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Why should you prefer the Export-Import Business?

Export-Import Business is something which can help you in getting a huge amount of profit if channeled in a proper way. It can be a very challenging task if you wish to start an Export-Import Business. Before you understand the reason for choosing the Export-Import Businesss you must have a clear idea about the challenges you might face to start the Export-Import business or how to start the business.

There are many new entrepreneurs who may have many questions regarding this business ranging from legal guidelines to documents required. So there are a few steps which you must follow to start a business of Export-Import and then you can see some points that will help you in knowing the reasons for choosing Export-Import Business over other businesses.

A few Essential Steps Required to start an Export-Import Business are as follows

Getting a PAN Card- In order to start an Export-Import Business, a certain set of documents is very essential. If you are starting a business then you should have proper proof of your identity as well as the address that will help you in registering for your business. The most important step for any businessman is to apply for a PAN Card with the Income Tax department.

Selecting the type of business entity- Depending on the ownership’s structure, you must decide the form of your business for starting the Export-Import business . The next step comes is to register your business and then choose a proper name for your entity. You can form an LLP, Sole proprietorship firm, private limited company, partnership firm, or even a public limited company.

Opening a current account- A current account is usually defined as the ban account which is being used by business entities. A current account is very much essential to establish transactions with vendors and customers. Depending on the various business entities, the opening of a current account depends.

IEC Code-

The IEC code is very much essential for those who are planning to start an Export-Import Business . The application of the IEC Code will be supported by various documents. The Director-General of Foreign Trade will fill these documents.

Import Export Code

Choosing the export product- The key to your Export-Import Business plan is to choose the right product for your business. Many factors are there that you must keep in mind and this includes export trends, regulations, state of international markets, and many more.

RCMC- RCMC stands for Registration Cum Membership Certificate and is considered to be an important tool. There are many export promotion councils. If one is registered with these councils then they can get access to events and assistance that will help in expanding their business. The RCMC helps in registering with these councils. One week is required to complete the registration and the RCMC is known to be valid all over India.

Choosing the right export market- You must ensure that your service or product is having proper market somewhere in the world. Demand for the product is an important factor that the new exporters must keep in mind. Profitability, trade barriers, and political environment must also be kept in mind other than demand for the product. Depending on these factors, one must choose their export market.

Buyers for the product- Once you have selected your product and also the market, the next important step is to find buyers for your export service or products. Many ways are there for collecting leads, such as creating a proper website, participating in trade fairs, registering on the platform of buyers and sellers, and registering on government bodies like EPC. EPC stands for Export Promotion Council.

Getting finance in order- Initial financing is very much essential. No matter how many plans you make or how much effort you put in, without finance, the business cannot set off. Financial projections must be right.  Estimation is very much essential and after that, you can choose the type of export financing that will be suitable for your export business. This can be of two types either short-term financing or long-term financing depending on the requirement of your business. There are also subsidies from the government which you can access.  

Why should you choose the Export-Import Business?

If you have properly understood the challenges that you must face to start an Export-Import Business , now you must understand why you should choose this business. There are various advantages to this business. Profit margin is the biggest reason but other than this, many other reasons are there and they are as follows-

Opportunity- With the launch of a new attractive product, one can easily hold the market with new ideas and earn maximum profit from it which other businesses cannot provide. If some importing country is having any regular product without any substitute, you can surely hold that market with your product with some extra elements to it.
Huge profit from wide importers- Even if your own country is not accepting your goods, you will have options for other countries. This is the main thing which you can rest assured from your export business.

Benefits of government bonus- Government plays a vital role in supporting the exporters in many ways. Importers are paying from various countries and so there is a huge chance for growth of your country and get benefit from it.

Building global recognition- If you are responsible for exporting certain products and the product is present worldwide then that becomes trustworthy. People will always prefer to choose a brand that is present worldwide. You will receive more profit when more people are familiar with the product you are selling.

Saving costs- In the case of importing products, manufacturing costs can be reduced, and sometimes importing is easier and cheaper than manufacturing in own country.

Unique importer- Importing new and unique products helps in staying at the top of the market importing this new product will always help in becoming the leader of this Export-Import Market.

