By Angela Baker
International trading is a highly demanding area of business. Numerous elements need to come together in order for it to be a successful operation. This game of import and export is far more complex that what you may expect. This is why you must learn about it and keep building your knowledge.
To be able to succeed in international trading, you have to know what are the most common mistakes people in this industry do. If you’re not sure what to look for and how to stay safe, just keep reading. We’ll break down the most common mistakes in international trading that you have to avoid.
Let’s dig in.
Overlooking Exchange Rates
The number one thing all international traders have to focus on is the money. When you’re handling trade in different countries or even on different continents, you need to make sure you have everything figured out.
That includes the foreign exchange rate.
The foreign exchange rates fluctuate and change rapidly. It can easily happen that you ship the order and during the 30-day period it takes to arrive, the exchange rates change. You can suffer some serious losses.
This means that you have to pay attention to the exchange rates and do something to prevent making a mistake of overlooking it:
- create a foreign exchange policy or strategy
Gather a team of experts and work on creating a strategy that would help you deal with this potential problem. Make sure you’ve got yourself covered before you ship your next order.
- test your policy
Give your new policy a try and see if it’s giving you the desired results. If it is, adopt it for the long-run.
- find a consultant on the target market
Hire a salesperson or a consultant overseas to help you follow these changes and get to the bottom of the problem.
Focus on potential risks and learn from your previous experiences. Once you gather all that information, you’ll be able to understand where you’re losing your money and how to stop it.
Don’t overlook this potential risk, even if you still haven’t faced the problem of losing money because of the exchange rate fluctuation. it could happen at any moment.
2. Ignoring Country Regulations
Each country has its own international trade regulations. Also, there are differences in the international trade law of each country.
When you’re in international trade business for a long time, you might start feeling safe and like you already know everything there is to know. This can lead you to bring your guard down and overlook the things you shouldn’t.
Here’s what it all comes down to:
- laws and regulations change
- there are some countries which share the same rules while others differ completely
- you need to stay updated and check country regulations regularly
It’s not good enough that you’ve been to a country several times ad you feel like you know the drill there. You have to walk the extra mile and ensure you’re staying on the safe side.
You can do this by:
- signing up for regulation changes updates
- hiring someone to keep track of this for you
- reading thoroughly to get accurate information on what you can or cannot do on the territory of a country
“It’s highly important that you follow the changes in international law. One day you could be allowed to do something and the next day it’ll be illegal. Stay updated and you won’t have to go through any trouble” says Helen Pearson, a lawyer and the head editor at Supreme Dissertations.
Not following these regulations would mean breaking the law. That could leave to more or less severe consequences such as:
- paying a fine
- being banned from doing trade in that region
- losing your license
You could organize corporate events such as trainings or workshops to connect with experts and learn form them.
Don’t ignore the regulations and make sure you have all the information you need for regular, legal international trading.
3. Overlooking Packaging and Marking Regulations
Another majorly important aspect of international trade that you have to pay special attention to is the packaging and marking regulations.
Each product that is entering a new country needs to follow very specific regulations in terms of how it’s packed and labeled. Again, certain countries may share the same regulations. But, let’s not forget those that differ.
For example, there are mandatory regulations that require specific labeling of:
- electronic equipment
- dangerous substances
- household appliances
There are dozens of product or package categories that you need to learn about and ensure you know enough about to handle.
You need to write the declaration and the label properly, as well as use internationally recognized symbols such as the symbol for recycling, inflammatory substances, the period after opening during which the product can be used without harm, etc.
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Play on the safe side and respect the packaging and labeling regulations. If you fail to do so, the fines you’ll have to pay might shut you down for good.
International trade is a serious matter and each step of the way you have to be certain you’re doing things the right way. There are potential mistakes you could make that you cost you a fortune or break you completely.
The advice above will help you understand which mistakes you could be making. Hopefully, it will prevent you from making those mistakes. Stay informed, update your information regularly, and you’ll have nothing to worry about.
About Angela Baker
Angela is a self-driven specialist who is currently working as a freelance writer at TrustMyPaper writing services and is trying to improve herself and her blogging career. She is always seeking to discover new ways for personal and professional growth and is convinced that it’s always important to broaden horizons. That’s why Angela develops and improves her skills throughout the writing process to help to inspire people. Also, she writes for LiveInspiredMagazine, rounding out her professional writing career.