An import-export business is a business that engages in the importation of goods from other countries and the exportation of goods from your home country to other countries. Please note that the main difference between import and export is that import refers to bringing in goods from other countries while export refers to selling goods from your home country to other countries.
Available statistics on Statista show that in January 2022, the value of exports from the United Kingdom amounted to 50.8 billion British pounds, while imports into the country amounted to 66.9 billion pounds, resulting in a trade deficit of 16.2 billion pounds.
The top 5 products that are exported from the UK to other parts of the world are Crude oil (£20.0bn), Pharmaceutical products (£26.3bn), Electrical machinery – £27.7bn, Cars (£32.7bn), and Mechanical machinery (£48.5bn).
The top imports of the United Kingdom are Gold ($83.7B), Cars ($32.8B), Broadcasting Equipment ($15.8B), Packaged Medicaments ($14.8B), and Crude Petroleum ($14.8B); importing mostly from Germany ($74.4B), China ($73.1B), United States ($48.6B), Netherlands ($40.3B), and France ($30.3B).
Steps on How to Start An Import Export Business in the UK
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Conduct Market Research
If you are considering starting an import and export business in the UK, you would need reliable market research to be able to maximize profits from the business. The first step in the market research process for your import and export business in the UK should be to develop market-based research questions in line with your overall business goal and objective.
In this regard, you should source information that will help you maximize your business, tell you what your potential market will be looking out for from an import and export business in the UK, and also help you operate your business in the UK with less stress and of course, build the business to profitability.
a. Who is the Target Market for an Import and Export Business?
- Merchants
- Production companies (raw material needs)
- Wholesalers of goods and materials
- Contractors
- Businesses and individuals (cars and other equipment).
b. Is Import and Export Business in the UK a Profitable Business?
Yes, the import and export business in the UK is very profitable. The UK is not self-sufficient in food production; it imports 48 percent of the total food consumed and the proportion is rising. Therefore, as a food-trading nation, the UK relies on both imports and a thriving agricultural sector to feed itself and drive economic growth.
c. Are There Existing Niches in the Industry?
Yes, there are existing niches when it comes to the import and export business. Here are some of them;
- Crude oil
- Pharmaceutical products
- Electrical machinery
- Cars
- Mechanical machinery
- Food and agriculture produce
- Gold
- Computers and gadgets
d. Who are the Major Competitors?
- ABTS Logistics Ltd
- Arrow Export
- Best Export
- Howard & Sons Export Limited
- Open to Export
- RH Amar & Co. Ltd.
- Simply Exports
- UK Exporters Ltd.
- Cargo Worldwide UK
- Cohen Traders Ltd.
- Clearance King
- Sulis Import Solutions
- WTE UK Limited
- YOREL Ltd.
- My Car Import Ltd.
- On Target Merchandise (UK) Ltd.
- ZAN Enterprise
- MDW Global Trade
- TAFCOM International Trading
- White Bird Logistics and Warehousing.
e. Are There City Regulations or Zoning Laws for Import and Export Business in the UK?
Yes, there are regulations and zoning laws for import and export businesses in the UK. For example, the Customs Tariff (Preferential Trade Arrangements) (EU Exit) Regulations 2020 (SI 2020/1457) give effect to the preferential import duty rates, including related rules of origin requirements, in trade agreements that the UK has entered into with other countries.
It is important to also state that in the United Kingdom, an import license is not needed to import most industrial goods. However, some industrial goods need import licenses as a result of controls imposed at the national or UN level. These are issued by the DIT’s Import Licensing Branch.
f. Is There a Franchise for Import and Export Business in the UK?
No, there are no franchise opportunities for import and export businesses in the UK.
g. What Do You Need to Start an Import and Export Business?
- A Feasibility Report
- Business and Marketing Plans
- Business Licenses and Permits (Import License)
- A registered address (office facility)
- HM Revenue and Customs (HMRC) for Value Added Tax (VAT) and/or Pay As You Earn (PAYE)
- A Corporate Bank Account
- Employees
- Startup Capital
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Choose a Memorable Business Name
When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.