Conclusion

The Export-Import Business has always been profitable and the graph of this business is growing higher and higher day by day. The above reasons are the main reasons why you should choose an Export-Import Business. This basic knowledge will provide you guidance if you are new to the business.

 

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What Business Characteristics are Essential for a Successful Exim Business?

Business is not an easy task. Export Business or Import Business both are having a good amount of profit if they are done in a proper way under proper guidance. It is very challenging for a businessman who is involved in the Export-Import Business. There are many characteristics or skills which are essential for the Export-Import Business. These characteristics include finance as well as technology. The Export-Import Businessman must also have communication as well as interpersonal skills for developing their business and making it better than the rest.

Essential Characteristics for Exim Business

Right characteristics or skills is very much essential for any business and the same is the case for Export-Import Business. There are some essential characteristics that are required to make an Export-Import Business a successful one and they are as follows-

Accountability and Adaptability

Taking responsibility for the work is known as accountability and adaptability means the willingness of a person to change their thing with the change of circumstances. Accountability helps in building trust with the people you are interacting with internally with team members or externally with vendors or clients. A person who is adaptable in the Export-Import Business can easily face challenges.

Understanding of Budgets and Finance

The key to financial success is the one who is involved in the business must be financially savvy. This is very much essential for the person involved in the iExport-Import Business. The person involved in this business must have a good understanding of the accounting system. Moreover, they must also contribute to the process of budgeting.

Budgets in simple words are known to be the plan for spending that will help the business in setting goals as well as priorities for the financial year. Some of the major responsibilities include determining the budget, drafting the reports of expenditure, and to also ensure that the team is sticking to the budgets that have been approved.  

These financial skills are very much needed for the person involved in a small Export-Import Business. This is because they operate on a very small budget and their business can be hurt easily if there is any kind of deviation in the approved budgets.

Skills in Networking

Establishing interaction with many vendors or customers, such as transport service providers, freight forwarders and government agent representatives like customs officers is very essential. They must maintain a good relationship. Social media platforms can help in establishing connections. This will help in creating a business profile that will help in interacting with customers. This is also considered to be an effective way to build a proper network with government agencies, and stakeholders to attend various conferences organized by these bodies.

Knowledge of technology

Technology is something that is growing day by day and people are using basic technologies like using laptops, smartphones web-based applications, desktops, and cloud technology. Small businesses can leverage capital in an efficient manner with the help of technology. Moreover, they can also play a major role in increasing customer service, minimizing the cost with the help of automating routine tasks, accessing the global market, and taking documentation online. This is the main reason why organizations are becoming more competitive and efficient.

Because of the pandemic, there have been many disruptions in business worldwide and so there is an embrace of technology or even speeding up the transformation digitally so that they can survive. There are some technology tools that the Export-Import Businessman should know and they are-

  • Project management tool- These tools play a major role in scheduling and planning the jobs to be done with hassle-free documentation and evaluation by establishing collaboration with colleagues.
  • Inventory management software- This software plays an important role by helping the business to plan production, track stocks, plan procurement, and sales, and also prevents excess stocks and stock-outs. This helps in increasing productivity, improves cash flow, increases efficiency, and hence leads to saving costs.

Ability to handle stress

There are many times when a businessman involved in Export-Import Business will have to make certain decisions in a stressful condition. For example, there may be times when the cargo can be damaged or shipment is delayed. This is a very stressful condition and at that time you need to answer your customers about how you will proceed.. taking calm and measured decision is very important and is considered to be a valuable skill.

International Trade Compliance Requirements

Import Business and Export Business is governed by complex rules between different countries. Trade compliance is known to be the process of understanding and conforming to export and import laws including the regulation of a country. It also includes any kind of trade agreement that has been signed.

There are many companies where Export-Import Manager plays a vital role in trade compliance. The main role of the Export-Import Manager is that they will be ensuring that all the employees are well acquainted with the laws and regulations regarding import and export in various countries. If there is a failure then it will result in inspection, audit, and also penalties. This will in turn damage the relationship with your customers and will hurt your business in the future.

Ability in receiving feedback

Receiving feedback from customers is very important. The person must be able to take positive as well as negative feedback from customers and then act accordingly to take their business to a different level. If a customer is kept at the center then it will enhance the reputation of your business and will help in the long run.

