Imagine that you have started your own electronics export business. You invested a great deal of money, narrowed down your customers, markets and countries, looked over everything twice, sent your products for export, and settled in to see what happens next. And then….nothing! Quite disappointing, right? If you want to ensure that this doesn’t happen to you, keep reading this article.
There are a lot of advantages to exporting different electronic goods apart from just earning a foreign currency. They improve the production process as the domestic demand for such goods in India is still limited. Starting an electronic export business will provide you with an opportunity to learn about the latest global trends and Indian export trends and thus help us expose you to exceptional technological advancements. Continue reading this article to know everything about how to start an electronics business.
Step 1: Startup Cost
You can easily start your own electronics export business with a small amount of money. Firstly, you will need a phone and also a reliable internet connection. The next requirements will be investing in business cards, your fax machine, and your website. It will prove to be a great help for you if you will hire someone who will handle your branding with an elegantly simplistic logo that will define your brand.
Step 2: Selecting The Type Of Electronic Goods
Selecting the type of electronic goods that your brand will offer to the foreign customer is the first and foremost step. We will suggest you go with something you have the most experience in. When starting an import/export electronic business, keep in mind that your experience with your target area is an added benefit. Having a passion for something that you do can work wonders. You will understand the language of your business and might even have contacts right away. Some of the electronic goods you can go with are:
- TVs, ACs, Computers, Tablets, Smartphones, and laptops.
- Hearing aids, medical imaging and monitors, and artificial joints.
- Circuit boards, transistors, resistors, capacitors.
- Navigation and guidance systems, robotics, surveillance systems.
- Sensors, cruise controls, in-car computers, and more.
Step 3: Exploring Potential Customers And Markets
Selected the products you want to go with and figured out the start-up cost? Now is the time to narrow down your market focus. This will help you and your electronic export business in concentrating on the market you can serve the best. Think about:
- Type of customers
- Target areas of the world
- Types of goods for each area
Step 4: Narrowing Down The Target Countries
If you are thinking of starting an electronic import/export business in India, you need to think about your competitive advantages as well. Identify the list of countries you want to do business with. Ask yourself these questions:
- Am I aware of the culture of a certain country and know a lot about it?
- Have I travelled to other countries before?
- Do I have connections in other countries?
- Have I travelled extensively to a particular country? If yes, then which one?
- Do I speak a foreign language?
Investigate and know about the different requirements of various countries for conducting your electronic export business. Knowing all these things before you make a final decision will give you a competitive edge.
Also read: Semiconductor Manufacturers In India
Step 5: Registering The Export Business
To register your import/export electronic business, you will need to complete the registration with the Director-General of Foreign Trade (DGFT). You need to submit the required documents such as bank details and DSC. Then, you will be allotted an Import Export Code and your application will be processed further. Your IE code is valid for a lifetime and it will last until the business stops or the registration is surrendered. Once the authorities have verified your documents and application, you will be granted an import-export license as a soft copy for your electronics export business.
Step 6: Charges For Your Services
When you opt for the commission structure, you are paid a specific percentage of the trade deal that you will close. On top of the commission cost, you can also charge for packaging and shipping expenses.
In this model, your clients will be paying you a monthly fee to be on call when they require your services. Consider your costs as this may include supplies, labour, overheads, and more expenses in your electronic export business.
There is always a second option available. Instead of opting for a commission or retainer structure, you can simply buy and sell goods. Your revenue in this case will come from the profit that you will thus make by selling your merchandise.
Also Read: Best TV Brands In India
Step 7: Choosing A Suitable Business Model
If you think your electronic goods are easy to sell then we will recommend you to go with the commission model and if they are difficult to sell, go with the retainer model. You would like to be paid based on your performance in your electronic import-export business if you can sell a lot of goods. If you think that your sales can slow down then a retainer model will make sure you get paid even in the downtime. Once this is done, all you need to do is to negotiate with the suppliers at what price you will buy the products and then find your way to profit from your stock.
Step 8: Possible Risks and How To Avoid Them
Uncertain Shipping Logistics:
Your success depends on your ability to sell those electronic goods safely and efficiently. You are the person responsible for making sure that your goods leave your port and arrive at their destination on time. Keep in mind that only you will be held accountable for any other things that might go wrong such as damaged goods. Stay organised and partner with the freight forwarder you trust who will help you ship your goods without any problems.
Not Enough Knowledge:
Before entering into an electronics export business, it is important to do thorough research. Sometimes, even that is not enough. You can hire experts who have a great knowledge of the culture and taste of your specific customers and markets. You will need to sell your electronic goods that are high in demand in the countries you are not familiar with.
Problems At The Border:
Understand that custom rules aren’t the same around the world. You will run into a lot of different rules while transporting your goods. To avoid problems at the border, we recommend you hire people who are experts in custom laws and trade compliance.
If you love building relationships with other countries then an electronic export business is the right option for you. You should have an organised mind and the ability to handle logistics then nobody can stop you from gaining success. If you have these qualities, jump in at the deep end and create a flourishing electronics export business. We hope this article helps you in the long run.
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Q. Is any specific paperwork required for the electronics export market?
Ans. Depending on the types of electronic goods you are exporting, you may require a commercial invoice, customs packing list, bill of sight, letter of credit, COO certificate, and other documents.
Q. How much does it cost to start an export business?
Ans. Initially, it will require you to invest around Rs. 70,000 for setting up an export business in India.
Q. Which bodies can assist us in our electronics export business?
Ans. The Ministry of Commerce, National Small Industries Corporation (NSIC), ELCINA, and Electronics and Computer Software Export Promotion Council are the bodies that can assist you in your electronics export business.
Q. What are different criteria points for entering into an electronics export business?
Ans. QCD approach, complying with standards, legislation, regulation, surcharges and other restrictions are different criteria points for entering into an electronics export business.
Q. What are some points that we need to keep in mind while exporting electronic goods?
Ans. Keep in mind exporting pricing and costing, special packaging and labelling requirements, government policies and procedures and special measures to be taken during the transportation of your products.