Some of the catchy business name ideas suitable for an import export business are;
Creative Import Export Business Name ideas for UK
- Barry Trade Ltd.
- Export Pro Ltd.
- Dozier© Import and Export, Ltd.
- Sea Way Traders Ltd.
- Coman Trading Ltd.
- Over Sea™ Import and Export Ltd.
- All Day© Import and Export, Ltd
- Present Day Trading Ltd.
- George Finney© Import and Export, Ltd.
- King’s Court Trading Ltd.
- Larry Duncan® Import and Export, Ltd.
- ED Nelson Trading Group, Ltd.
- Lowey Martins™ Import and Export, Ltd.
- Beckham Peckham Trading Group, Ltd.
- Game Changer® Import and Export, Ltd.
- Themes Trading Group, Ltd.
- Rees Morgan™ Import and Export, Ltd.
- Big Deal© Import and Export, Ltd.
- Gray Horizon® Import and Export, Ltd.
- Planet ZED™ Import and Export, Ltd.
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Register Your Business
a. What Type of Business Structure is Best for Import and Export Business in the UK?
The United Kingdom has a wide array of options that you can choose from if you are looking for a business structure to build your business on. The most important thing is that you should select a business structure that will best serve your overall business vision and mission.
In the UK, you can start your business as a Sole trader, Limited company, Private limited company (LTD or Ltd), a Public limited company (PLC), a Limited liability partnership (LLP), or a Guarantee Company (LBG).
b. Steps to Register a Business in the UK
One of the most important steps you should take on your quest to start a business in the UK is to register the business name with the regulating authority. You can register your new business at Companies House on GOV.UK. Please note that the entire process will take you about 30 minutes if you have all the required details ready before approaching them.
In the United Kingdom, you can register your business online but it will cost you £12 to register a company online (you can pay this fee via PayPal, debit card, or credit card). It takes on average 24hrs for your company to be registered.
Please note that to register a business in the UK, you will need to submit the following documents and information:
- A company name (You can find more information on naming your company below).
- Valid ID
- Address for the company.
- One or more directors’ names and details (if it is just, you that is fine).
- Details of the company shares, shareholding, and shareholders (with at least one shareholder).
- A Memorandum and articles of association. This is a standard document that shareholders create and agree to that outlines the company’s written rules, it’s usually very standardized unless you have specific needs.
- Detailed information on anyone who owns a significant interest or control in the company (this means anyone who owns 25% or more shares or voting rights in the company).
c. What Type of License is Needed to Open an Import and Export Business in the UK?
- General Business License
- Import Export License
- Operational State Facility Inspections
d. What Type of Certification is Needed to Open an import and export business in the UK?
You don’t need any certifications to open an import and export business in the UK.
e. What Documents are Needed to Open an Import and Export Business in the UK?
- Business and liability insurance
- Council Permit
- HM Revenue and Customs (HMRC) for Value Added Tax (VAT) and/or Pay As You Earn (PAYE)
- State Permit and Building Approval
- Certificate of Incorporation
- Business License (Import and Export License)
- Business Plan
- Employment Agreement (offer letters)
- Insurance Policy
- Online Terms of Use
- Online Privacy Policy Document
- Contract Document
- Company Bylaws
f. Do You Need a Trademark, Copyright, or Patent?
If you are considering opening an import and export business in the UK, usually you may not have any need to file for intellectual property protection or trademark. This is because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
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Cost Analysis and Budgeting
a. How Much Does It Cost to Start an Import and Export Business in the UK?
There are no clear-cut startup costs for an import and export business in the UK. Have in mind that the costs involved in opening an import and export business in the UK can run into tens of thousands of pounds, depending on your business size and what you intend to export or import, and of course, the destination (country you intend to import from or export to).
b. What are the Costs Involved in Starting an Import and Export Business in the UK
- Business Registration Fees – £12.
- Legal expenses for obtaining licenses and permits – £1,300.
- Marketing, Branding, and Promotions – £1,000.
- Business Consultant Fee – £2,000.
- Insurance – £1,400.
- Rent/Lease – £35,000.
