Agents and Transport Options
When to use a clearing agent
The first time that you import goods into the country, there is nothing stopping you from clearing the goods yourself. However, if you repeat the process and import on a regular basis, you will have to use a clearing agent,” explains Margie Pedder of the South African Association of Freight Forwarders.
“The reason for this is that the import process has become a fully automated process, which means that as a small importer you don’t have the infrastructure to use Electronic Data Interchange systems (EDI) which is why you need the services of a clearing agent, says Pedder”.
In July 2009 in terms of Government Notice R814 SARS enforced the use of EDI for the submission of certain cargo and goods declarations and reports.
What is EDI?
EDI organises the flow of information from one end of the supply chain to the other. The EDI revolution benefits customs and trading partners because it offers a number of advantages and in this way, South Africa can keep up-to-date with global import and export data requirements.
- EDI is a fully automated process that needs little or no intervention by either party
- Declarations that can be accepted round-the-clock
- The quicker retrieval of cargo through the reduction of clearance times
- A reduction in manual administrative processes resulting in fewer errors and no duplication
- Harmonised business relationships with other bodies such as Transnet Port Terminals, Transnet Rail Terminals, airlines and container depots.
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Drop shipping
Drop shipping’ is a technique used in supply chain management where the retailer transfers customer orders and shipment details directly to either the manufacturer or a wholesaler instead of physically keeping goods in stock. The manufacturer or wholesaler then ships the goods directly to the customer.
As in the case of all retail businesses, the retailers make their profit on the difference between the retail price and the wholesale price. The upside of using drop shipping is that you the retailer avert the risk of capital outlay in purchasing or importing products. You also remove the risk of sitting with unpopular products that you may battle to sell.
As in all business ventures, you will have to have a detailed contract with the partners with whom you drop ship. This contract will contain details including when and how you obtain your payments and details on fulfilment on orders, product guarantees, etc.
How would using a clearing agent affect import costs?
“It is vital that a small import company conducts proper research to determine the most economical and cost effective method of importing products.
Clearing agents have years of experience, keep up to date with legislation, exchange control and banking regulations. They want to save money for their clients,” says Pedder. “It’s wrong to think that using a clearing agent isn’t cost effective. They only make 2% on disbursement”, advises Pedder.
According to the South African Revenue Services, (SARS), if you are importing goods frequently into South Africa you must have an import licence and if the value of the goods exceeds R400 you have to pay full duty.
Regulatory bodies for different imported products
Statutory regulations state that to import any product to South African you must register as an importer with the Department of Trade and Industry (DTI).
If your shipment is customs-dutiable, it needs to be accompanied by an invoice especially if it is a commercial shipment with a commercial value. A commercial invoice must show the price you have been charged, the importers and exporters names and details.
Other documents you may need include:
- Bill of Lading
- Insurance documents
- Import permit number
- Packing list.