As a businessman, you face challenges everyday. From starting your business to promoting your products, from marketing your goods to exploring a new market- challenge is everywhere in the world of business. You cannot help but face them.

In import business, the problems are much more complex, and when things go wrong, solving them can be more difficult and expensive. Therefore, it is better to keep yourself equipped with different risk management skills before you start you import business.

How to manage country risks for import?

• Always do extensive market research and try to know about the politics, economy, culture and business environment of the country where your supplier is located. Besides language barriers and legal restrictions, your business may be get affected by suddenly introduced new regulations, political riots or natural disasters.  
• If you are dealing in a foreign language, taking assistance of a professional language support is a good idea.
• In import business, a clear agreement is very important to get rid of confusion and to reduce risk.
• If you find that doing business with a company in a foreign land is very risky, don't get involved in long term business deals.   
  

Is the supplier reliable?

• Is the supplier what it claims to be?
• Are the goods you are going to import meet your requirements? What is the quality standard the supplier maintains?  
• Is the supplier follow ethical business practices? Importing from a company which does not follow transparent business ethics may affect your reputation.
• Always choose the right supplier and the right payment method to reduce risks.
  

Ensure that the goods will satisfy your requirements

• Do your import activities comply with all relevant Indian regulations? Do you require any license for importing some of the goods?    
• Ask for product sample from the supplier. You can test their quality to ensure that the products meet the specific standard you wish for.  
  

Minimizing import delivery problems

• A clear contract with the supplier setting out who is responsible for transportation of goods is very important to reduce the risk of loss due to damage of products.
• Keep ready all the documents required for custom clearance. If necessary, you can take the assistance of a  import agent or a freight forwarder to handle this kind of formalities.  
• Returning incorrect shipments and waiting for new delivery is very time consuming. So, it is better to arrange deliveries a few weeks before you need them.  
  

Payment problems

• Never pay in advance. Getting compensation for faulty products can be very time-consuming and expensive.
• If the supplier want you to use a letter of credit, remember that this can be complex. Accept it only if you have proper knowledge of the payment method.
• Always try to know exactly what costs you and your supplier are each responsible for. Shipping or air freight, import duties, taxes, onward delivery to your premise- consider all these things before signing the contract.
• Import duties, foreign currency exchange rate could change, and therefore, it is important to keep yourself ready for some extra expenses.
  

Finding low cost products to reduce your cost is the best way to make your business competitive in the local market. But import business always carries risks. These risks vary, and we cannot get rid of them completely. But the risks can be reduced taking precautions. In the above discussion, we have attempted to offer some useful tips to reduce different kinds of risks which are part and parcel of import business.