Communication Skills

The main work is to deal with different stakeholders like government representatives, customers, and many more. Clear communication is very essential in this field to avoid any kind of misunderstandings. It is important that the people you are dealing with will understand clearly what you are saying and you will also understand what they have to say.

There are 12characteristics that lead to success in the marketplace for Export-Import Business and they are-

  • Curiosity
  • Adaptability
  • Confidence
  • Flexibility
  • Streamlining
  • Intelligence
  • Objectivity
  • Perseverance
  • Leadership
  • Wanderlust
  • Tact
  • Resilience

Conclusion

These lists of characteristics are very essential for Import Business as well as Export Business. Before proceeding with the Export-Import Business, it is important to acquire such skills in order to have a bright future for your business. This will help in building a reputed organization.

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What all things are Needed to Start an Import Business?

The International Trade business will always help in taking you all over the world along with multiple product niches from exporting light fixtures to importing exotic fashion. International trade can be considered to be one of the hottest industries of the new millennium. However, this cannot be considered as new as it has already started from the time of Marco Polo. Previously people use to deal with only silk and spices but this business has now expanded and there has been the inclusion of many products which are being imported and exported on a daily basis.

The existence of trade is because of the supply of one product that is present in one country but is demanded by other countries. International Trade is becoming more and more rewarding with the advancement of technology including the import business.

Basic knowledge to Start your Import Business

Lone footloose adventurer types are not the only ones for whom the importing is becoming renowned day by day. This business has grown a lot and the price amounts to around $ 1.2 trillion in a single year. This amount has been statistically proven by the U.S Department of Commerce. However, exporting is also considered to be as big as importing. According to various data, American companies were responsible for exporting around $ 772 billion to around 150 foreign countries.

The most important of all is to take a proper look at the players. Main variations are there on the main theme although you are having your importers and exporters.

EMC or the Export Management Company- The export operations of domestic companies that are wishing to sell their goods overseas are normally handled by the Export Management Company. The EMC plays a very beneficial role by hiring all the dealers, and distributors, invoicing customers, handling promotions, marketing, and advertising, and sometimes also arranging to ship. They also play a major role by arranging finance as well as contracting out that will help in developing a credit card app. EMC also sometimes become its own distributors by taking the title of the goods.

ETC or the Export Trading Company- ETC is responsible for attacking the other side of the coin of the market which is different from that of the EMC. It is responsible for identifying what the foreign traders are interested in and what they want to buy and then they make a selection for the domestic sources that are willing for exporting. An ETC also plays a role in taking title to the goods and sometimes also works on a commission basis.

Export-Import Merchant- The international entrepreneur is also known as the free agent. There is no specific client base for him and there is also no specialization for him in any individual product or market line. He plays a major role in purchasing the goods in a direct manner from the foreign or domestic manufacturer and then they pack, ship, and finally resell the goods on their own. So it can be said dissimilar from EMC he is responsible for assuming all the risk as well as all the profits.

Import Export Merchants

Things needed to start an Import business

There are various things that are very much essential for any business but the main things must be noted for each business. The same is the case for this Import Business. One must have a proper idea about the important stuff that is essential for the import business in order to earn a considerable amount of profit and have fun in this business field. People from different countries are getting involved in the import business and so there is nothing to be scared off. One must know the advantages as well as barriers to overcome them. Some of the important things that must be known are given below-

Target Market

Consumers are very much essential for each and every kind of business for their services and products. As you are now having the basic knowledge you must understand the business entails which must be planned by you along with targeting your market. It is very essential that you understand your potential clients. Moreover, you must also understand which geographical area you will be drawing from along with the specific product or services you will be offering to draw them in. If the market research is done in a proper way then it will help in building your project.

Startup cost

It is very essential that in order to make money, money is needed. In simpler words, it can be said that startup funds are very much essential. In the case of the Export-Import Business, the amount ranges from $ 5000 to even more than $25000. A Homebased business can also be started that will help you in saving a little bit of cost as you are not leasing any office or purchasing a lot of inventory for your office.

