I am acting as an export-agent. Basically I have an overseas buyer who is looking for TMT Rebar, and have hunted, searched, corresponded and verified / identified a legitimate supplier.  I have bought some books, done much research online and would like to elicit the help of someone who has done this before. 


I've corresponded with my supplier, gone through a business verification process with them which has checked out.  Right now everything has been done via emails, as I am trying to find out how much product they can provide on the first shipment etc.  Basically all the information which I will then put together in a ICPO (purchase order) based off of the letter of intent received from my buyer.


Once I submit the ICPO to my supplier, what should I get in return?  A pro-forma invoice to then open the L/C? 


My supplier has only quoted me EX-Works thus far and I am trying to get him to quote me FOB, however he is saying he cannot.  He is working to get me some contact information for a Freight Forwarder who will be able to assist me in picking the product up from his mill and transporting it to the shipping point. 


I was thinking that I would only quote my buyer the FOB price, therefor having the buyer nominate a vessel and handle all shipping etc. 


I would need some type of inspection from SGS Group?  How does that work and how is that incorporated into this deal?  From what I understand the product needs to be inspected to be verified before any funds are released through the L/C?  Is this something that I will need to coordinate myself through SGS or does the bank handle the inspection process (as part of their fees)?


Also with LC's, Since I am acting as the third party, what is the best way to handle the LC?  Right now I am thinking to have the buyer open an LC in my favor, then I would open an LC in the sellers favor.  Essentially shaving off my 1 or 2 % commission between transfers. 


Aside from the above issues, I want to clean this deal up and make it as easy as possible.  After the first transaction is complete I am sure this will be alot easier. 


Export Country is India.  Importing to Dubai and Turkey.  My company is US based...2 man operation. 


Thanks in advance!!

syndicatepi: Because you are so close to cutting a deal, you must get professional help or risk ballsing it up. 

Much hands-on experience is needed to properly do what you are attempting. More can go wrong in that complex deal than you can ever glean from poking around the internet. I recommend that you contact your own countryman, Ranger, who you see around these forums. Given a proper confidential brief, I'm sure Ranger will safely guide you through the intricate steps and watch over your day-to-day dealings in that transaction for a modest fee.

 Your second paragraph puts me at odds to what your trying to do.  Your getting way ahead of any ICPO, Pro Forma, or L/C

Supplier: 

1. Wholesaler, agent, or manufacturer?
2. What process of business verification?
3. Where is verification of manufacturing capability?
4. Does the supplier have the necessary funds to secure raw materials for the production?
5. Why quote of ExWorks only?  (Actual Rebar manufacturer would have knowledge of freight forwarding) Rail, truck, or otherwise.  Never dealt with India's Customs or process to undertake an export.
6. SGS verified lab testing of the product from a previous production run as or a capability study to produce the required product  or both (paid for by the supplier)
7. Loading inspections

Buyer: 

1. How have you verified the buyer?
2. Credit verification of business to pay for requested supply and shipments?
3. ICPO signed by who and authorized by who?

As Agent (yourself):

1. Fee protection  (who is paying you and how)
2. Formal Contracts
3. Understanding of India Customs exports procedure
4. Understanding of AE Customs imports procedure
5. Do you have access to agents of carriers and freight forwarders In India and their shipping schedules?
6. Access to Vessel arrival ports and departure times around the world?
7. What is your personal knowledge of TMT rebar how its produced, from what alloys, allowable tensil specifications, ect....
8. The biggest thing of all.  You and your partner need passports/travel visa's and a budget to fly and verify yourself.  You need to establish partnerships and network with companies and individuals that can provide you with real information. 

The thing is you can't guide a deal unless you know these simple things and more.  You need the ability to forsee problems an act, not re-act.  As an agent you should have a grasp on who the carriers are from each port. legitimate forwarders, customs brokers ect.

Can you pick up the phone and have a direct conversation with anyone or a representative of SGS or any other Certiying body? 

 

If your doing simple introductions your interest in a deal is negligible at best.  A full service agent carries service liability insurance that secures the costs related to any deal.  Afterall, your the one who has verified the supplier and their ability to supply so why would a buyer want to chance the costs of legal contracts and opening up a non useable L/C or in some instances be required to fully fund an L/C to the expiry date.

Nope your a long way from doing any real kind of deal.  Books give you theory only and do not apply to all given situations.  Experience, is the only real teacher.  Something you cant get without taking the financial risk of your actions or being employed by an agency that can to show you the way.

You can contact me thru my signature line to mentor your deal for free.  But fee's are based on what need's you have.

To other readers of this post:

This does not mean I will mentor anyone for free, but on average I do freely give my help to one individual per month in a teaching capacity only.  Afterall, I have my own business to run as well.   Services and contacts are fee based.   My belief is if you make your living from a business you should attempt to give something back to those individuals trying to take the same road you have taken yourself.

Ranger

Ranger, You've given me some things to think about, and I have been. I have some additional information that I will put together in an email shortly. I'm in the process of moving.


Background on all of this. I have a full time job, I travel alot, i'm an honest person with a healthy entrepenural (sp) sprirt. A Saudi Arabian contact of mine, living in the states has told me that he knows some folks who work for a construction company in Dubai who are looking for a certain steel product. I told him I would do some research, so literally over the course of the past 2 months I have researched and researched this product as to where I have a decent understanding of it and can probably act as a salesman for it. I learned about tradekey which is where I began, I called alleged suppliers in India and China (lots of late nights) and eliminated those which I felt were scams. I narrowed it down to a few and chose one to focus on. <----Seller.


I bought the Import/Export for dummies and have read it cover to cover. We recieved a Letter of Intent from the Buyer which was signed and stamped on the bottom. For verification of the seller, I requested their CIN (business registration number) which was provided. I took that number and contacted the Ministry of Corporate Affairs in India. The CIN provided was registered to the company name provided. The website has been registered for quite a few years. All of the names, phone numbers, addresses have been compared between multiple sources for the seller, all are matching with the exception of one name. I asked the seller a few questions, evidentially its a father / son owned company. I have searched Alibaba, Tradekey, google for the company name, names, phone numbers, fax numbers, email addresses with the word "scam" and nothing has come up. Additionally I have recieved scanned SGS documents from a job that the seller supplied materiel for earlier this year. I have been emailing back and forth with the seller for over a month.


The Buyer, I have not verified the buyer at all. I have done a search for the company name with no success. After reading your response to my first question, I have thought to put together some type of informal business verification form which I will then forward to the buyer. I have not done that yet, but plan too.


The situation I am in, I have literally no risk - personally. All transactions are being done through my Saudi Contact / Friend here in the states. If anyone takes a loss it will be him. While we've been friends for years, I don't want that, so I am doing everything that I know how to do, to ensure a legitimate deal occurrs. I am patient, not looking to rush in and make an ameature mistake but the more I have researched this, the more there is to do. Frankly I feel slightly overwhelmed. I know I have the smarts to figure it out with a little help.


My gut feeling tells me I have a legitimate seller. We are prepared to visit India, once the deal is at the brink of closing / point of no return. Meet with the supplier, get some face time and show them that we are serious and would like to keep a long term relationship.


I know I said I would write later but I ended up doing it now. lol

Thanks alot for your words, I'm a hard worker and love learning about new "things" and seeing them from start to finish.


I tried to add you as a contact but for some reason I couldn't figure it out.


I'm not sure where you are located Ranger, but I travel alot and would be interested in meeting with you in person if you happen to be in an area I frequent. Los Angeles, Kansas City, Houston, San Diego, San Jose, Seattle, Maryland. Thanks again.