As a Latino, you may not know exactly how to import products from Latin America, but you certainly know how valuable those products are. Latin American countries have many important products that are valued around the world, and that can be seen in what it exports.
According to the World Integrated Trade Solution or World Bank, exports from Latin America and the Caribbean to the United States was worth an astonishing $408 million in 2017 alone! In fact, the United States is the top country that imports Latin American products.
While some of the top products that the U.S. imports from Latin America are petroleum oils and copper ores, there are plenty of other products from the region that could be your focus as a small business owner: think of textiles, clothing, beauty products, arts and crafts, jewelry and specialty foods. Being a Latino presents a terrific opportunity for you to start an import business since you are likely very familiar with the abundant products that come from Latin America, and the potential market here in the U.S. for those products.
Starting an import business can be a little trickier than starting a business in another field. In a way, it can be like navigating a complicated maze. Knowing how to import, with all the rules and regulations, is extremely important before starting to get to work.
Comply With the Law and Regulations on Imports in 3 Steps
If navigating through complicated laws, rules, and regulations with multiple government agencies is something you enjoy doing, then importing goods from Latin America to the United States is the field for you! All joking aside, importing goods from any country to the U.S. can be a nightmare dealing with all the bureaucracy that’s involved.
While you may not enjoy going through the hoops and following all the rules and regulations to a T, it’s necessary if you want to learn how to import goods from Latin America.
The first step in the process is to make sure that the product you want to import is allowed to be imported to the U.S. in the first place. The good news is that you won’t need a license to import most goods to the U.S., although you will need one if you intend to import any animals, dairy products, medications, plants and any material that is copyrighted or trademarked.
You can find a full list of restricted products on the U.S. Customs and Border Protection website. One thing you will need if you want to start an import business, or any other type of business, is a business tax number, which can be obtained through the IRS — if you don’t already have one.
The second step in the import process is to file documents that will allow for your product to be released from the country it came from, as well as be assessed for duty. This can be done online at the Customs website as well. You’ll need an account through the Automated Commercial Systems to do so.
At this stage, Customs will decide as to whether they think they need to examine what it is you are importing. If they do, they’ll be checking to make sure you aren’t violating regulations or laws before the goods are released to you.
If this isn’t complicated enough for you, the third step will certainly turn your heads. Once your product has been approved, you may be subject to a duty fee. You may be charged three types of duties:
- Ad valorem: a percentage of the value of the good
- Specific: an amount per unit of either weight or other quantity
- Compound: a combination of Ad valorem and Specific
The rates of these duties are determined by whether the nation you are importing from has a trade agreement with the U.S. or not. The General column duties are charged at a lower rate, while the Statutory column charges higher duties for products imported from countries that don’t have a trade agreement with the U.S.
While it may seem quite complicated to figure out the cost of your import, you can conduct a free search on your product at Dataweb.
Five Tips to Import Products from Latin America
While learning how to import products from Latin America to the U.S. may seem like a daunting process, it is something that many business owners do every day. For them is well worth it: they are very familiar with the products offered from Latin America and the huge opportunity they represent to make a profit as a business owner in the United States.
If, like many other savvy entrepreneurs, you are also considering starting an import business, here are five key tips to keep in mind.
1. Do your research
This is an important step in starting a business in any field, but it’s especially important if you’re going to be importing products. In addition to needing licenses and permits to operate your business in the U.S., you’ll need to get your ducks in a row, so to speak, with what other agencies you’ll be dealing with.
2. Import a product you know well
As a Latino, you have the unique opportunity to share the products you love with all of the United States. That’s why we advise you to choose a product to import that you know well and that you are passionate about. This passion will translate to the people who are buying your product here in the U.S.
3. Make sure that product can be imported
Before getting too excited about your new import business, you’ll want to make sure that it can be imported to the U.S. As we mentioned above, some products are restricted from being imported at all. Do your research and find out what the law states.
4. Plan for the costs
Importing products from Latin America adds an extra cost for business owners. Not only will you be straddled with costs related to running the business locally, but your product cost may be higher than in other industries because your product will be imported and not produced locally. Make sure the actual cost — with the real tariff/duty prices — is factored into your business plan.
5. Seek out help if you need it
Consult with other Latino business owners in your area who import products. This will be a wonderful resource for you as you look to figure out how to import products from Latin America to the U.S. There are also a lot of other resources online and through local networking organizations or business organizations.
Bring Your Culture to the World!
Latino culture is one of the most vibrant, exciting and fulfilling cultures in the entire world. And more people than just those living in Latin American countries deserve to share in all the experiences and products that you know and love. This is one reason why starting an import business can be a great way for you to share this culture while allowing yourself to make it as a Latino business owner.
As a Latino, you likely already have great local support and networking group of people just like you who share in your love and passion for products from Latin America. Now, it’s just time for you to take that next step and share that passion with others.
If you are looking to start an import business from Latin America to the U.S., there are a wide variety of resources that can help you along the way. While importing products can seem like a daunting task, there are several free resources available to you from both independent organizations and the U.S. government as well.
Keep reading How to Start a Business as an Immigrant in the U.S.