiry. An inquiry for the product should, inter alia,
specify the following details or provide the following data.
 Size details of products – Std. or oversize or undersize, Drawing – if available, Sample – if
possible, Quantity required, Delivery schedule.
 Mode of Dispatch – Sea, air or Sea/air.  Mode of Packing.
 Price requirement on FOB or C & F or CIF basis
 Terms of Payment which would be acceptable to both end of Buyer and exporter; buyer or
exporter can propose to open Letter of Credit or any specific valid transaction process which is
to be compiled from both ends.
 Any requirement of Pre-shipment inspection if needed and then specify agency.
 Any Certificate of Origin required – If so, from which agency.
 Or any other requirements.
 Step -2: Pro-forma Invoice (P I) Generation
In the second step of exporting, Manufacturer Exporter or Merchant Exporter will study the inquiry in
details and forward the related query to the incumbent persons to gather the answers. After that, he
will provide a Pro forma Invoice to the Buyer as per the demand of buyers.
A sample of pro forma invoice has been attached in annexed for your better perception.
 Step -3: Order placement and Acceptance

If the offer is acceptable to the Buyer in terms of price, delivery and payment, the Buyer will then place
an order to the Exporter, giving as much data as possible in terms of specifications, quantity etc.
Under international business transaction mode, both exporter and importer define their roles and
responsibilities to each other with sales contracts. A sale contract is a legal binding document for both
parties. In practice, a small volume of international sales is handled by Pro-forma invoices whereas
medium size sales are covered under sale contracts. Big volume of sale contracts should be written by
lawyers. In addition to the volume of the trade transaction, the duration of the business is another point
of consideration when deciding to use a Pro-forma invoice or sale contract. If the business transaction
will be completed over a while such as 1 year or more than that period, sale contracts should be
preferred instead of Pro-forma invoices.
At this stage, the exporter requests the importer to open an irrevocable letter of credit (L/C) in favor of
an exporter in a nominated scheduled bank.
After getting the L/C confirmation, Exporter immediately acknowledges receipt of the order, giving a
schedule for the delivery committed.
 Step – 4: Goods readiness & documentation
Once the buyer accepts the offer and places an order, the marketing merchandiser schedules a
production plan and also trace the status of production. In the meantime, approving sample from the
buyer and also maintaining the quality is mandatory. After that, when goods are ready and duly packed
in Export worthy cases/cartons (depending upon the mode of dispatch), the commercial Invoice is
prepared by the Exporter. A sample of the commercial invoice has been attached in annexed 2 of this
book.
If the number of packages is more than one, a packing list is a must.
 Step – 5: Documents for C & F agent
Exporting any products through the valid channels, exporters may need to handle a large number of
documents depending on the requirements of both exporter’s government and the government of the
importing country.
In such a situation, most of the exporters seriously consider having the clearing and forwarding (C&F)
agent to handle the formidable amount of documentation that exporting requires since C&F agents are
specialists in this process. The C&F agent should be a reputed firm with experience in handling
export/import cargo. If the goods are to be exported by sea, the C&F agent should have branches in the
major ports like Chattogram and Mongla.
Thus, the exporter will hand over the following documents to the C&F agent for forwarding the export
goods to shipping agent through customs. Necessary papers related to C&F agents and exporter are;
 Commercial Invoice and Packing List.
 Export Manifesto.
 Copy of Letter of Credit
 Packing List.
 Certificate of Origin and Export Registration Certificate
 Under the claim of Drawback of duty.

 Export Form
 Any other declarations or documents as required by Customs.
 Bill of Export will be generated by the Customs based on the above documents.
 Step – 6: Customs Clearance
C&F agent presents the required documents to the customs for letting the consignment to export. After
assessment of the shipping bill and examination of the cargo by Customs (where required), the export
consignments are permitted by Customs for ultimate Export. This is what the concerned Customs
officials call the ‘LET EXPORT’ endorsement on the shipping bill.
 Step – 7: Document Forwarding
After completing the shipment formalities, the C&F Agents are expected to forward to the Exporter the
following documents:
 Customs signed Export Invoice & Packing List.
 Duplicate of Form Export Manifesto.
 Exchange control copy of the Shipping Bill / Bill of Export.
 Bill of Lading or Airway bill, as the case may be.
 Step – 8: Bills negotiation
The Exporter will have to negotiate the relevant export bill through authorized dealers of Central Bank,
viz., Banks with these authenticated shipping documents as payments terms mentioned in the L/C.
Broadly, payment terms can be:
 DP Terms (Documents Against Payment)
 DA Terms (Documents Against Acceptance)
 Letter of Credit, payable at sight or payable at… days.
Under the Generalized System of Preference (GSP), imports from developing countries enjoy certain
duty concessions, for which the exporters in the developing countries are expected to furnish the GSP
Certificate of Origin to the Bankers, along with other shipping documents.
 Step – 9: Bank to bank documents forwarding
The negotiating Bank will scrutinize the shipping documents and forward those to the importer’s bank.
After receiving these documents, importers bank will hand over these documents to the importers as
per negotiation for clearing the consignment.
It is expected of such authorized dealers of Central Bank to ensure receipt of export proceeds.
 Step – 10: Receipt of Bank certificate
Authorized dealers will issue Bank Certificates to the exporter, once the payment is received and only
with the issuance of the Bank Certificate, the export transaction becomes complete.

It is mandatory on the part of the Exporters to negotiate the shipping documents only through
authorized dealers of Central Bank, as only through such a system Central Bank can ensure receipt of
export proceeds for goods shipped out of this country.
At last, the exporter should give thanking remarks for doing business with him and also sustain the
business relationship.