How to start a profitable export brokerage in simple steps
How to start a profitable export brokerage in simple steps
Export brokerage – So he knows what the buyer/importer wants, source it from a local producer/exporter or seller, then gets the buyer to know about it, the buyer made the purchases at agreed price, he then takes his commission.
It’s as simple as that.
An export broker is an intermediary/link person between the importer and the exporter, he source goods the importer wants by getting him connected with a local seller, a price is agreed, he gets the buyer to make the payment while he gets his own share as a commission from the trade.
The broker in question does not need to make purchases with his money, you don’t need capital as a broker, just refer and make your money.
The is the easiest way to make money selling agro products without investing a dime into it, you make money instead with relative ease.
Export brokerage business viability
If only you know that Lebanese and Indians troop into Nigeria to do this business, they make a whole lot of money while our youths are busy chasing naira and kobo in places they do not exist.
Typically, export brokerage will make you a millionaire within a shortest frame
Assuming you connect an exporter and an importer for a goods with say “50 metric tons,” on a $200 commission per metric ton.
If the deal pulls through, you’d sure make $200 X 50 = $10,000.
Unbelievable right? But that’s absolutely honestly correct.
There’s no limit to how much you can make so long you’re willing to do the mental and persuasive work that’s involved.
This business is very lucrative, bringing a foreign importer and a local exporter is even easier these days with the availability of phones, email, the internet has created a thriving ground for this business.
So how do I get started, it’s no rocket science whatsoever, so long you read this guide to the last paragraph.
In this business, you need the following information to navigate a success to the pinnacle
- What are the hot in demand products by the importer?
- Are those products exportable from Nigeria
- Find out how much such product is sold at the international market.
The above are your basic steps to a winning strategy in this business.
Steps in becoming an export broker
#1. Identify the products on importers demand list
By this, you should be able to find out the products your would be foreign buyers are looking for, a very hot one at that.
How then will you find out such products?
Like you already know, agricultural products are on the front list, this a lone can bring in the riches you yearn for.
Identify these buyers/ companies and match their need with a supply of the products they need, simple, this is how to close a deal faster than trying to make a blanket enquiry.
The next step you will like to take is;
#2. Find out if such products are exportable from your country
There’s a list of exportable products in Nigeria, working closely with the Nigeria Export Promotion Council will avail you this list.
Just like we have list of import products, viz versa.
Alternatively you can lay a grip on them here
Ensure there aren’t restrictions for such products from the country in which you intend getting them export from.
#3. Find out the product price in the international market
Having identified the agro product you’d like to source and connect importers with abroad, a first-hand knowledge of the market price internationally is ideal.
This will help you to bid and tag commission alike.
As an export agent, it does not go without saying that your success lies around the pricing of the agro product.
The importer/buyer will only consider your link if your price averages that obtainable at the international market.
You must be very cautious to avoid over pricing or under pricing either, just be moderate and make your money.
The importer should be willing to tell you the price in the international market, likewise the exporter should state how much he’s willing to let go of his products.
In any case, international market prices can be found on www.importexportplatform.com
#4. Commence your search for both the importers/buyers & exporters
In export brokerage, with the help of the Nigeria Export Promotion Council, your tax to sourcing exporters/seller is easier.
NEPC has a list of registered exporters you can rely on their supply.
Having put this under control, now move on to getting your importers or international buyers as well.
There are a handful of directories you can turn to your favor e.g www.alibaba.com
However, you may adopt the below strategy to find buyers on Alibaba
- Importer + kola nuts + Portugal
Assuming you want to search for importers of kola nut in Portugal, the above keyword variation will reveal companies in Portugal who are into buying and importing of Kola nuts.
Use, rinse and reuse this process for all concerned countries and products.
Having identify them, make a routine outreach to contact and inform them of your service, once you get a positive response, the business commences in earnest.
Read also: How to start profitable cashew nut export business in Nigeria
Assuming you are on a lookout for exporters of cashew nuts in Nigeria, then use the below keyword variation.
- Exporters + Cashew nuts + Nigeria
You should be able to get a list of companies that export and supply cashew nuts to other parts of the world from Nigeria. It’s that easy to automate.
#5. Outreach Proper
As an export broker, having put the above information to your advantage, it’s time to talk to your suppliers and the buyers, you’re expected to conduct yourself properly and accordingly.
You need to contact the importer as an independent agent/export broker as the case may be, you should state it clearly that you’d like to be their agent to help source the required products in Nigeria, or your own country as the case may be.
As a matter of necessity, before you start sourcing products for the company and representing them, kindly request from the exporter, a written letter printed on their own Letterhead, signed and stamped.
This letter should authorize you to represent them in the deal at hand.
It helps forestall any foul move by them as the deal gets juicy.
#6. Negotiate the business
This is the most sensitive part of the deal, you will have to negotiate with both the importer you are representing and the exporter as well.
Here’s the buzz, the importer will have their own price, never tell them the exact price negotiated with the exporter, you will have to include your commission to arrive at the total price.
While doing this, be mindful of the product price at the international market.
Again, you are not getting anything from the exporter, so do your homework well. Your loyalty lies with the importer.
#7. Product inspection proper
Having concluded on the price, it’s time to get a product inspection company to inspect the agro product.
Do however convince the exporter to use the importer’s inspection company, this is where your loyalty lies.
Having inspected the product and certified Ok, you’re almost game.
#8. The next is about the payment plan to be agreed on
The importer and the exporter should agree on a payment plan, which could be FOB i.e Freight on Board.
This means delivery will be made on board by the shipper without charge, some payment committed by the importer, while being completed as the goods arrive the importers port.
#9. It’s time to link up the importer and the exporter.
The deal is finally coming to a completion, it’s time to tell the exporter that your importer is ready and willing to consummate the transaction.
Here, you will need to initiate an agreement with the exporter, detailing him how much commission is yours from the settlement he’s getting from the bank after your importer might have completed the payment.
The both of you should reach a consensus, duly signed and exchanged.
You must understand that the bank will pay the exporter according terms of agreement, all the money your commission inclusive will be sent alongside to the exporter at the completion of the process.
It then stand to say that you’ll receive your commission, when the exporter has received full settlement, your agreement should state that you ought to be on the know, otherwise some exporters will refuse to pay your commission.
Conclusion
As you can see, export brokerage is a bit easier and comes with a whole lot of cash benefit.
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