Marketing

Marketing is basically an art that cannot be performed by everyone. It is very much difficult to sell yourself and your company to the clients as a manager for Export-Import the products. Selling the products to the representatives by themselves is also very important. However, if one of them is achieved then the other can be achieved soon. A track record is very much essential. With each success, confidence will be gained and strategies for marketing will increase.

These were the main things that one must know is essential for starting an import business. However, three other things are also needed and they are given below-

  • Operations- people must know how their operations will be and must consult experts in this field.
  • Resources- Resources that they are having and what they will be needing are also important.
  • Income and billing- this factor must be taken care of in a proper way with proper expertise in this field.

Conclusion

Coming into business is not very difficult but to maintain the Import Business and take it to the limelight is very difficult. The import business is growing at a large rate and the above knowledge will help in guide you to understand what things are needed for import business.

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Which main challenges do exporters and importers face?

Before knowing about the challenges faced by importers and exporters one must have a clear idea about what imports and export are. International trade is not at all an easy task and so this guide will not only help in providing basic knowledge about imports and export but will also help in providing proper knowledge about the challenges that are being faced by importers and exporters.

What are imports and export?

Import-export business is at boom now but to enter this, you must have some basic ideas. In simple words, import can be defined as the services as well as the goods that are being purchased by the residents of the country from the rest of the world instead of buying items that are produced domestically. Imports are responsible for leading to a fund outflow from the country since there is an involvement of payment during import transactions to the sellers who are residing in another country.

Now exports can be described as the services as well as the goods that a country domestically produces but they involve in selling the product to other residents residing outside that country. An inflow of funds is led by exports to the seller’s country. This is because the transaction of exports is the involvement of selling domestic goods and services to foreign buyers.

Main challenges faced by importers and exporters

Global import can be rewarding in an incredible manner for retailers as well as distributors. But keeping all of these in mind there will still be some hurdles that must be overcome. Those who are new to this distribution, from highly monitored and complex procedures of import to the rules of trade, navigating multiple areas along with their local rules and regulations can be a minefield to the new distributors.

There are many challenges that are being faced by importers and exporters and the main ones are listed below which can help a person in overcoming the problems or challenges if they are known beforehand. The below points will for sure help in providing ideas about challenges and how to overcome them in a proper manner.

Sourcing of the goods

The first and foremost challenge that can be faced by any new person on this line is the sourcing of products high in quality from overseas looking for import opportunities that are new. varieties of factors are there that need to be overcome when searching for and preparing a relationship with manufacturers and brands overseas. It is better to consult any experienced distributor and retailers to overcome the problem or challenge.

Testing procedure

Once a product or range of products is found, that you are interested in testing in your own market, the next step comes the negotiation with the brand for a small and initial consignment. This is very easy to say but very much hard to perform. In order to mitigate the imported good’s risk of not taking off with buyers, it is very much important that one should come to an agreement with the partners overseas that will help in allowing you to test the water at a smaller amount.

This can be stated as the precursor to importing a large volume of products once the interest of the customer rises and they demand more. However, there are many manufacturers or brands that will play a major role in trying to insist on a larger volume so that they can make the pricing or production structure work. It is very important that one should find a proper way to consolidate the small consignment with others so that the shipping, as well as logistics, can be reduced.

Management of logistics

In the case of global importers, shipping, as well as logistics, can be a very big challenge for importers. It becomes a big issue when a person is new to the field as they will also not be having proper infrastructure that will manage from the various global regions. The coronavirus pandemic made a detrimental effect on international economics and trade with many areas having borders that started restricting the movement of goods. There were many existing purchase orders during this time that were put on hold which was responsible for the shortage of goods from weeks to months.

The air freight cost is very much high as there is no recovery of the costs of passenger travel. Moreover, there is limited space for cargo to be carried on flights. Importers and exporters can also face delays due to paperwork problems. It is always advisable to seek the help of experts to not incur a big loss for your company.

Equation’s staying part

The shifting of the supply chain in recent years with many retailers going to manufacturers and then cutting out the middleman that is the distributers is becoming common. This is one of the main reasons for which distributors are struggling to hold or maintain their position.  The rise of eCommerce sales is also another reason for which distributors are under immense pressure.