- Other start-up expenses include commercial satellite TV subscriptions, stationery (£500), and phone and utility deposits (£1,800).
- Operational Cost (salaries of employees, payments of bills et al) – £30,000
- Trading Capital – £1 million
- Store Equipment (cash register, security, ventilation, signage) – £1,750
- Furnishing and Equipping – £7,500
- Website: £600
- Miscellaneous: £1,500
c. What Factors Determine the Cost of Opening an Import and Export Business in the UK?
- The size of the import and export business
- The choice of location (the destinations you want to export to and import from)
- The required licenses and permits
- The types of goods you intend to export or import
- The cost of hiring and paying a business consultant and attorney
- The cost for branding, promotion, and marketing of the import and export business
- The cost of furnishing and equipping your office facility
- The cost of insurance
- The cost of registering the business
- Source of your ongoing expenses
- Cost of recruiting and training your staff
- The cost for the purchase and customizing of uniforms
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?
It is not compulsory to build a new warehouse facility for your import and export business in the UK, but if you have the required finance, it will pay you to build your own warehouse facility. The truth is that building or reconstructing a warehouse facility will help you come up with a warehouse facility that will perfectly fit into your overall business goals and vision.
e. What are the Ongoing Expenses of an Import and Export Business In the UK?
- Supplies (inventory expenses)
- Clearing and forwarding fees
- Shipping fees
- Utility bills (internet subscriptions, phone bills, signage, and software renewal fees et al)
- Salaries of employees
f. What is the Average Salary of your Staff?
- Chief Executive Officer (President) – £65,000 Per Year
- Logistics and Merchandise Manager – £22,630,000 Per Year
- Accountant – £28,100 Per Year
- Clearing and Forwarding Liaison Officer – £26,200 Per Year
- Customer Services Executive – £26,000 Per Year
g. How Do You Get Funding to Start an Import and Export Business in the UK
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Source for soft loans from your family members and your friends.
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Write a Business Plan
a. Executive Summary
Game Changer® Import and Export, Ltd. is a licensed and registered import and export business that will be based in the UK with an operational office close to the Port of Birmingham. We will be involved in the importing and exporting of goods that are in high demand in the United Kingdom.
b. Products and Service
- Crude oil
- Pharmaceutical products
- Electrical machinery
- Cars
- Mechanical machinery
- Food and agriculture produce
- Gold
- Computers and gadgets
c. Mission Statement
Our mission is to establish an import and export business that will help contribute to the GDP of the United Kingdom.
Vision Statement
Our vision is to build a global brand.
d. Goals and Objectives
The goals and objectives of an import and export business are basically to bring in the goods that are needed in a country and sell those that are produced in a country to other nations.
e. Organizational Structure
- Chief Executive Officer (President)
- Logistics and Merchandise Manager
- Accountant
- Clearing and Forwarding Liaison Officer
- Customer Services Executive
Marketing Plan
a. SWOT Analysis
Strength:
- Ideal location for an import and export business in the UK
- Highly experienced and qualified employees and management
- Access to finance from business partners
- Reliable and efficient inventory management system.
Weakness:
- Financial constraints
- The new business will be competing with well-established import and export companies in the UK.
- Inability to retain our highly experienced and qualified employees longer than we want during the teething stage of the business.
Opportunities:
- Increase in the demand for goods manufactured in the UK
- An increase in the demand for food and agricultural produce from other countries
- Online market, new services, new technology, and of course the opening of new markets.
Threat:
- The arrival of new import and export business within our market space that are into the importation and exportation of same goods as we do
- Economic uncertainty
- Liability problems
- The UK government could change its regulatory status and decide to regulate and enforce strict regulations that can strangulate new businesses like ours.
b. How Do Import and Export Businesses in the UK Make Money?
The import and export businesses in the UK make money by exporting goods or importing goods.
c. Payment Options
- Payment via bank transfer
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
- Payment via bank draft
d. Sales & Advertising Strategies
- Introduce your import and export business by sending introductory letters alongside your brochure to merchandise, production companies, wholesale companies, and other key stakeholders throughout the city where your import and export business is located.