Conclusion

International logistic management is also another key thing that should be considered by the importer and exporter in order to achieve height. However, these were some of the challenges that are faced in recent days and once these challenges are known, then one can work hard to overcome the hurdles.

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What is use of the import export code?

In the world of foreign trade, Import Export Business is known to be one of the most common and hot terms. This sector helps you by allowing your business to grow in a rapid manner. Moreover, this will also help in increasing global reach. The economic infrastructure of a country is also dependent on this business as it helps in increasing a country’s economy by increasing the GDP. Gross Domestic Product (GDP) is an indicator of a country’s overall economic health and export import business plays a vital role in contributing to it. To engage in this business, one needs to obtain an Export Import Code (EIC) from the Directorate General of Foreign Trade (DGFT). EIC is a 10-digit code issued by DGFT that authorizes businesses to import or export goods. This code is required for all shipments above Rs. 25,000 in value.

Some important criteria are there which are very much mandatory for the business of import and export. One of them is the IEC code which is the Import Export Code registration. It is known to be one of the most important requirements for a person or any other type of business that deals with the import and export business. The Director-General of Foreign Trade is responsible for issuing the Import-Export code for industries and commerce.

What do you mean by Import Export Code?

One of the best options for new people is the IEC or the Import Export Code. This is known to be one of the first steps of registration for the people who are engaged in the import and export of products and services. The Director-General of Foreign Trade issues the IEC code which is having a unique code of 10 digits. This is known to be one of the most necessary documents for the Import-Export business.

A person can easily grow up the level of their business with the help of this IEC code. A business entity can use the IEC code once it has been issued and it is known to be the Import Export License. There is no need for the importer and exporter to renew or fill the issue. The IEC code is required by the importer who imports goods to its country and also to the exporter who exports its good from their country to another country. IEC is also required by the bank when there is a need for sending money abroad.

Uses of Import Export Code

Import Export Product Codes are essential for the person who are in this business as mentioned earlier. Ships carrying cargo play a major role in transferring the cargo or goods from one place to other and helps in importing and exporting goods. In order to unlock the corridors of the International economic and trade market IEC plays a major role. There is various use of this code as this is required by both importers as well as exporters. It is very important for an importer to clear the shipment from customs and here comes the role of the Import Export Code for the importers. Now for the exporters when they are responsible for exporting their items to other countries this code is asked by the customs. The major uses for this IEC Code are as follows-

  • Expansion of business is known to be the first and foremost use for this Import and Export Code as this IEC plays a major role in assisting a businessman to take their services as well as product to the global market.
  • A company can easily avail of various benefits with the help of this Import Export Code from customs, DGFT (Director General of Foreign Trade), and export promotion council depending on the registration of IEC.
  • Now for the exporters who get their payments by means of foreign currency and the transferring of money is taken place through the bank account of the exporter in a direct manner this IEC code is used.

There is also an Import Export HS code which is being followed by 200 countries all around the world. In order to execute the international trade agency the most systematic method that can be used is the IEC HS code. This code is having a unique code of 6 digits which is given for any particular item that is to be imported or exported.

Documents that are important for Import Export Code

Before knowing about the uses of the Import Export Code it is very much essential to know about the documents that are required for receiving the license for Import Export Code. They are as follows-

  • Pan Card copy for individual or Company.
  • Rent of agreement of the premises or electric bill copy.
  • Aadhaar card or Passport copy or Voter’s ID for an individual.
  • An envelope that is self-addressed for registered mail delivery of the certificate of Import Export Code.
  • Copies of cancel cheque of current bank account for firms, companies, or individuals.

There are also various benefits that can be avail by the use of this Import Export Code and they are the expansion of business, no requirement for renewal, no return filing, simple processing,  etc.

Conclusion

However, it is very essential to keep in mind that there are some places where the Import Export Code is not mandatory. According to the latest circular that has been issued by the Government, it is not mandatory for any traders who are having their registration under GST. So pan card of the user is used in this case as IEC code. This is also not essential for goods of personal purposes. The above points will surely help in guiding the Import Export Code and knowing about their uses as well as the things essential to receive this IEC.

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FY23 exports growth may slip, goods shipments seen

India’s exports growth may slow to 15-17.5% in FY23 but containment of Covid-19 through massive vaccination across the globe and creation of required capacity will be the decisive factors, the country’s top exporters body has said.

The Federation of Indian Export Organisations (FIEO) on Thursday said that FY22 is expected to end with merchandise exports of $400 billion, a growth of 37.6% over $290.6 billion of exports in FY21, but the aim for the next fiscal is $460-475 billion.

Since $400 billion would be a high base for FY23, an export growth of 30-35% on such numbers would be difficult, particularly as additional exports may require augmenting the capacity as well, FIEO said in a statement.

Looking into the emergence of the new variants (of Covid-19) and supply side challenges at this point of time, we would like to be a little conservative and will aim for an export of $460-475 billion during the next fiscal,” said FIEO president A Sakthivel.

Much will depend on the containment of Covid-19 through massive vaccination across the globe and creation of required capacity, which would decide whether India should look for 15-20% growth or even more for the next financial year.

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Exports up 36% on-yr in Dec 1-21

India’s exports in the first three weeks of December rose 36.20% on-year at $23.82 billion. Outbound shipments were 27.7% higher than the same period of 2019-20, sources said.

Export excluding petroleum, oil and lubricants increased 28.08% over the corresponding period last year.

In the third week of December, exports rose 20.83% on-year at $7.36 billion. Export excluding petroleum increased 24.56% over same period of FY21 and up by 29.25% over same period of FY20.

India aims to clock $400 billion of goods exports in FY22, a growth of 37.6% from $290.6 billion.

However, the country’s top exporters body has said that exports growth may slow to 15-17.5% in FY23 but containment of Covid-19 through massive vaccination across the globe and creation of required capacity will be the decisive factors.

The Federation of Indian Export Organisations said that FY22 is expected to end with merchandise exports of $400 billion but the aim for the next fiscal is $460-475 billion.

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How Importing and Exporting Impacts the Economy


With globalization, the world has become easily accessible for anyone who wishes to reach
out. Businesses, be it a small or a grand one, are spreading fast. And exporting and
importing goods have become one of the most important requirements.
When a business starts functioning internationally a lot of additional factors join the process
and the national and global economy stands at the top branch of it. The export and import
of goods not only pushes the business towards a better path but also takes an effective role
in expanding the economy.


How does it work?

Not all country has every necessary resource. While some countries own minerals or fossil
fuels, others possess precious metals. Similarly, some nations have an advanced
infrastructure while others do not. To balance and benefit one nation, it imports what it
lacks and exports what it has in huge quantities. And that is how one way or the other, all
the countries grow their economy.


What role does a nation play?
Importing and exporting activity of a country can directly impact its GDP, exchange rates,
and the level of inflation and interest percentages. Therefore, a nation’s economy plays a
significant role. A country with a strong currency hampers its exports and makes the imports
cheaper while a nation with comparatively weaker currency makes its imports costly and
fuels the exports.
Moreover, when the export rate is higher it would signify that the economy is advancing
better than overseas markets. But it may impact the exchange rates in a typical way. Thus,
maintaining a balance of imports and exports is very crucial for a country as it affects its GDP
and also balance of trade directly. A nation’s economy is accepted healthy when both its
import and export rates are growing. It designates the economy is strong enough.


Importance of Import & Export
Importing and exporting help small and medium start-ups and businesses greatly. By
importing goods, they get to save manufacturing costs and at the same get exposure to the
global market. In the same way, by exporting products they reach a larger market and earn
higher profit.
The system of importing and exporting products do not only profits the business but also
benefits the consumers. The customers get to purchase items that are not available locally
and are sold at higher prices. By buying the items directly from the manufacturer through
the internet save both their time and money.


Why approach EximIntell?
EximIntell is a leading import and export platform that has been providing the best quality
service across India for over 20 years. The team of EximIntell includes brilliant consultants

who possess not just experience in the field but also years of market research. They have in-
depth knowledge about how the domestic and international markets work.
Furthermore, understanding where to invest and which market can benefit you the most is
more than necessary. EximIntell organization offers high-quality consultation as well as
training programs, business start-up/set-up services, e-commerce services to businesses,
entrepreneurs, and interested learners. It is a one-stop solution for your import and export
business!

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