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across
- Create a basic website for your business to give your business an online presence
- Directly market your products.
- Join local import and export business associations for industry trends and tips
- Provide discount days for your customers
- Advertise our business in community-based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories)
- Encourage the use of word-of-mouth marketing (referrals)
Financial Projection
a. How Much Should You Charge for your Product/Service?
It is important to state that there is no standard price when it comes to the amount charged for exporting goods from the UK or importing goods from other countries into the United Kingdom.
This is so because factors such as type of goods, your choice of shipping, the country (where the goods will be imported from or exported to), logistics, and of course, the clearing and forwarding fee attached to the goods are just some of the factors that can determine the cost you will charge for your import and export business.
b. How Much Profit Do Import and Export Businesses in the UK Make a Year?
The profit you stand to make as an import and export business owner is not fixed, but you can rest assured that if you are involved in the importation or exportation of goods that are fast selling and in high demand, you are sure going to make a fortune from the business.
c. What Factors Determine the Amount of Profit to Be Made?
- The capacity of the import and export business
- The types of goods you import or export
- The management style of the business
- The business approach of the business
- The advertising and marketing strategies adopted by the business
- The number of years the import and export business is in business
d. What is the Profit Margin of an Import and Export Business in the UK?
The profit margin of an import and export business in the UK. It will depend on some factors that are unique to the type of goods you are importing or exporting, the country involved, and your business location.
e. What is the Sales Forecast?
Below is the sales forecast of an import and export business in the UK. It is based on the location of the business and other factors as it relates to such startups in the United Kingdom;
- First Fiscal Year: £540,000
- Second Fiscal Year: £1.2 million
- Third Fiscal Year: £3.5 million
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Set Up your Office
a. How Do You Choose a Perfect Location for Import and Export Business in the UK?
- The commerce activities in the location
- The demand for products that are imported into the location
- The purchasing power of businesses and residents of the location
- Accessibility of the location
- The closeness of the location to a seaport
- The local laws and regulations in the community/state
- Traffic, parking and security et al
b. What City is Best to Open an Import and Export Business in the UK?
- Newcastle
- Middlesbrough
- Kingston Upon Hull
- London
- Plymouth
- Dorchester
- Norwich
- Ipswich
- Cardiff
- Portsmouth
c. What Equipment is Needed to Operate an Import and Export Business in the UK?
- Computers
- Logistics software.
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Hire Employees
When it comes to hiring employees for a standard import and export business in the UK, you should make plans to hire a competent chief executive officer (president), logistics and merchandize manager, clearing and forwarding liaison officer, and customer services, officer.
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Launch the Business Proper
In recent times, no import and export business in the UK opens its door for business without first organizing an opening party to officially launch the business. You can choose to do a soft opening if you are operating on a low budget or you can go for a grand opening party.
The bottom line is that with a proper launching of the import and export business in the UK, you will be able to inform people in your city that you are open for business.
a. What Makes an Import and Export Business in the UK Successful?
- Choose a good location to launch the business
- Engage in the importation and exportation of a variety of goods (give your customers options)
- Be deliberate with your marketing and sales approach
- Encourage the use of word of mouth to promote your import and export business
- Leverage all available online and offline platforms to promote your import and export business
b. What Happens During a Typical Day at an Import and Export Business?
- A typical day at an import and export business in the UK begins with sourcing for goods to export from the UK and also sourcing goods to import from other countries into the UK.
- Paperwork, financial transactions, and logistics are carried out throughout the day.
- The business is closed for the day.
c. What Skills and Experience Do You Need to Build an Import and Export Business?
- Logistics and merchandize handling skills (Understanding technology)
- Excellent customer services skills
- Interpersonal skills (Networking skills)
- Accounting and bookkeeping skills (Understanding finance and budgets)
- Business management skills
- Bargaining skill
- Understanding of international trade compliance requirements
- Analytical skills.
- Accountability and adaptability
- Ability to receive feedback
- Communication skills
- Work experience in an import and export business environment
- Experience in managing people
- Experience in business administration.